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,;,, <br />~' <br />UNITED STATES DEPARTMENT OF THE INTERIOR <br />BUREAU OF LAND MANAGEMENT <br />Washington, DC 20240 <br />In Reply Refer To: <br />SEP 2 7 2002 3485 <br />{COC 61209} <br />MEMORANDUM <br />To: State Director, Colorado <br />t~~ <br />From: Deputy Assistant Director, Minerals, Realty, and Resource Protection <br />Subject: Concurrence with the Royalty Rate Reduction for Federal Coal Lease COC <br />61209; Bowie Resources, Ltd.; Bowie #2 Mine. <br />We have reviewed the Bureau of Land Management (BLM) Colorado State Office's analysis <br />and recommendation to approve a Category 1 royalty rate reduction for Federal coal lease <br />COC 61209 ,which is currently controlled by Bowie Resources, Ltd. (BRL). We agree that <br />the statutory requvrements of greatest ultimate recovery, conservation of the resource, and the <br />condition that the lease cannot be successfully operated under the lease terms have ail been <br />met. <br />We agree with your concerns that there are unique and adverse economic and geologic <br />conditions which may jeopardize the continued operation of the Bowie #2 Mine. We concur <br />with your recommendation to grant a Category 1 royalty rate reduction from the lease royalty <br />rate of 8.0 percent to 5.0 percent. The effective date of the royalty rate reduction will be <br />May 1, 2002. The term of the royalty rate reduction will not exceed the production of <br />1,900,000 tons, or for a period of not more than two yeazs after the effective date, whichever. <br />occurs first. <br />Please ensure the application is in compliance with all applicable guidance including the lease <br />account being in good standing with the Minerals Management Service. •-'` <br />Please be sure the Colorado Governor's Office is notified of the application and thealsroposed <br />decision prior to any written or oral commitment to BRL. The Governor's concurrence needs <br />to be obtained prior to approval. <br />If you have any questions, please contact William Radden-Lesage, Mining Engineer, Solid <br />Minerals Group, (WO-320), 202- 452-0360. <br />~~ ~r~ <br />