Sen. Cantwell accuses Trump administration of unlawful action on coal-gas rule

The state U.S. senator says in a letter to the Interior Department that the new administration unlawfully put on hold the Obama-era rule that regulates oil, gas and coal valuations on federal lands

By:  Hal Bernton
Source: The Seattle Times

U.S. Sen. Maria Cantwell, in a letter sent Tuesday to Interior Department Secretary Ryan Zinke, accused the Trump administration of unlawfully putting on hold an Obama-era rule regulating oil, gas and coal valuations on federal lands.

Cantwell asserted that the Interior Department lacked the authority for the Feb. 22 suspension of the rule. She requested that Zinke, who was sworn in March 1, lift the stay on the rule.

The Interior Department didn’t respond to a request for comment about the letter.

The rule was five years in the making and took effect Jan. 1, a few weeks before President Barack Obama left office.

Sometimes, market values used to assess royalty payments have been determined by the sale prices between two related companies. The new rule would change the valuation process, in part by having the market value be based on sale prices between two companies with no financial relationship to one another.

In comments in June, then-Interior Secretary Sally Jewell said the rule would help ensure that the government obtains all revenue due to taxpayers.

But the rule has been strongly opposed by coal and petroleum-industry officials.

They say it uses flawed methodology to determine royalty payments, and have challenged it in federal court.

The rule would give the Interior Department “extraordinarily broad, even unbridled, discretion to impose a different royalty value many years after a royalty was reported and paid,” says a written statement by Cloud Peak Energy, a major coal company.