Aussie firm wins coal bid

SUTTON - An Australian company has won with its bid to potentially mine for coal on nearly 10,000 acres of a state trust's land near Chickaloon.

According to a press release issued late Thursday, Riversdale Alaska LLC., a wholly owned subsidiary of the Australia mining outfit Australian Riversdale Resources Pty Ltd., submitted the winning $3 million bid.

In addition to the bid, the company will pay the Alaska Mental Health Trust Authority $4 per acre per year in rent adjusted every five years, plus 5 percent of income from any coal mined there.

"The goal for issuing any coal or mineral lease ... on trust land is to obtain royalty payments for the value of the resource and to provide a long-term revenue stream for beneficiary programs," according to an AMHTA press release.

The trust cites as the firm's experience a coal mine in Mozambique that Riversdale management oversaw until Rio Tinto Ltd. bought it for $4 billion in 2010. According to business news outlets and the company's website, Rio Tinto also took over majority control of Riversdale last spring, completing its acquisition of the company in the summer.

"Rio Tinto is one of world's largest mining operators, and has one of the worst environmental records," said Castle Mountain Coalition president Kirby Spangler. "This is a tragedy for the people of Alaska, especially for those living in Chickaloon and throughout the Matanuska Valley."

The company will have to apply for a permit before it can explore the tract, which is believed to contain high-quality, low-sulfur bituminous coal. All of those adjectives are often used to describe the coal found in the Sutton-Chickaloon area of the Valley.

"Riversdale will need to secure an exploration permit from the Department of Natural Resources in order to evaluate the geology and determine if any of the coal resources can be mined," according to the AMHTA press release.

Were Riversdale to begin looking at the possibility of returning mining to the Valley, it would not be the first. Usibelli Coal Mine, which submitted one of the losing bids on the Chickaloon tract, is also mulling the economics of mining for coal just north of Palmer.

The Wishbone Hill coal project has been the subject of rancorous debate in the Sutton area with community voices raised both for and against the proposed mine. Those opposed to the mine cite potential pollution and safety concerns, while proponents cite potential jobs and other economic benefits.

"This should serve as a wake up call to those who support the Wishbone Hill Mine under the false impression that an Alaskan owned company like Usibelli Coal will be a good thing for the Mat-Su," Spangler said. "Big Coal has its sights on the Matanuska Valley."

Most recently, the federal government put the state on notice that it had 10 days to respond to complaints that Usibelli might be operating without a permit as it explores its leases. If the state finds Usibelli's permit is invalid, the coal company would have to reapply.

Contact Andrew Wellner at andrew.wellner@frontiersman.com or 352-2270.