Nez, Lizer end indemnity agreement for NTEC

Noel Lyn Smith
Farmington Daily Times
A coal hauler operates at the Cordero Rojo Mine, located approximately 25 miles south of Gillette, Wyoming.

FARMINGTON — Navajo Nation President Jonathan Nez and Vice President Myron Lizer have ended the surety agreement that the Navajo Transitional Energy Company was eyeing to use to secure reclamation bonds for coal mines it acquired in August.

Nez cited protecting the tribe's finances as reason for terminating the general indemnity agreement on Nov. 12.

"The Navajo Nation's financial portfolio as well as our resources would be placed in a state of uncertainty if we allowed NTEC to proceed with finalizing the bonds needed to operate these three mines using the nation's consent given in these indemnity agreements," Nez said in a press release from his office.

"In addition, many experts question the viability of expanding our interests in a coal market that appears to be dwindling. We will not support initiatives that attempt to circumvent or undermine the laws and policies of our nation," he said.

NTEC, which is an enterprise of the Navajo Nation, purchased in August the Cordero Rojo and Antelope mines in Wyoming and the Spring Creek Mine in Montana from Cloud Peak Energy.

The transaction was part of bankruptcy proceedings by Cloud Peak Energy in federal court in Delaware.

In a company statement on Nov. 12, NTEC said it respects the decision by Nez and Lizer on behalf of the Navajo Nation.

Delegate Eugene Tso, left, speaks with Navajo Nation Vice President Myron Lizer and President Jonathan Nez after the State of the Nation address on July 15 at the tribal council summer session in Window Rock, Arizona. Nez and Lizer terminated an agreement that would have pledged Navajo Nation money to expand investments in the coal industry at a time when that industry is facing an uncertain future.

"Regardless, Navajo Transitional Energy Company remains a profitable, viable and successful business entity of the Navajo Nation. As such, we will explore our options to best serve our interest as NTEC and the Navajo Nation," the statement said.

Tribal leaders and NTEC have been in discussion since August about how to secure reclamation bonds for the three properties, a necessary process for obtaining operating permits.

NTEC proposed using the general indemnity agreement authorized by the tribal leadership in 2013, then amended in 2015, for purchasing the Navajo Mine from BHP Billiton New Mexico Coal.

Several members of the Navajo Nation Council expressed concern about issuing such support because it would place the tribe's financial portfolio at risk due to the current state of coal sales.

The indemnity agreement was authorized to NTEC in 2013 by the 22nd Navajo Nation Council and by then-president Ben Shelly. The company was established that same year and was still developing itself financially and as a business.

The release from Nez and Lizer's office states the bonds issued for the Navajo Mine purchase and any related to the Four Corners Power Plant, will remain in place and are not affected by the termination.

Navajo Mine is the sole coal supplier for the power plant, located on tribal land near Fruitland.

Both men further explained their decision for ending the agreement, citing concern over the lack of information by NTEC for costs associated with reclamation bonds for the Wyoming and Montana mines and explaining the company's overall financial status.

"NTEC has not provided the nation's leaders with detailed information regarding its financial performance and outlook, so we should not be placed in a position to provide financial backing for NTEC without that critical information," the release states.

Noel Lyn Smith covers the Navajo Nation for The Daily Times. She can be reached at 505-564-4636 or by email at

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