Inspector General Report on US Coal Leasing Programs

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Coal-burning power plants generate about half of the Nation’s electrical power. About 40 percent of the Nation’s coal comes from public lands. As a result, coal mining on public lands is a significant source of revenue to the U.S. Government, and significantly contributes to the Nation’s power supply.

We focused on the program’s goal of obtaining a fair return for coal on public lands, its mine inspection and enforcement activities, and venting of methane gas from mines. We found weaknesses in the current coal sale process that could put the Government at risk of not receiving the full, fair market value for the leases. For instance, we identified lost bonus revenues of $2 million in recent lease sales and $60 million in potentially undervalued lease modifications. In addition, flaws in the inspection and enforcement program could prevent BLM personnel from detecting noncompliance with laws, regulations, and lease terms. We did not find evidence that mines improperly vented methane gas.