US to consider sharp hike in royalties from coal mines

BILLINGS, Mont. – Federal officials will consider hiking royalty rates by 50 per cent on coal extracted from massive strip mines on public lands under a pending overhaul of a U.S. Interior Department program.

The first outlines of a planned three-year evaluation of the government coal program were released Thursday. Lower royalty rates to stimulate mining also will be considered.

The Obama administration in January imposed a moratorium on new coal leases to address the costs of climate change and ensure a fair financial return to taxpayers. Interior spokeswoman Jessica Kershaw says Thursday’s notice sets “sideboards” for that review.

The royalty increase from 12.5 per cent to 18.75 per cent would apply to coal from strip mines primarily in Western states. Wyoming and Montana are home to many of the largest mines.


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