Alaska News

Feds question permits for Wishbone Hill coal mine in Mat-Su

The U.S. Department of the Interior's Office of Surface Mining is questioning the state's permitting of the Wishbone Hill coal mine, saying the permits may not comply with state law and regulations.

In a letter to the state Department of Natural Resources following a citizen complaint, the federal Office of Surface Mining (OSM) Denver Field Manger, Kenneth Walker, gave the state 10 days to determine if additional information is available.

"We have reviewed things and there are areas that raised questions that additional information may not have been submitted," Walker said.

The federal Office of Surface Management was created by Congress in 1977 and is charged with balancing the need for continued domestic coal production with protection of the environment.

Russell Kirkham, coal program manager for the state Department of Natural Resources, said his department is scouring its archives, looking for information that might have been misfiled or misplaced. The state has until Aug. 2.

Hundreds of families nearby

Mine opponents are calling the letter a victory, saying it validates their contentions.

Usibelli Coal Mine has owned the permit since 1997. Spokeswoman Lorali Simon said the OSM stance is another example of the anti-coal Obama administration caving in to extreme environmental organizations.

"Here you have the federal government second-guessing state decisions that happened 16 years ago, arguments that aren't based on policy initiatives or flaws," she said. "Their arguments are based on minor procedural issues, nothing substantive."

The Wishbone Hill coal mine, located close to Sutton in the Matanuska-Susitna valleys, could contain up to 6 million tons of coal reserves, of which about 500,000 could be extracted annually for about 12 years. While the mine is small, the type of coal at Wishbone Hill is high in heat content but low in sulfur. The mine's location on the road system makes transportation easier -- but the proposed location has come under fire from critics, too. Hundreds of families live within three miles of the proposed mine according to Kirby Spangler, president of the Castle Mountain Coalition, an opponent. The mine would put residents of Buffalo Mine Road, just a quarter mile from the proposed open pit, at risk, he said.

'Need to be watched'

Spangler said the original permit is out of date. It was issued more than 20 years ago, long before the Mat Su's population exploded. Few lived in the area when the permit was issued, he said.

Spangler questioned the entire Department of Natural Resources' permitting process.

"No, DNR is not paying attention to this," he said. "They make really basic mistakes that have serious consequences for people who live near this project. They need to be watched."

Questions over extensions

Since 1991, the Wishbone Hill Coal Mine has seen a variety of owners. In 1994 it was transferred from Idemitsu Alaska to the North Pacific Mining Corporation (NPMC), which transferred it to Usibelli in 1997.

But before transferring the permit, North Pacific asked the Natural Resources department for an extension so it could continue seeking a partner to help develop Wishbone Hill. It did not, according to the letter, specifically request an extension to the start of mining activities. Under state statutes, a permit can be terminated if surface work does not begin within three years.

The state sent North Pacific a letter noting that the "justification is weak when compared to the wording in the statute" and said North Pacific needed to address its justification. The letter says there is no mention of additional justification in the file.

Natural Resources went on to approve North Pacific's application for permit renewal, but did not explicitly grant an extension of time.

From the evidence available, the Office of Surface Mining writes, "DNR did not lawfully grant an extension of time to commence mining operations. Consequently, it would appear that the permits terminated as a matter of law, and the DNRs purported renewal of the permits (in 2002 and 2006) was also invalid."

The state disagrees. In a January letter to Walker, Kirkham of Natural Resources writes that the 1996 public notice for permit renewal contains a statement that there was a request for an extension and DNR granted it.

"To read this language in the public notice as anything other than an acknowledgement, albeit indirect, that an extension was requested and granted would be illogical."

Evidence doesn't exist

Lawyer Tom Waldo represents the Chickaloon Village Traditional Council, a small village of about 300 near Sutton. He said it seems unlikely the state will uncover enough information to keep Usibelli's permit alive.

"If they had granted those kinds of extensions, and if the grounds had existed, DNR would have pointed that out," Waldo said. "The reality is, the circumstances for extending the permit just didn't exist."

Jeremiah Millen, executive director of Friends of Mat Su, said he is encouraged by the federal findings that, he says, back up his group's claims.

"We've done our homework, it's been requested before. (DNR) just failed to produce," he said.

Simon said Usibelli would do everything it can to assist the state in supplying information Office of Surface Management might need.

Usibelli has followed all laws and regulations in regards to the mine, Simon said. The company has already spent millions of dollars on the project, most of which went toward studying environmental concerns.

"(Usibelli) will be a constantly moving target by these groups," she said. "We stand by our legitimate, valid permits."

Contact Suzanna Caldwell at suzanna(at)

Suzanna Caldwell

Suzanna Caldwell is a former reporter for Alaska Dispatch News and Alaska Dispatch. She left the ADN in 2017.