The Big Metal option and exploration agreements were signed on January 24, 2013 and approved by the Bureau of Indian Affairs on June 14, 2013.
The terms of the agreements provide options to lease and develop northern Powder River Basin coal on the Crow Indian Reservation in southeast Montana, near Cloud Peak’s Spring Creek mine.
“Prior to any exercise of the options, one of the next steps in the Big Metal project is exploration drilling to confirm coal quantity and quality,” Cloud Peak Energy business development senior vice-president Todd Myers said.
Exploration drilling is designed to collect information to determine the thickness, depth, consistency and quality of the coal seams.
Data will be collected within the area by drilling 6-inch diameter holes from the surface and into the coal seams.
Following completion of drilling, the drill site will be reclaimed according to an approved reclamation plan.
The Bureau of Land Management will carry out pre-inspection, periodic and post-inspections of each drill site as well as at points along access routes connecting the sites.
Cloud Peak Energy has already paid a total of $US5.25 million ($A5.62 million) in option payments to the tribe and will make additional annual payments during the remainder of the five-year option.
Total payments are predicted to reach $10 million.
Cloud Peak Energy has also been providing $75,000 a year for post-secondary education scholarships for eligible tribe members.