Big coal lease, small price tag? Wyoming’s 440-million-ton tract may not spark a bidding war

Wyoming wants to put a monster federal coal tract back on the auction block. The problem: in today’s market, it might not fetch anything close to the blockbuster bids of years past.

We’re talking about West Antelope III—roughly 440 million tons of federally owned coal under 3,500 acres in Campbell and Converse counties. The Bureau of Land Management (BLM) has revived the decade-old lease-by-application and is fast-tracking it toward a sale. State officials and coal advocates are cheering. Potential bidders? Considerably more muted.

Navajo Transitional Energy Company (NTEC), which runs the nearby Antelope mine, says it would love to top up its mineable reserves—if the valuation pencils out. Another Powder River Basin producer, CORE Natural Resources, told BLM the fair-market value today is well below the region’s past benchmarks.

“Even though the administration is working hard to improve the market, it will take some time to dig out of the current hole,” said Jamie Olson, environmental affairs manager for CORE’s Thunder Basin Coal Co.

Translation: expect soft pricing “for the next number of years,” and don’t lean on historical valuations.

That was the tenor of a small BLM meeting this week in Gillette—part of the agency’s expedited push to set fair-market value and maximum economic recovery for West Antelope III.

Industry backers argue the real value isn’t just what a company pays up front, but what happens after a lease: production taxes, royalty flows, contracts for local suppliers—and steady paychecks.

“You’re keeping companies operating … and you keep people employed, and that’s part of the fair return,” said Travis Deti of the Wyoming Mining Association.

Conservation groups aren’t buying it. They worry the BLM—under pressure from Trump-era executive orders to “unleash” domestic energy and “reinvigorate” coal—will undervalue the tract, only to see companies struggle to find buyers over the 20–25 years it would take to mine the coal.

“The federal government is going out of its way to throw lifelines to the private coal industry,” said Emma Jones of the Sierra Club’s Wyoming chapter.

And even if it sells, she added, new tax breaks mean less money back to Wyoming.

Even a “successful” sale won’t deliver the windfall it once did:

• Federal royalty rate cut: The One Big Beautiful Bill dropped the federal royalty on surface coal from 12.5% to 7%—an estimated $50 million a year hit to Wyoming’s share.
• State severance tax trimmed: Lawmakers shaved the severance tax from 6.5% to 6%, an estimated $10 million loss in 2026, with more decline possible if production keeps sliding.

Compare that to the boom years: From 1992–2012, federal “bonus bids” on PRB tracts generated about $5.4 billion (roughly half to Wyoming). Winning bids that used to be 11–38 cents/ton in the 1990s blew past $1/ton by the 2010s, topping out in 2012 when a 721-million-ton tract went for $793 million to North Antelope Rochelle.

Those days are gone—after a decade of shrinking coal demand and a parade of bankruptcies.

How we got here:

• 2015: Cloud Peak Energy nominated West Antelope III; BLM kicked off review.
• 2019: Cloud Peak went bankrupt; NTEC later bought its PRB mines.
• 2024–25: NTEC didn’t push the lease for years. After the One Big Beautiful Bill passed in July, BLM approached NTEC and restarted the process.
• 15, 2025: BLM releases a Final Environmental Impact Statement with two options—deny the application or offer the tract for competitive sale.

State officials, including Kyle Wendtland at the Wyoming Energy Authority (who helped launch the lease back when he worked for Cloud Peak), are urging BLM to move the sale forward based on a current fair-market valuation and the country’s power needs.

BLM is moving quickly. Written comments on the Final EIS are due Sept. 21. If the agency proceeds, the tract would be sold via sealed bids—awarded only if the high bid meets BLM’s undisclosed fair-market value. With producers signaling caution, don’t expect a bidding frenzy.

Wyoming’s biggest new coal offering in years could still sell—but likely at lean prices. And thanks to lower royalty and tax rates, even a sale won’t refill state coffers like the old days. Whether the jobs and supply-chain activity outweigh a lower upfront check (and persistent market headwinds) is exactly the fight playing out now.

The original story by Dustin Bleizeffer for WyoFile.