July 17, 2008

Crow Tribe wants to exploit coal


AUTHOR: Mathew Brown

They tried casinos on the Crow reservation. The one designed to bring in the biggest crowds, Res-a-Vegas, went broke within a year and has been converted to a fireworks stand. But now the Crow are convinced a really big jackpot lies below the surface: coal.

Crow tribe wants to tap vast coal deposits

With energy prices soaring, the poverty-stricken Crow want to tap the vast deposits underneath their 2 million acres (810,000 hectares) of land. The tribe estimates the ground contains 9 billion tons (8.16 billion metric tons) of extractable coal, or enough to meet the nation’s needs for almost a decade.

“We’re not just trying to help ourselves today,” said Joanie Rowland, who directs the 12,000-member tribe’s nascent energy program. “We want to set up the reservation so that it will prosper and help the future generations.”

Federal red tape, turbulent tribal politics that can scare off big business, and environmental worries have prevented some of the West’s tribes from fully exploiting their oil, gas and coal deposits. But now, rising demand for energy – along with new federal laws giving Indians more say over their mineral resources – could help the Crow and other tribes get their way.

“There’s a misconception about Indian tribes that they all have big gaming revenues. We don’t have that,” said tribal Chairman Carl Venne. “But we do have vast resources.” He added: “The window of opportunity is open.”

Powder River Basin produces nearly half the nation’s coal

The Crow reservation lies about 60 miles (100 kilometers) from the nearest city of any consequence, Billings. It is on the remote northern edge of the Powder River Basin, which produces nearly half the nation’s coal and hundreds of billions of cubic feet (cubic meters) of natural gas annually.

Unemployment and poverty high on the Crow Reservation

Life on the reservation, however, is defined by a different set of numbers: 47 percent unemployment; a per capita income of just $7,400 (one-third the national average); and federal health care subsidies that run dry six months into the year.

Much of the land on the reservation is used to grow wheat and sugar beets and to raise cattle.

The tribe is looking to extract the coal and build a multibillion-dollar, coal-to-liquids plant that would process the rock into diesel and other fuels. Tribal leaders say if they could tap their underground riches, they could expand their clinic and upgrade the reservation’s aging roads and water system.

Not all the tribe’s coal remains buried. An outside company has been extracting coal since 1974 from a mine just off the reservation. Since the tribe owns the mineral rights, it has been receiving royalties – about $10 million last year alone.

But tribal leaders say that is not enough to relieve the reservation’s poverty. And rather than just leasing land and collecting royalties, they want to become an actual partner in such projects.

Crow Reservation rich in natural gas and oil deposits

The reservation also has natural gas and oil deposits, and the tribe is working to exploit those, too, but the coal is believed to hold a much bigger potential.

Around the country, at least a dozen Indian tribes are pushing for agreements with the government that would help them exploit their oil, gas and coal, said Robert Middleton, director of the Interior Department’s Office of Indian Energy and Economic Development.

Nationwide, energy royalties paid to tribes have doubled over the past five years, to $475 million in 2007, according to the government’s Minerals Management Service. The increase was driven primarily by rising oil and gas prices, not by new projects. Actual production remained flat.

Two million acres of tribal land have so far been developed for oil, gas and coal, according to the government. Estimates show an additional 15 million acres have the same potential.


This article first appeared in Indian Country News.

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