Powder River Basin Res. Council v. Jewell

Decision Date06 December 2018
Docket NumberCase No. 14-CV-97-ABJ
Citation358 F.Supp.3d 1238
Parties POWDER RIVER BASIN RESOURCE COUNCIL, Western Organization of Resource Councils, Petitioners, v. Sally JEWELL, in Her Official Capacity as United States Secretary of the Interior, Ned Farquhar, in His Official Capacity as Deputy Assistant Secretary for Land and Minerals Management, United States Office of Surface Mining Reclamation and Enforcement, a Federal Agency Within the United States Department of Interior, Federal Respondents. and State of Wyoming, Peabody Powder River Mining, LLC, Intervenor Respondents.
CourtU.S. District Court — District of Wyoming

Brad Arthur Bartlett, University of Denver Environmental Law Clinic, Denver, CO, Shannon Anderson, Powder River Basin Resource Council, Sheridan, WY, for Petitioners.

John S. Most, Department of Justice, Washington, DC, Nicholas Vassallo, US Attorney's Office, Cheyenne, WY, for Federal Respondents.

James C. Kaste, Wyoming Attorney General's Office, Bruce A. Salzburg, Hirst Applegate LLP, Cheyenne, WY, Kirsten L. Nathanson, Sherrie A. Armstrong, Pro Hac Vice, Crowell & Moring LLP, Washington, DC, for Intervenor Respondents.

OPINION AND ORDER AFFIRMING AGENCY ACTION AND DISMISSING PETITION FOR REVIEW

ALAN B. JOHNSON, UNITED STATES DISTRICT JUDGE

Petitioners Powder River Basin Resource Council ("PRBRC") and Western Organization of Resource Councils ("WORC") (collectively "Petitioners") challenge the decision of the United States Secretary of Interior ("Secretary"), the Deputy Assistant Secretary for Lands and Minerals Management ("Deputy Secretary"), the United States Office of Surface Mining Reclamation and Enforcement ("OSMRE") (sometimes collectively "respondents" or "federal respondents") approving a mining plan modification on March 14, 2014 for Peabody Powder River Mining, LLC's ("Peabody") North Antelope Rochelle Mine ("NARM") in the Powder River Basin ("PRB") in Wyoming. The State of Wyoming and Peabody were permitted to intervene in the administrative action (collectively referred to as "intervenor-respondents"), also opposing the relief requested by Petitioners.

Petitioners seek judicial review of the decision approving a mining plan modification under the Administrative Procedure Act ("APA"), 5 U.S.C. § 706(2)(A). Petitioners contend the agency's decision approving the NARM mining plan modification violates the Surface Mining Control and Reclamation Act ("SMCRA"), 30 U.S.C. §§ 1202 et seq. and does not satisfy the requirements for reclamation set forth in Title 30 of the Code of Federal Regulations. Petitioners contend the agency decision was arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law, in violation of the APA. The respondents and intervenor-respondents assert Petitioners' allegations are overstated and improperly apprehend both SMCRA and the Administrative Record ("AR") in this case.

Having reviewed the parties' submissions, all materials in the record, and being fully advised, the Court finds and concludes that the decision recommending approval of the mining plan modification by the Secretary is consistent with and in accordance with applicable law, is supported by substantial evidence in the administrative record, and there is no clear error warranting reversal of the Secretary's decision. For the reasons stated more fully below, the Secretary's approval of the mine modification plan is affirmed and the Petition for Review will be dismissed.

Background and Contentions

The Secretary approved a mining plan modification authorizing a coal mine expansion for Peabody's NARM, one of the largest strip mine operations in the world. The mining plan modification that was approved would expand the size of NARM to approximately 60,000 acres, with over 53,000 surface acres disturbed by mining; approximately half of the disturbed lands are federal public lands. The mining plan increases the public lands available for mining an additional 6,717 acres within NARM, for a total of nearly 30,000 acres of affected federal public land ownership. Petitioners assert that during the 30 years of operation of NARM, no lands or waters of the mine have been permanently reclaimed. None of the federal public lands impacted by NARM operations have been permanently reclaimed, which has resulted in a single use of those federal lands by Peabody.

In their petition for review, Petitioners assert that the mining plan modification was authorized "behind closed doors and without the benefit of public input and participation." They further assert that the mining plan modification fails to ensure contemporaneous and timely reclamation of federal public lands and restoration of associated waters by establishing a timetable, measured by bond release, for accomplishment of every major reclamation step and minimizing disturbance to the hydrologic balance. The mining plan amendment exacerbates Peabody's reclamation failures by allowing Peabody to self-bond or provide a "corporate guarantee." Petitioners explain this to mean that Peabody never puts up real money intended to protect the federal resources that are damaged through operations pursuant to the mining plan modification. Thus, there is no real economic incentive for Peabody or the operator to timely or contemporaneously reclaim these public resources. Petitioners also argue that Peabody's ability to self-bond and guarantee successful reclamation is questionable. This is because Peabody has suffered significant losses over a long period of time and its credit rating was downgraded to non-investment grade or junk bond status. Petitioners assert there was a complete failure to consider Peabody's bond status and its ability to self-bond and cover its financial obligations to complete reclamation, while still allowing Peabody to cause additional disturbance of public lands within the mining plan modification.

The federal respondents have opposed Petitioners' contentions. The process for approving applications for coal leases first comes to the federal agency under the authority of the Mineral Leasing Act of 1920 ("MLA"). The first stage in that process requires the Secretary to consider various economic and environmental factors in making decisions regarding applications for federal coal leases. Frequently, this is referred to as the NEPA process. The next step in that process requires the Wyoming Department of Environmental Quality ("WDEQ"), which is the federally approved SMCRA permitting authority, 30 C.F.R. § 950.20, to consider applications for surface mining permits, provide opportunities for public comment, and issue permits and approve proposed mining plans, which includes the requirement to address mining and reclamation requirements of the SMCRA program. WDEQ then forwards to OSMRE for mining plan approval. The third stage of the process requires OSMRE to conduct its own review and make recommendations to the Secretary that the proposed plans for mining federal coal be approved, disapproved, or approved with conditions. 30 U.S.C. § 207(c) ; 30 C.F.R. Part 746. It is the Secretary who makes the final decision on proposed mining plans.

The first and second stages require public participation; the third stage does not. Petitioner PRBRC participated in the first stage involving the decision to lease the two Wright Area coal lease tracts at issue here, the review process under the National Environmental Policy Act ("NEPA"), 42 U.S.C. §§ 4321 -4307h. Petitioner WORC did not participate in the first stage where the decision approving leasing of federal coal lands was made. At the second stage, there were four publications in the local press in October 2013 giving notice of the mining permit approval proceedings. Notwithstanding their knowledge of agency procedures providing notice to the public and opportunities to participate and comment, neither of the petitioners in this case did so in that second stage. During the permit approval stage, detailed plans for mining operations and reclamation required by SMCRA are reviewed and assessed. Petitioners offered no comment or input when WDEQ was assessing the permit application and mining plan modification, yet they contend here that the decisions were made behind closed doors and without the opportunity for Petitioners and others to participate and offer input.

As to the third stage of the case, responding to Petitioners' claim that the OSMRE did not provide opportunities for public participation, respondents argue Petitioners have misread the pertinent regulations and applicable law. OSMRE is required to consider comments received during the NEPA and SMCRA permitting processes, but additional formal public comment is not mandated in the third stage. Consequently, the respondents urge that Petitioners do not state a cognizable claim. Respondents also assert that, even if the regulations required public participation, no prejudice was suffered by Petitioners because they were fully aware of the process and the WDEQ/OSMRE proceedings. The remaining claims lack merit because Petitioners have not identified any violation of the SMCRA performance standards.

The State of Wyoming and Peabody were permitted to intervene as respondents in this action and submitted a joint response brief in opposition to Petitioners' opening brief. Many of the issues raised in the intervenor-respondents' opposition are substantially similar to those advanced by the federal respondents. During the permit approval phase, Petitioners never objected or offered comment that WDEQ, OSMRE or the Secretary violated SMCRA by failing to ensure the mining plan modification meets performance standards for reclaiming federal lands and water resources. Because these comments and arguments were never raised during the pertinent administrative processes, the Intervenor-respondents contend they have been waived and that Petitioners cannot complain about these matters now. Even if Petitioners can raise these arguments now, the record demonstrates...

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