WASHINGTON, Tue Dec 4, 2012 — U.S. miners who are booking big profits on coal sales to Asia are enjoying an accounting windfall to boot.
By valuing coal at low domestic prices rather than the much higher price fetched overseas, coal producers can dodge the larger royalty payout when mining federal land.
The practice stands to pad the bottom line for the mining sector if Asian exports surge in coming years as the industry hopes, a Reuters investigation has found.
Current and former regulators say their supervisory work has lagged the mining industry as it eyed markets across the Pacific. They say they will now give the royalty question a close look.
“We are committed to collecting every dollar due,” said Patrick Etchart, spokesman for the Office of Natural Resources Revenue, which collects federal royalties.
At issue is the black rock pulled from the coal-rich Powder River Basin in Wyoming and Montana. Miners there say they abide by the letter of royalty rules that call for the government to get a 12.5 percent cut on coal sold under federal lease.