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Signed, Sealed, Delivered: Montana owns Otter Creek Coal

A joyful Gov. Judy Martz accepted the deed from the federal government Wednesday
for 533 million tons of high-quality coal in southeastern Montana.

By JIM GRANSBERY
Of The Gazette Staff

The Otter Creek Tracts – 11 sections in three blocks – southeast of Ashland, became state property as Matt
Millenbach, state director of the U.S. Bureau Of Land Management, signed the federal patent, had it sealed by
Debbie Sorg, land law examiner for the office, and handed it to the governor.
Martz said the state was receiving "the most significant asset since statehood.
"The development of two of the three tracts could result in half a billion dollars in taxes and royalties over
the next 10-15 year period," she said.

Martz said she wanted movement on developing
the coal tracts "within the next year."
The newly acquired assets come under the
purview of the State Land Board, which must prepare
a request for bids on a lease.
Martz said at least three parties have expressed
interest in developing the coal. One of the interested
parties is a budding consortium that includes the
construction giant Bechtel Enterprises and the
Burlington Northern Santa Fe Railway.
About 50 people attended the signing and transfer
at the State BLM Office in Billings, including
representatives of the Northern Cheyenne tribe.
Earlier this year, the tribe filed a lawsuit against
the Interior Department to delay transfer of the federal
coal. The tribe said it wanted employment
opportunities and other protections written into the
deal.
On Feb. 19, the land board’s three Democrats
voted to impose some conditions on development of
the tracts. In exchange, the tribe withdrew its suit.
Martz opposed the conditions, calling for more
study of the issues and their effects on leasing the coal.
Regardless, the governor Wednesday said she wanted "to move forward."
"I will work with industry, local governments and the Northern Cheyenne Tribe," she said.
Hilda Moss, a Cheyenne and a member of the tribal council, told the governor her tribe is "part of Montana,
too," and the day represents accomplishments on behalf of the Cheyenne.
"We will be greatly impacted by this honorable day," she said.
Joe Walks Along Sr., a tribal elder representing President Geri Small, who was unable to attend, said the
tribe has the highest number of unemployed in the state. He spoke of the Otter Creek area as being a
traditional hunting ground.
Referring to dialogue between Native Americans and the non-Indian population of the state, he said there
was a lack of communication and "I wish we could talk better."
As a pastor for the past 40 years, he called for "peace with all the people of the world."
Martz said after the official presentation she would continue to press for continuing action on the
development of the sites.
"To wait has no ramifications for the people," she said. "This is also a signal to developers to move
forward."
Opening a mine and building a railroad to haul coal to Miles City for use in coal-fired generating plants may
cost up to $4 billion over the next decade, according to some estimates.
The coal in the Otter Creek tracts is considered high-quality and exceeds the standards set by the Clean Air
Act. The transfer creates contiguous holding of private/state coal, offering the possibility of large-scale
development of the resource.
The coal is Montana’s payment in the 1996 deal that pre-empted the construction of the New World/Crown
Butte gold mine outside Yellowstone Park. Although the 1998 Interior Appropriations Act outlined the transfer of
the coal tracts, Secretary of the Interior Bruce Babbitt refused repeated requests by Gov. Marc Racicot that the
Otter Creek tracts be turned over.
Early in 2001, Martz asked the new Secretary of the Interior Gale Norton to transfer the tracts.
Former U.S. Rep. Rick Hill, R-Mont., who was instrumental in getting the Otter Creek tracts into the 1998
Interior appropriations bill, estimated the Otter Creek coal had a potential value to Montana of $600 million in
taxes and royalties.
Martz thanked Hill for his efforts and also acknowledged the efforts by the current congressional delegation
of Sens. Max Baucus and Conrad Burns and Rep. Dennis Rehberg.
Jim Gransbery can be reached at 657-1288 or at [email protected]

Copyright © The Billings Gazette, a division of Lee Enterprises

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