Peabody Coal buys coal from U.S. taxpayers for cheap, sells it abroad for huge profit
Yesterday, I wrote about the issue of public land in the Powder River Basin being leased to coal companies for cheap, so they can strip-mine it and sell the coal abroad at an enormous profit.
Also yesterday, the feds held a “competitive lease sale” for the South Porcupine Tract, which contains almost 402 million tons of mineable coal.
Guess how many companies bid in this “competitive auction”? One: Peabody Coal, the company that filed the original application [PDF] for the lease.
Again: $1.11 per ton.
The price of a ton of Powder River Basin coal on U.S. spot markets? $9.15 per ton, as of May 11.
And exports are only likely to go up:
So, to summarize: You, the U.S. taxpayer, just leased another huge chunk of your land to Peabody Coal at $1.11 per ton of coal. Peabody will strip-mine that land and take the coal to China, where it will sell it for over $100 per ton. Peabody pockets enormous profits*, the U.S. taxpayer gets devastated land, and China accelerates global warming.
And it’s all being pushed through by the Obama administration.
* Now, obviously, $1.11 per ton is not the sum total of Peabody’s costs. They also pay BLM some production royalties and rental fees. And of course it costs them money to mine the coal and ship it to China! Nevertheless, the notion that $1.11 per ton is “fair market value” for coal that Peabody is going to tell for over $100 a ton is a sad joke.
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