Employees from BHP Billiton stand with New Mexico Coal asset president Pat Risner, center, during the signing of an agreement with the Navajo Transitional
Employees from BHP Billiton stand with New Mexico Coal asset president Pat Risner, center, during the signing of an agreement with the Navajo Transitional Energy Company to purchase Navajo Mine. (Photo courtesy of BHP Billiton)
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Farmington >> The Navajo Nation has thrown its hat into the coal mining business.

For years Navajo Mine has provided coal to the Four Corners Power Plant and while the land and coal belonged to the Navajo Nation, the equipment and personnel did not.

That changed Thursday when BHP Billiton and the Navajo Transitional Energy Company LLC, or NTEC, signed an $85 million purchase agreement.

Further details about the agreement were not released due to a non-disclosure agreement signed by the two parties.

"BHP Billiton is pleased to have worked with the Navajo Nation to secure the future of the mine and the benefits it provides to the Navajo Nation, employees, communities and other stakeholders," said Pat Risner, BHP Billiton's New Mexico Coal division asset president in a press release.

As part of the transaction, BHP Navajo Coal Company will remain the mine manager and operator until 2016 but will change its name to Navajo Mine Coal Company.

"This is a major endeavor for the Navajo Nation," said council delegate LoRenzo Bates.

The tribe, through NTEC -- the energy enterprise it created earlier this year -- will control its own destiny, retain revenues and preserve employment opportunities at Navajo Mine and the Four Corners Power Plant, he said.

Despite the hope, there remains the unknown, especially with federal regulations continuing to tighten on coal-fired power plants.

"It will have its challenges," Bates said then added that the tribe made a business decision and will stand behind it regardless of future outcomes.


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Both Navajo Nation President Ben Shelly and Navajo Nation Council Speaker Johnny Naize reiterated their support for the purchase agreement because it preserves jobs and general fund revenue for the tribe.

"For the Navajo Nation, we must remain vigilant to protect our vested interests in Navajo energy, and keep our eyes on the future because the work we do today is for our grandchildren," Shelly said in a press release.

Naize called the signing "a major milestone" in the acquisition process.

"I cannot stress enough, the importance of securing the 800 plus jobs that provide for the livelihood of hundreds of families," Naize said in a statement.

During the council's Oct. 16 discussion about waiving all liabilities for BHP Billiton, council delegate Russell Begaye sponsored an amendment to hold the coal company accountable.

But his amendment was called a "deal killer" and was not passed.

"I did not propose the amendment to kill the deal" Begaye said. "I wanted them to have the responsibility if they did anything wrong up to the (signing of the) agreement."

Throughout the process, Begaye said he asked for a detailed list of what equipment and infrastructure, including the number of draglines, dump trucks and railroad tracks, the tribe was purchasing and received no answer.

"We're not talking about a vehicle or buying a house," he said. "This is a multi-million, potentially, billion dollar asset."

Now that the purchase agreement is in place, the next step falls on Arizona Public Service, which is the majority owner of the Four Corners Power Plant.

APS has until the end of November to acquire Southern California Edison's portion of units 4 and 5 of the power plant and then sign a coal supply agreement expected to last until 2031.

Once those agreements are in place, ownership of Navajo Mine will transfer to NTEC on Dec. 1.

Noel Lyn Smith covers the Navajo Nation for The Daily Times. She can be reached at 505-564-4636 and nsmith@daily-times.com. Follow him on Twitter @nsmithdt on Twitter.