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J O~OW CARBON & MINERALS, INC• III IIIIIIIIIIIIIIII COAL LEASE MODIFICATION APPLICATION C-53510 999 COAL RIGHT-OF-WAY COC-59584 ENVIRONMENTAL ANALYSIS U-96-27 PURPOSE AND NEED The Colorado State Office of the Bureau of Land Management (BLM) received on April 2, 1996, a coal lease modification application from Oxbow Carbon & Minerals, Inc., (Oxbow). In addition, Oxbow submitted aright-of-way (R/W) application for an underground tunnel system to the BLM Montrose District Office on June 5, 1996. The purpose of this environmental assessment (EA) is to evaluate potential impacts of the lease modification and R/W on the physical and socioeconomic environment and to develop mitigating measures to be included as lease and/or R/W stipulation as needed. The proposed R/W would lie adjacent to the proposed coal lease modification application and the existing coal lease. The proposed tunnel system will be used to drive underground mains and submains to provide Oxbow with a means of access to coal reserves requested under the proposed coal lease modification described above. The land subject to the proposed R/W was not included in the lease modification because to do so would have increased the amount of acreage subject to the modification in excess of the limitation set forth in 43 CFR 3432 (i.e. 160 acres). The proposed R/W would be granted under Title V of FLPMA and regulations at 43 CFR 2800 for a three year term. It is necessary to use public lands for the tunnel system because the only means of access to the coal reserves is from federal lands. Oxbow proposes to begin construction of the tunnel system in approximately September, 1996, and expects to utilize the tunnel system for approximately two and qne-half years, subject to changes in its mine plan. The coal lease modification application was submitted under the Mineral Leasing Act of 1920, Federal Coal Leasing Amendments Act of 1976, and 43 CFR 3400. The coal reserves are managed by the Montrose District Office of the BLM. The coal lease modification application area lies to the east of federal coal lease COC-53510, leased in 1992 for 1339.56 acres of B and C Seam coal reserves. The modification is needed to extend the Sanborn Creek Mine Plan in an easterly direction. The addition of the modification area and the RNV would allow for the extension of mining operations into recoverable B Seam federal coal reserves. The terms and conditions of coal lease COC- 53510 will apply to this modification and are located in,Appendix B. The modification area is described as follows: T13S., R.90W., 6th Principal Meridian, Sec. 1: Lots 11, 12, 13 and 20, containing approximately 157.55 acres in Gunnison County, Colorado. The R/W area is located within the north half of Lot 1, Sec. 12, T.13S., R.90W., 6th Principal Meridian. See Map 1 for the location of the coal lease modification and R/W areas. In response to the modification application submitted by Oxbow, the BLM reviews the coal lease modification application in accordance with the regulations found at 43 CFR 3432. The modification serves the interests of the United States, there is no competitive "~"" interest in the deposits, and the deposit cannot be developed as part of another potential