SHERIDAN — After officials from the Navajo Nation announced the tribe would not financially back bonds the Navajo Transitional Energy Company needs to operate three recently-acquired mines earlier this week, NTEC officials said the decision will not interfere with the company’s ability to operate the mines going forward.
In a conference call with media Wednesday afternoon, NTEC Governmental and External Affairs Director Steve Grey said the company had prepared for the possibility of the Navajo Nation not supporting bonding for the mines and is capable of proceeding on its own.
Grey estimated NTEC would need to secure $400 million in bonds for the company’s recently-acquired mines.
“At this point in time we’re very confident (we’ll be able to secure those bonds),” Grey said. “When NTEC was first doing the acquisition, the financial people that know about NTEC, that have worked with us very closely…were very confident that NTEC had both the knowledge as well as the expertise as well as the financial security to operate the new mines.”
NTEC’s flagship mine, the Navajo Mine in New Mexico, is still generating strong revenues for the company and those revenues will give NTEC the financial capital necessary to self-finance the bonds, Grey said.
“Just from that asset alone, we are very well situated,” Grey said.
NTEC took control of the Antelope and Cordero Rojo mines in Wyoming and the Spring Creek Mine in Montana late last month after acquiring the three mines from the bankrupt Cloud Peak Energy for $15.7 million.
That acquisition caused friction between NTEC and the Navajo Nation — which owns but does not control the energy company — as tribal officials said they were not made aware of plans to purchase the mines.
Grey said NTEC was barred from discussing the deal with the Navajo Nation due to nondisclosure agreements tied to negotiations over the mine. Further, Grey said that because the Navajo Nation does not exercise control over NTEC, the company was not required to keep the tribe updated on its negotiations for the mines.
Spring Creek Mine closed suddenly after NTEC took control last month resulting from complications in the company’s negotiations with the Montana Department of Environmental Quality over a permit for the mine.
The shutdown only lasted two days, as NTEC and the Montana DEQ reached a short-term agreement that would let the mine continue operating for 75 days while permit negotiations continue.
On Wednesday, Grey said NTEC was still on track to reach an agreement with the Montana DEQ before that 75-day window closes.