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Coal sales investigated by feds; no violations yet

February 8, 2013 • National News


FILE – This Aug. 22, 2006 file photo shows a coal mine seen from the air in northeast Wyoming near Gillette, Wyo. A spokesman for U.S. Sen. Lisa Murkowski said Friday, Feb. 8, 2013 that federal review has so far found no evidence mining companies knowingly skirted royalty rules as they’ve increased coal exports to Asia. (AP Photo/Nati Harnik, File)

BILLINGS, Mont. (AP) — The U.S. Department of Interior is investigating whether mining companies are skirting royalty rules as they increase exports of coal to Asia, federal officials disclosed Friday.

No violations have yet been issued, but a newly released report to two U.S. senators says audits of overseas sales have just begun for years when coal export volumes from federal lands grew substantially.

The investigation is focused on companies’ use of affiliates or brokers to sell coal from mines in the Western U.S. to customers in Asia. The parent company pays government royalties based on the mine price, then the affiliate ships the fuel overseas where it’s sold for many times the original price.

Interior Secretary Ken Salazar said he has asked the agency’s Office of the Inspector General to look into whether such actions violated federal law.

He said one federal coal lessee is under investigation for possible criminal violations. Details Login to read more

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