New America Media News Report
23 March 2010
When Navajo activist Anna Frazier heard the
news last December, she immediately understood that the seemingly
small act was a big deal.
For the first time, the Navajo tribal
government would open to the public its negotiations with Peabody
Energy over its royalty rates for coal extracted at Black Mesa’s
Kayenta mine. Instead of rubber-stamping another 10-year lease
with Peabody, there would be open discussion of the lease
agreement that brings millions of dollars to the Navajo Nation and
earns many more millions for Peabody, the largest coal mining
company in the world.
Pressure from community members like Frazier
induced the Navajo government to negotiate the lease in public.
And that reflects a growing environmental activism among tribal
members, who are asking more questions about Peabody and their
nation’s reliance on coal. They also have stepped up their
organizing. The proposed public hearings on the coal lease is the
latest in a series of victories won by Navajo citizens over the
last few years. It demonstrates a steady chipping away at the
authority of their tribal government and greater participation by
citizens as political decision-makers, especially on the
contentious issue of transitioning away from a coal-based economy.
Frazier, a silver-haired, plain-speaking woman,
is a coordinator with Dine CARE (Citizens Against Ruining our
Environment), a Navajo environmental organization. She has spent a
lifetime protesting against uranium and coal industries that have
ravaged the land and sickened people. Although the Navajo economy
is heavily dependent on coal, coal profits have not enriched the
lives of regular Navajos, in part because coal-mining leases
renegotiated in the 1980s capped royalty rates way below market
That is one reason tribal activists were
determined to renegotiate the coal royalty rate through public
debate. The Navajo Nation and Peabody renegotiate the coal royalty
rate only once every decade, and this time around, Frazier says,
community members want to have their say. The tribal council says
it will make a decision on the lease in April.
“Our Navajo people didn’t negotiate because we
didn’t know anything about finances,” Frazier said, “but today we
do. Our people are educated and know the value of the dollar. It
really needs to be put back on the table.
“We’re asking that [the agreement] be
publicized, so all Navajo and Hopi can see exactly what the Navajo
tribe is negotiating,” said Frazier.
The decision has raised eyebrows. Andy Bessler,
southwest coordinator for the Sierra Club based in Flagstaff,
Ariz., says the move is significant because it shows tribal
members are demanding a new level of transparency in the tribe’s
relationship with Peabody.
“The central government plays a role, but these
are people’s homes, and they’ve been really left out of the
discussion,” Bessler said. “We need to hear from them. What are
the details here, what are the royalty rates, what are the
benefits and costs?”
The coal lies beneath Black Mesa, in
northeastern Arizona, part of the sacred ancestral land of both
the Navajo and Hopi. Jointly owned by both tribes, the coal found
there is highly prized for its low sulfur and high BTU. But
Frazier and other tribal members say regular Navajos and Hopi have
not benefited from sales of Black Mesa coal. The royalties the
Navajo Nation receives from Peabody are now capped at 12.5 percent
of the market price of coal. Peabody earned $6 billion in revenues
Roger Clark, air and energy program director
with conservation group Grand Canyon Trust, says the royalty
figure needs to be translated into price per ton. The 8 million
tons of coal needed to power the Navajo Generating Station in
Page, Ariz. nets the Navajo Nation $24 million in annual revenue,
or $3 per ton, according to Clark. Meanwhile, coal sells on the
global market for much more – anywhere between $40 and $100 per
ton, he says.
“Basically, the tribes were given below-market
value all the time, and basically expected to accept it because
they were being held economic hostage,” Clark said.
Peabody spokesperson Beth Sutton says that the
company’s arrangement with the Navajo Nation is fair. “The lease
agreements with the Navajo Nation and the Hopi Tribe are among the
most lucrative in the industry, generating significant annual
economic benefits through royalties, bonuses, NTUA payments and
other fees,” said Sutton, in an email response to a request for
comment. “The 12.5 percent royalty rate is the standard federal
royalty rate, the rate the Navajo charges to other coal companies,
and a rate the Navajo has agreed to on multiple occasions. The
agreements also include bonus payments.”
Those payments include a $3.5 million bonus, a
one-time payment of about $1.5 million, and $250,000 a year in
scholarships for Navajo youth through 2017.
In a statement, George Arthur, chairman of the
resources committee of the Navajo Nation Council, argues that the
tribe should retain the royalty rate as it is “and not to take
into consideration the closed mine.”
Operations at the Black Mesa mine halted after
the closure of the Mohave coal-fired power plant in Laughlin,
Nev., in 2005. (The Kayenta mine remains open.) “In essence,” he
said, “we have gained although the rate stayed the same.”
But the status quo is starting to crumble under
activist pressure. In another recent victory for tribal
environmental and community groups, a federal judge earlier this
year denied a crucial permit that would have allowed Peabody to
re-open and expand mining operations at the Black Mesa mine – one
of two mines in the Black Mesa region. The judge denied the permit
because Peabody failed to conduct an environmental impact
assessment and include public participation.
Now tribal activists are turning their
attention to the Navajo Generating Station. The U.S. Environmental
Protection Agency is weighing whether to impose tougher air
pollution controls on the plant, which would cost $1 billion,
according to a Hopi press release. About two dozen tribal
environmentalists and their allies met privately with EPA Region
IX Head Jared Blumenfeld on March 2 in San Francisco to lobby for
the pollution retrofits.
Frazier was among the tribal activists. She
spoke about the harm to her people from coal mining and coal-fired
power plants. “It’s cost our people, it has cost our lives and
land and we’re losing water from [mining]. We have to think about
the future of our people,” she said, during a phone interview.
Unlike her tribal government, which has long relied on coal
revenue to prop up its economy, Frazier says she wants to see an
end to coal royalties one day.
So does Wahleah Johns, who traces her Navajo
roots to Black Mesa. Johns says the costs of the coal economy on
her people and the land far outweigh the monetary gains. She says
the coal industry has devastated tribal communities by
contaminating and depleting waterways and springs, littering the
land with waste sites, pushing people off their land, and
jeopardizing the health of tribal communities.
Johns heads the Black Mesa Water Coalition, one
of the groups that urged tribal leaders to publicize the agreement
in the community and ensure that lease terms benefit all Navajos.
Despite the Navajo Nation Council directive, no
public hearings have been held on the reservation so far. But,
that hasn’t stopped tribal leaders like Johns from gearing up.
Black Mesa Water Coalition and other grassroots
groups organized a one-day training on March 13 to inform
community members about the toll of coal mining and power plants
on land, water, air and human health, and to come up with
alternative ways to grow the economy.
“The goal is to diversify our economies and
create more jobs than what is currently in our communities,” Johns
said. “And this has to be guided by the local community members
from Black Mesa who are supported with the right tools to make
decisions that don’t have to sacrifice our Mother Earth and
environment for survival.”
Her group is pushing to install solar panels on
abandoned mine lands. Johns envisions the community co-owning the
concentrated solar power plant.
“There’s a lot of reclamation land. How can we
add value back to land that has gone through mining…and how can we
give back to the community?” asked Johns, who plans to present the
proposal to tribal council members in April.
Bessler and Clark say tribal community members
may not succeed in getting a higher coal royalty rate, but Navajo
citizens can push for added value in the leases that ensure
greater community benefits, such as the use of abandoned mine
There’s an opportunity to do that now with the
closure of the Black Mesa mine, Bessler says, because there are
still many questions about what will happen to the infrastructure
there. Should the mine revert back to the community? And what is
owed to families who owned and lived on the land before Peabody
began mining there? Bessler says the tribal governments are
currently reviewing the issue of “lease holds,” without much
public scrutiny or input.
Regardless of the outcome, Clark says, the push
by young tribal leaders for more transparency and community
involvement in tribal politics is “unprecedented” and will have
“Think of Navajo government as a young
government, a few decades old. What we’re seeing now is the
struggle for local control over central control, struggle between
democracy and corporate control,” Clark said. “It’s potentially a
whole new ballgame when it comes to energy in the future. If we’re
successful, the future will look like people living in and around
renewable [energy] development that doesn’t cause asthma...and
cancer, where people have a good share of profits, better jobs and
hope for the future.”
The Navajo Nation has taken a step in this
direction. Last July, it became the first tribe in the nation to
pass green jobs legislation. The Navajo Green Economy Act
establishes a commission and fund to spur green jobs.
“The Navajo Nation is in the early stages of
alternative energy development and approved legislation to develop
a wind farm at Big Boquillas Ranch, as well as developing other
sites at Gray Mountain, Ariz. and at Black Mesa, Ariz.,” said
Arthur, in a statement.
Frazier knows change can happen, usually from
the ground up. She says tribal leaders voted to ban uranium mining
on the reservation after an uproar from community members about
illness and contamination of the land and water.
Frazier’s group, Dine CARE, has traveled the
reservation, sharing its vision of solar and wind projects. As
with the uranium mining, Frazier says, people can push their
tribal government to embrace a new way of thinking.
“There are a lot of possibilities but this is
something new,” she said. “People are afraid to talk about it
because it’s too new to them.”
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