Introduction

The Surface Mining Control and Reclamation Act of 1977 (SMCRA) created the Office of Surface Mining Reclamation and Enforcement (OSM) in the Department of the Interior. SMCRA provides authority to OSM to oversee the implementation of and provide Federal funding for State regulatory programs that have been approved by OSM as meeting the minimum standards specified by SMCRA. This report contains summary information regarding the Alaska program and the effectiveness of the Alaska program in meeting the applicable purposes of SMCRA as specified in Section 102. This report covers the period of October 1, 1997 to September 30, 1998. Detailed background information and comprehensive reports from the program elements evaluated during the period are available for review and copying at the Olympia, Washington OSM Office.

The following list of acronyms are used in this report:

AML Abandoned Mine Land Reclamation

DMWM Division of Mining and Water Management

DNR Alaska Department of Natural Resources

EY Evaluation Year

GRP Gold Run Pass Mine

GVEA Golden Valley Electric Association

NOV Notice of Violation

OSM Office of Surface Mining

PFM Poker Flats Mine

PITS Permit Information Tracking System

SMCRA Surface Mining Control and Reclamation Act of 1977

TBR Two Bull Ridge Mine

TDN Ten-day Notice

TIPS Technical Information Processing System

UCM Usibelli Coal Mine, Inc.

WRCC Western Region Coordinating Center

II. Overview of the Alaska Coal Mining Industry

As reported in years past, Alaska is home to enormous known coal reserves, estimated to be roughly 170 billion tons; however, coal mining at present, does not contribute significantly to the overall state economy. Most of the economic benefits resultant from the coal industry are realized at the local level. At present, Healy, Alaska is the site of the only active coal mining in the State, and as such relies heavily on the economic contributions made possible by the mining.

The three active surface mines which encompass six separate permits are located in the Hoseanna Creek Valley and employ about 130-150 individuals and the adjacent Golden Valley Electric Association (GVEA) mine mouth power plant employs about another 40 individuals. Most of the coal mined in the Hoseanna Creek Valley is utilized by the GVEA plant; however, some coal is transported by rail and truck to other facilities in Fairbanks and to military installations throughout the State. The operator of the Hoseanna Creek Valley mines, Usibelli Coal Mine Inc. (UCM) also exports a portion of the coal to South Korea.

Not only is UCM the largest year-round employer in the Healy area, the company is very philanthropic, supporting many local activities. Baring any unforseen circumstances, there is good likelihood that production as well as employment opportunities will increase in the area because the UCM was issued a new mining permit for 2,500 acres just after the close of the 1997 Evaluation Year (EY). UCM is currently building an access road to the site of the Two Bull Ridge Mine (TBR) which is across the river from the Poker Flats Mine (PFM) and the Gold Run Pass Mine (GRP). UCM officials project approximately 2.1 million tons of coal being mined annually at TBR once the mine is at full production.

Also, UCM has recently assumed, through permit transfer, the lease/mining rights to two Division of Mining and Water Management (DMWM) permits located about 1 hour east of Anchorage, near the town of Sutton, Alaska. Considering that transportation concerns and costs often make Alaska coal economically unfeasible, the location of UCM's recent acquisitions might trigger increased interest in Alaska coal, especially for export markets.

Although no coal removal has occurred at the Sutton location, the permit transfers could be a positive indication that UCM is not only committed to coal removal in the Hoseanna Creek Valley but statewide as well.

III Overview of the Public Participation Opportunities in the Oversight Process and the State Program

As stated in the past, there has been little to no public interest in the Alaska coal program; this has been due both to the small scale of the Alaska coal industry and the remote location of the active mine operations. Until recently, there has been little interest on the part of the coal industry to expand existing mine operations or to pursue developing new sites; and, as a result, public interest in coal related activities has been virtually nonexistent.

The management of DMWM, in conjunction with OSM, has provided several opportunities during the past several years for public involvement in not only permitting activities/decisions but overall SMCRA program maintenance and administration. DMWM and/or OSM published public notices in the State's two largest newspapers located in Fairbanks and Anchorage, announcing DMWM decisions or public meetings at which input could be provided to State and Federal officials. Additionally, in 1997, the State mailed approximately 150 public outreach letters soliciting input concerning the administration of the coal program. Both of these approaches failed to generate any public involvement.

DMWM officials believed a more targeted approach was needed due to the size and remoteness of Alaska. DMWM contacted the Alaska Center for the Environment and asked if a representative would be interested in being part of a multi-interest discussion group including representatives from OSM, DMWM and the Alaska Coal Association. Although the Alaska Center for the Environment never formally accepted the State's proposal, the other parties have met several times during the past two years to discuss program related issues.

With the increased interest in the coal resources in the Sutton area and with a greater potential for impacts to the public, the DMWM felt a different approach to public involvement was needed. As previously indicated, Sutton is located approximately one hour east of Anchorage and has a much greater population density than most of Alaska. To notify the local citizenry of the proposed permitting actions, DMWM published the usual newspaper notices as well as posted information flyers throughout the Sutton area. The staff of DMWM has continued to keep the Sutton Community Council informed of the coal related activities in the area by attending Council meetings and arranging site visits for those interested in doing so. DMWM also arranged for representatives of UCM to attend some Community Council meetings during the evaluation year to answer citizens' questions concerning the permit transfers. DMWM management has realized the benefits of involving the local citizens as early as possible in the decision making process.

Although not specific to coal, the Alaska Department of Natural Resources (DNR), published in November 1997, a detailed and informative publication entitled, "Mining Reclamation in Alaska--Just Doing It Right". The 37 page publication focuses on reclamation requirements and practices employed by both the coal industry and the hard-rock mining industry. A chapter is dedicated to the sites reclaimed under the State's Abandoned Mined Lands Reclamation program(AML). Lastly, the publication recognizes the past recipients of the Alaskan Reclamation Award. This publication was widely distributed to interested parties as well as being available for general distribution to the public.

IV Major Accomplishments/ Issues/ Innovations in the Alaska Program

Early in the evaluation cycle, the DMWM approved a new permit application for a 2,522 acre mine located in the Hoseanna Creek Valley. The Two Bull Ridge Mine, operated by UCM, is the first new surface coal mine to be permitted in Alaska in many years. As indicated earlier, at full production, it is estimated that this mine will produce about 2.1 million tons annually.

The DMWM, with OSM concurrence, finally signed off on the earth work associated with a long standing Notice of Violation (NOV) issued to UCM for unstable out slopes at the company's Poker Flats Mine. Due to the scope of the abatement work and the shortness of the construction season, this was a multi-year project. DMWM expects the NOV to be fully abated next year, one year after vegetation has been successfully established. OSM worked with DMWM on monitoring the progress of UCM's abatement progress because the State issued the NOV in response to an OSM issued Ten-Day Notice (TDN). This issue is addressed in greater detail in Section VII, General Oversight Topic Reviews.

The State made a great deal of progress in developing a program-wide data management system. Although not completely finalized, the prototype tracks the permitting history of each mine, all bonding activities, insurance status, certified blasters and the current reclamation status of each permitted site. The coal Permit Information Tracking System (PITS) is being developed not only for in-house purposes, but also to aid the State in data transfer to OSM. OSM staff worked with DMWM staff in identifying common data needs so as to make the system as useful to both agencies as possible.

The State made a concerted effort to finalize its Program Amendment VII submission during the evaluation cycle. DMWM staff working with WRCC's bonding specialist, received approval of the amendment which addressed permitting and bonding issues, most notably, provisions to allow for self-bonding by qualified operators.

Overall, the DMWM is administering the Alaska Surface coal Mining Control and Reclamation Act in an effective manner. There appears to be improved communication and cooperation between DMWM and UCM, the only current active operator, concerning planning and permitting activities. OSM expects this situation to continue.

V Success in Achieving the Purposes of SMCRA as Determined by Measuring and Reporting End Results

To further the concept of reporting end results, the findings from performance standard and public participation evaluations are being collected for a national perspective in terms of the number and extent of observed off-site impacts, the number of acres that have been mined and reclaimed and which meet the bond release requirements for the various phases of reclamation, and the effectiveness of customer service provided by the State. Individual topic reports are available in the Olympia, Washington Office which provide additional details on how the following evaluations and measurements were conducted.

A. Off-Site Impacts

On September 28 and 29, 1998, an OSM Reclamation Specialist from the Olympia Office conducted inspections at three active mines located in the Hoseanna Creek Valley. He was accompanied by an OSM Hydrologist from OSM's Western Region Coordinating Center (WRCC) as well as mine representatives. The focus of the inspections was drainage control structures, slope stability, erosion control and blasting records. As previously stated, mining in the Hoseanna Creek Valley occurs in a rather sparsely populated area, and as such, there is no record of public concern over the mining activity being conducted there. All drainage control systems were functioning properly and no off-site impacts were observed. Some questions arose as to maintenance at one of the ponds. See Mine-Site Evaluation Inspection Report (MEIR) on file at OSM's Olympia Office for more details.

All blasting records were reviewed and found to be in order. Although no off-site impacts caused by erosion were observed, State and OSM inspectors were concerned by the amount of on-site erosion developing at the Poker Flats Mine. State staff and UCM staff have been monitoring the increased erosional activity at the mine, partially caused by an extremely rainy year, and are developing monitoring and reclamation strategies.

B. Bond Release

As Table 5 shows, the State did not receive nor process any Phase I, Phase II or Phase III bond release applications during the evaluation period.

C. Customer Service

As previously stated in Section III, there has been little involvement by the public in Alaska's coal program. The DMWM has actively sought to increase public awareness and involvement. Not until UCM's recent leasing/permitting activities in the more populated Sutton area, has the public shown much interest in coal related issues. As discussed previously, the DMWM published in November 1997, an informative publication profiling its responsibilities in both hard-rock and coal mining operations, focusing on reclamation.

VI OSM Assistance

The level of assistance provided to Alaska during this evaluation period remained fairly consistent with previous years. As in previous years, staff from OSM's Technical Information Processing System (TIPS) provided both technical support for Alaska's TIPS system and on-site training relative to TIPS specific software. Also, DMWM staff attended training provided by WRCC's Office of Technology Transfer and OSM's National Technical Training Program.

During the evaluation period, routine assistance was provided to DMWM in the areas of permitting, inspection/enforcement, program maintenance and data management. A State program amendment was approved during the evaluation period. OSM provided assistance to Alaska in the finalization of the amendment package.

OSM provided technical support to DMWM in evaluating the final stage and completion of UCM's slope stability project at the Poker Flats Mine. The slope work was required as part of the abatement measures necessary to address a DMWM initiated NOV issued in response to an OSM issued TDN.

OSM's Olympia Office has an excellent relationship with the DMWM staff, and as such many informal conversations occur in which various issues are discussed. Often suggestions are offered and ideas are exchanged that don't necessarily constitute formal assistance; but as long as both parties are comfortable with such an arrangement, it will continue.

VII General Oversight Topic Reviews

As in previous evaluation cycles, OSM and DMWM have chosen to keep the program oversight process both simple, focusing on a few key program areas of mutual concern / interest, and flexible, being able to adjust oversight objectives if necessary. This approach is both possible and desirable due to the smallness of the Alaska program and the coal industry currently operating in the State. The openness and solid lines of communication between the DMWM staff and the OSM Olympia staff contributes greatly to the success of this approach. There is no permanent Alaska oversight team in place; all oversight activities are conducted by an Ad Hoc team that changes according to the selected review topics.

As discussed in the Annual Evaluation Plan, OSM and DMWM identified some specific program areas that both agencies believed warranted evaluation. The program areas identified were:

• Ongoing evaluation of Poker Flats Mine slope stability project
• DMWM's program maintenance efforts
• Evaluation of DMWM's implementation of its Field Directive System

Additionally, OSM reviewed several other general program areas and gathered some routine data as agreed upon in the Annual Evaluation Plan.

Summary of Topic Reviews

• The Central and Eastern buttress structures have been constructed as designed at the Poker Flats Mine as part of the long-term solution to the slope stability problems in a reclaimed area. Computer analysis and field observations indicate the buttresses are conservatively built and that the length, width, and height of the buttresses meet design requirements. Some slumping and erosional features have developed on the buttresses, but overall stability and function of the structures have not been impaired. However, the buttresses do require some minor rehabilitative measures and long-term monitoring. In addition, several terrace channels and down drain structures require repair and/or maintenance.
• The DMWM finalized Program Amendment VII, addressing primarily permitting and bonding issues, and received OSM approval during the evaluation period. The Federal Register notice announcing OSM's approval was published after the close of the evaluation period.
• OSM evaluated DMWM's implementation of its Field Directive System. A Field Directive is an enforceable order of the DMWM that provides to an operator, a written record of on-the-ground issues or concerns that warrant attention. Each Field Directive clearly identifies the inspector's concern and date by which the concern must be addressed. From OSM's evaluation and from discussions with DMWM staff and coal industry officials, it seems that the Field Directive System is getting quicker resolution of issues with much less administrative burden being placed on the State and with much less contention from the industry.

For more information on these oversight topics, or any other aspect of the 1998 annual oversight process, feel free to contact:

Office of Surface Mining
Evergreen Plaza Building, Suite 703
711 Capitol Way
Olympia, Washington 98501
(360) 753-9538
Attention: Glenn Waugh

APPENDIX A:

These tables present data pertinent to mining operations and State and Federal regulatory activities within Alaska. They also summarize funding provided by OSM and Alaska staffing. Unless otherwise specified, the reporting period for the data contained in all tables is October 1, 1997 to September 30, 1998. Additional data used by OSM in its evaluation of Alaska's performance is available for review in the evaluation files maintained by the Olympia, Washington OSM Office.

^ACoal production as reported in this table is the gross tonnage which includes coal that is sold, used or transferred as reported to OSM by each mining company on form OSM-1 line 8(a). Gross tonnage does not provide for a moisture reduction. OSM verifies tonnage reported through routine auditing of mining companies. This production may vary from that reported by States or other sources due to varying methods of determining and reporting coal production.

TABLE 2

TABLE 3