Coal's long shadow 

The Crow Reservation is banking on a massive development deal with Cloud Peak Energy. The implications stretch far beyond southeast Montana.

Crow Tribal Chairman Darrin Old Coyote rides proudly along Crow Agency's main drag on a Thursday morning in mid-May, wearing an ornate headdress and riding a horse named Skip. Behind Old Coyote stretches a long procession of tribal officials, parade floats and 20-year-old Crow member Amanda Not Afraid, recently crowned Miss Indian Rodeo 2014 at a ceremony in Las Vegas. Hundreds of people line the streets. A vendor on the curb is selling decorative beach towels. Another offers biscuits and gravy for $3 off a grill in the bed of a pickup.

Old Coyote became the 21st chair of his tribe in late 2012, when his people elected him by a wide margin over incumbent Cedric Black Eagle. Today's parade honors the tribe's Head Start students, and each class sits atop its own float. Other flatbeds are dedicated to various tribal offices and organizations, from the Apsaalooke Housing Authority to the Apsaalooke Nights Casino. Near the end of the parade route, Old Coyote stops on the side of the road, waving to the procession until the last float rolls slowly by.

The Crow Indian Reservation in south-central Montana is the state's largest, encompassing roughly 2.2 million acres—nearly half of it individually allotted trust land. Flanked on the west by the Pryor Mountains and the east by the Little Bighorn Battlefield, much of Crow is dedicated to livestock grazing and cropland. But the area is rich in natural resources, too. The Powder River Basin, a geological bonanza of coal deposits, stretches north from Wyoming over the reservation boundary. An estimated 9 billion tons of coal lie beneath Crow alone, and since the Colorado-based Westmoreland Mining Company first came to the reservation to open its Absaloka Mine in the 1970s, the tribenow numbered at more than 13,600 membershas relied almost solely on the coal industry as its economic backbone. Revenues from coal development account for nearly half of the Crow Tribe's annual budget.

After the parade, Old Coyote leans against his horse trailer. He's untucked his green ceremonial shirt from his jeans and replaced the headdress with a cowboy hat. His spurs—the same pair, adorned with the American flag, that he wore while riding behind President Barack Obama on horseback on the reservation in 2008jingle as he crosses his legs. Coal might be a "bad four-letter word" to many, he says. But for a people suffering from a staggering 47 percent unemployment rate—a people now 40 years dependent on a product scientists, environmentalists and political officials around the globe are blaming for climate change—there aren't many alternatives.

"Unless these NGOs can tell me how else to feed my people," Old Coyote says, "we're going to pursue development."

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In January 2013, Old Coyote signed an agreement with mining company Cloud Peak Energy to lease 1.4 billion tons of coal in the reservation's southeast corner. Negotiations started in earnest years earlier, and former Chairman Black Eagle—who had also attempted to focus on advancing the now-botched $7 million Many Stars coal-to-liquids plant—helped advance the deal prior to being voted out of office. Cloud Peak paid the tribe $2.25 million at the onset of the agreement. Approval by the Bureau of Indian Affairs last June won the Crow an additional $1.5 million. Since 2012, Cloud Peak has awarded more than $65,000 in scholarships to Crow students. The company has also promised preferential hiring of tribal members when mining commences. The exploratory phase of Cloud Peak's agreement is estimated to last five years.

Cloud Peak is something of an anomaly among coal companies in the Powder River Basin. For a company incorporated just five years ago, it has made significant progress not only in securing vast coal reserves but in greasing the political wheels in the West. And by Old Coyote's thinking, Cloud Peak could bring new opportunities for his people. He's already seen the impacts in his own family.

"My daughter, she's applied for one of the grants," he says, referring to the company's tribal scholarship program. "She's currently going to school in MSU Bozeman, and she's a recipient of the Cloud Peak scholarship."

A bigger picture

The Crow aren't alone in seeing the promise of what Cloud Peak has dubbed the Big Metal project—named for a character from Crow creation stories. Cloud Peak, which derives its own name from the peak in the Bighorn Mountains where Crow ancestors first settled, currently trails behind regional heavyweights like Peabody Energy, Alpha Natural Resources and Arch Coal with a mere 1.3 billion tons in coal reserves. But the 1.4-billion-ton deal with the Crow tribe will more than double the company's coal reserves in the region, solidifying it as the third largest reserve holder in the entire Powder River Basin.

"We continue to see projections for a very robust demand internationally for coal, and a very stable demand for coal from the Powder River Basin," says Rick Curtsinger, Cloud Peak's media relations manager. "We believe that we are very well positioned moving forward to help meet that demand for low-cost, affordable electricity."

While Cloud Peak may be a relatively new name, the company can trace its roots back more than a century through its former parent company, multinational British-Australian metals firm Rio Tinto. Rio Tinto was founded in 1873 when investors purchased a mine complex along the Rio Tinto River in Spain. Over more than a century, the company's interests expanded globally to include iron ore, uranium, copper, diamonds and coal. And as it expanded, the company increasingly garnered the attention of environmentalists across the globe.

Rio Tinto arrived at the Crow Reservation as one of the largest mining companies in the world, and the second largest producer of coal in the U.S. In 2008, it announced plans to sell off its Wyoming-based American offshoot, along with heavy stakes in mines throughout the Powder River Basin. Cloud Peak Energy was born, and in November 2009, common stock in Cloud Peak was offered to the public at $15 per share. Executives who had overseen the offshoot during its Rio Tinto days transitioned to the new company.

click to enlarge Crow Tribal Chairman Darrin Old Coyote is a strong proponent of coal development on his reservation. - PHOTO BY CATHRINE L. WALTERS
  • photo by Cathrine L. Walters
  • Crow Tribal Chairman Darrin Old Coyote is a strong proponent of coal development on his reservation.

Cloud Peak's stock soared 40 percent in its first year. By summer 2011, the company had won a bid on additional coal tracts at the Antelope Mine in northern Wyoming for roughly $297.7 million. The bid more than doubled Cloud Peak's holdings at the Antelope Mine and helped beef up the company's portfolio, which also included Rio Tinto's old Spring Creek Mine, an expansive open-pit operation just over the Montana border near Decker. Cloud Peak signed a 10-year deal that June to ship coal from its Antelope, Spring Creek and Cordero Rojo mines through Vancouver's Westshore Terminal to markets in Asia.

But Cloud Peak's agreement with the Crow came as a surprise to some. Mike Scott, regional representative for the Sierra Club in Billings, notes that other companies in the past six years have experienced serious difficulty in expanding their operations in the Powder River Basin. Cloud Peak's play seemed bold when he first heard about it in 2011.

"When Otter Creek got leased in 2010, there was this flood of new proposals for mines that came right after," he says. "Most of those projects just collapsed, to the point where Otter Creek is really the only one that's still floating around out there. To see Cloud Peak decide to come and try to make that play when all these other companies sort of failed did surprise me."

Cloud Peak's plans for the future—and the coal it hopes to develop through the Big Metal project—hinge heavily on the completion of two proposed export terminals on the West Coast: The Gateway Pacific Terminal in Cherry Point, Wash., and the Millennium Export Terminal in Longview, Wash. Those port projects are pivotal to Cloud Peak increasing its coal supply to markets in Asia, Curtsinger says. "Our CEO and President Colin Marshall has said that the ports developing terminal capacity certainly makes the production of the Crow tribal coal much more likely," he explains, "as it's incredibly important to have that capacity to meet that demand."

That reliance has dragged Cloud Peak into the center of a much more contentious regional debate. The coal industry is increasingly at odds with critics fearful of impacts to small communities stemming from increased exports to Asia. Cloud Peak managed to secure a third of the annual throughput at the Gateway Pacific terminal. The company doesn't expect to begin actually developing its coal reserves on Crow for four or five years, a timeline that coincides with Gateway Pacific's desired start date. When the terminal opens in 2018, Cloud Peak expects to ship more than 15 million tons of coal a year there—a volume of production and export that could result in a massive bump in coal train traffic through Montana, Idaho and Washington.

The Lummi Nation on the Washington coast has been a staunch opponent of Gateway Pacific's development in recent years, with the tribe citing "dramatic and long-lasting impacts on not only the fisheries but the Lummi fishing fleet." Cultural concerns for the Lummi range from historic shellfish harvesting tracts to the presence of a 3,500-year-old village site near the proposed export terminal. Last July, after months of protest, Lummi tribal leaders officially stated their opposition to the terminal in a letter to the U.S. Army Corps of Engineers.

"If the projects at Cherry Point are constructed and operated there will be impacts on the Lummi treaty rights forever," Tim Ballew II, chair of the Lummi Indian Business Council, wrote in the July 2013 letter. "It is imperative that the Corps carry out its trust responsibilities as they relate to the Lummi Nation and the treaty rights to fish, gather and hunt in the usual and accustomed places."

click to enlarge Critics have become increasingly vocal about the effects more coal development in Montana and Wyoming could have on train traffic through cities like Missoula and Spokane. - PHOTO BY CATHRINE L. WALTERS
  • photo by Cathrine L. Walters
  • Critics have become increasingly vocal about the effects more coal development in Montana and Wyoming could have on train traffic through cities like Missoula and Spokane.

The Lummi aren't alone. Last month, two Missoula-based coal protest groups—the Blue Skies Campaign and 350-Missoulamet alongside the railroad tracks bisecting Greenough Drive to draw attention to both local impacts and the contribution coal burning has made to climate change. Missoula lies along the path to those West Coast terminals, a fact that has twice prompted the Missoula City Council to request that the Army Corps expand the scope of environmental reviews for West Coast coal terminals to include impacts of increased coal train traffic on the community. The second of those resolutions—a measure passed last fall pertaining specifically to the Millennium terminal—drew criticism from both the pro-mining group Count on Coal Montana and the Crow government. Old Coyote, concerned with the resolution's potential effect on Cloud Peak's plans, went so far as to write a letter to the council.

"For our plans to create jobs and bring new investment to succeed, we must do all we can to see that the construction of new coal export facilities is not impeded unreasonably," Old Coyote wrote last October. "I would respectfully request that you at least remain neutral on this issue and not encourage an [Environmental Impact Statement] process that would obstruct important economic opportunities for the Crow Tribe and the state of Montana."

The Otter Creek parallel

Vocal opposition to Cloud Peak's Big Metal project doesn't appear to have taken root on the Crow reservation. The loudest critics of the company's plans reside hundreds of miles away, while on Crow the most common talking points come from Old Coyote and other politicians in the form of jobs, economic stimulus and the bonus of educational opportunities for students. The Sierra Club's Mike Scott says he's heard from a few tribal members who have their doubts. Mostly he feels the mine, still in its earliest exploratory stages, isn't enough of a reality for people to risk the backlash for speaking out.

"Over the last 30 years, companies have bored holes all over for projects that fell apart," Scott says. "People have a lot to worry about. They might not waste time on this until they know it's going somewhere."

That relative silence seems odd when compared to another proposed mining project in southeastern Montana. Arch Coal's push to strip mine the 18,000-acre Otter Creek site has resulted in legal challenges, rallies and even protester arrests over the past four years. Politicians have rushed to support the proposal, with former Gov. Brian Schweitzer famously touting the economic benefits of development at Otter Creek as "the biggest, fastest horse in the state." Arch Coal intends to access an estimated 1.4 billion tons of coal on state land—the amount Cloud Peak has secured in its agreement with the Crow tribe.

The concerns voiced by ranchers over the Otter Creek proposal differ radically from those raised by coal critics in Missoula and beyond. Arch Coal owns a third of the stake in the Millennium terminal, with eyes on Asian coal markets, and the plan for Otter Creek includes development of and shipping along the proposed Tongue River Railroad. Among the Northern Plains Resource Council's long list of criticisms over the rail line is the position that it will "make ranching and farming more difficult and expensive, will split ranchland in half separating fields from the [Tongue] river, and will shift the liability of train crossings to the landowner." Numerous ranchers have echoed those fears since 2011.

"I think the reality is that while people do want economic development, they've all seen boom and bust happen already," Scott says. "They get this, they know what it is. They know that very few people get rich and everybody else gets stuck with the bill, and they don't think it's worth it."

Proximity to North Dakota's Bakken oil boom certainly hasn't helped. Everyone knows someone who worked in the patch for a few weeks, Scott says, only to quit when the truth about crime, pollution and inadequate infrastructure became evident. "They don't want their communities to become Williston," he adds.

click to enlarge Northern Cheyenne member Phillip Whiteman Jr., right, and his wife Lynette Two Bulls teach people both on and off the Northern Cheyenne Reservation a more spiritual, solution-based approach to life and activism. Whiteman believes a focus on the problem merely escalates it. - PHOTO BY CATHRINE L. WALTERS
  • photo by Cathrine L. Walters
  • Northern Cheyenne member Phillip Whiteman Jr., right, and his wife Lynette Two Bulls teach people both on and off the Northern Cheyenne Reservation a more spiritual, solution-based approach to life and activism. Whiteman believes a focus on the problem merely escalates it.

Cloud Peak has perhaps sidestepped similar backlash thanks to its apparent political acumen. The company established a strong base early on with formation of a political action committee in 2010, and campaign contributions trickled out from Cloud Peak to political candidates in Colorado, Wyoming and Montana. Cloud Peak began lobbying Congress as well, spending hundreds of thousands of dollars on issues ranging from Environmental Protection Agency regulation of greenhouse gases to the National Environmental Protection Act process for proposed export terminals. The company has relied on a list of revolving door lobbyists with strong ties in the West; from 2011 to 2013, that list included former Montana Republican Party Executive Director Mark Baker, who also worked as a legislative director for Sen. Conrad Burns and as chief of staff to Rep. Rick Hill.

According to data from the Sunlight Foundation, the company donated $16,000 to former Rep. Denny Rehberg between 2010 and 2012, including $10,000 to support his bid for U.S. Senate against Democratic incumbent Jon Tester. Tester and recently retired Sen. Max Baucus have also received campaign contributions from Cloud Peak in the past$2,000 and $5,000 total, respectively—but not nearly in the amounts that have poured into Republican coffers.

In the 2014 election cycle, Republican Rep. Daines has replaced Rehberg as the biggest recepient of Cloud Peak money. Cloud Peak contributed $10,000 to Daines' U.S. Senate race in the past year alone—the most to any single candidate nationwide. The donations come on the heels of heavy support for Daines' initial congressional bid. Daines has come out as a strong backer of coal development in the statethough when asked about the donations, his office maintained that Daines has "always been a strong supporter of responsibly developing Montana's energy resources." He trumpeted the signing of Cloud Peak's agreement with the Crow Tribe last year, offering his full support for the project months in advance of the BIA's approval.

"Just this week I met with Chief Old Coyote in Washington, D.C.," Daines wrote in a Jan. 24, 2013, statement. "I am eager to continue a strong relationship with our tribal leaders to help create more jobs in Montana's tribal communities. This agreement marks an ideal beginning to that effort."

Tester extended similar support for the project at the time, with the provision that "implemented properly," the tribe's partnership with Cloud Peak stands to improve the quality of life for its members. Tester announced this spring that he, along with Sen. John Walsh, would push for reauthorization of the Indian Coal Production Tax Credit, a $2.50-per-ton tax break that could stand to benefit Cloud Peak for its future development on Crow. By comparison, Cloud Peak is offering the tribe $0.08 to $0.15 per ton, with an additional 21- to 30-percent payment from coal sales for royalties and production taxes.

Tester has, in fact, spoken directly with Cloud Peak on several occasions. His schedules for Feb. 7 and June 12, 2013, both listed meetings with company representatives. Tester's communications director, Marnee Banks, says those conversations centered on the company's work in Montana, with Cloud Peak reassuring the senator that "mining on tribal land will create jobs and boost tax revenue." Despite those meetings and Cloud Peak's years-long lobbying record on tax issues, Banks says Tester decided to support the tax credit measure only after discussions with Crow leaders like Old Coyote. "The decision," she adds, "was not made at the behest of the coal lobby."

Daines' office says the congressman also intends to introduce a tax credit reauthorization measure in the U.S. House, one that would make the break permanent.

A different brand of activism

A wall of dark blue storm clouds rolls across the sky above Lame Deer on the Northern Cheyenne Reservation, which lies just east of Crow and several miles north of the mine-dominated landscape around Decker. Northern Cheyenne tribal member Phillip Whiteman Jr. hurries to unsaddle his horses as bolts of lightning crisscross the sky. He's spent much of the late afternoon repairing a mechanical bucking machine outside a trailer on his lower acreage. His wrinkled hands are covered in grease. Wind kicks dust in his eyes as he hauls tack to a shed.

Whiteman wouldn't call himself a coal critic. He wouldn't say he's anti-coal, nor would he choose to call opposition to development a "war" as individuals like Daines have. The founder of Yellow Bird Inc., a grassroots organization focused on environmental protection and spiritual identity, Whiteman approaches the issue far differently than high-profile groups like the Sierra Club, the Blue Skies Campaign or Greenpeace. Sitting at his dining room table up the road from his corral, he runs through a series of hand exercises designed to highlight just how left-brained many people are. Lacing your fingers together in a certain way may feel wrong or uncomfortable. Those words don't sit well with Whiteman. They insinuate a focus on the negative, not the positive.

"You can have the best of intentions, but you're still part of the problem," Whiteman says. "You have to know what you're for, not against. If you're against fossil fuels and industrial culture, you're escalating it and you're elevating it. You're focusing on the problem, not the solution."

Whiteman won't directly criticize coal companies or their activity. It's an oddly calm mentality considering his reservation, while free of coal activity itself, is bordered to the north by the Colstrip coal-fired power plant and to the west and south by mines like Spring Creek and Decker. If development at Otter Creek commences, Northern Cheyenne will be surrounded on all sides. Yet when asked if he feels pained or frustrated or concerned driving past these areas, Whiteman rejects the emotions.

"It don't concern me because I believe in a power greater than myself," he says. "I believe in universal law, natural justice, and I believe in a self-correcting earth. It's those that are doing this act, they're the ones that should be concerned because everything comes back around. What you put out there comes back."

Coal is rich below Northern Cheyenne, too, and poverty is pervasive. The tribe has flirted with the idea of pursuing development for years; in 2006, reservation voters overwhelmingly supported a referendum calling for the mining of coal. Past tribal officials have even campaigned on the promise of jobs and economic stimulus. Yet the Northern Cheyenne haven't issued a single permit, and many on the reservation have staunchly opposed the proposal at Otter Creek. Whiteman credits the lack of development here to a strong grassroots pushback, and to the fact that his people maintain powerful ties to their past.

"It goes back to language, culture and identity, our connection to air, land and water," he says, adding that those who did take a run at development are "no longer with us. They're no longer in office."

Whiteman and his wife, Lynette Two Bulls, an enrolled member of South Dakota's Oglala Lakota Nation, espouse a holistic belief system that builds on that connection to the land. It translates into everything Yellow Bird Inc. does. For tribal members, the company builds that connection through the annual 400-mile Fort Robinson Outbreak Spiritual Run between Crawford, Neb., and Busby, an event that commemorates the trek Northern Cheyenne took to return home in 1879 after a bloody breakout from Fort Robinson. For visitors, Yellow Bird Inc. teaches how to approach critical issues from a positive, solution-based mindset. Whiteman and Two Bulls recently hosted a crew from Greenpeace interested in incorporating those lessons into their organization's activism.

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To understand what coal development means for the environment, Whiteman believes people need to take a hard look at the history of indigenous tribes in the United States. American Indians never displayed a sense of ownership over the land, he says. How can you own something that owns you? Western industrial culture is "warped thinking," and has in many ways backed large parts of Indian Country into situations of poverty and joblessness. For centuries tribes have been traumatized, oppressed, abused. Now that abuse is being enacted in new ways with broader implications.

"That land gave birth to us," he says. "We have astrology stories dating back to the beginning of time that we come from the stars. With that kind of imprint and that kind of history, we predate manifest destiny. We predate eminent domain. We predate that, and what happened to our people is a crime. Now it has moved on into Mother Earth."

The war on coal

Darrin Old Coyote isn't just banking his tribe's future on one mine or one resource alone. This spring, the Crow Tribe received a $665,000 grant from the U.S. Department of the Interior to help fund a $44.5 million hydroelectric dam. The Yellowtail Afterbay Hydropower Project on the Bighorn River could generate up to 12 megawatts of power, and is expected to begin operating by 2018.

Old Coyote points to the Yellowtail Afterbay project as further evidence that the tribe is trying to "diversify our revenue stream." Coal isn't the only gift on the reservation. Still, Old Coyote believes Cloud Peak's deal will ultimately offer more jobs and more revenue for the Crow than renewable industries like hydro or wind energy could.

Scott, with the Sierra Club, isn't so sure. Cloud Peak doubling its reserves with a 1.4-billion-ton deal may look good to investors on paper, and a few million dollars up front—along with thousands in scholarship funding—may have some tangible impact on Crow initially. But the voices of coal critics are getting louder. The industry's domestic market is shrinking. And opposition to the new infrastructure necessary to ramp up exports is strong.

"As people have understood more what the impacts of strip mining are, I don't think you have as much sympathy out there for coal as you used to," Scott says. "I think the other thing is the decline in the use of coal. A few years ago, coal was almost 50 percent of the nation's energy. It dropped to 37 percent pretty abruptly. People who pay attention to this saw the 10-percent reduction over just a couple of years and the lights didn't go off. Hospitals didn't stop working. The catastrophe the coal industry has promised us if we stop using coal never materialized."

Old Coyote is insistent that Cloud Peak could provide a quicker fix for his people than other alternatives. He frequently turns to a creation story when defending his tribe's need to take Cloud Peak up on its promises. The Creator blessed the Crow Tribe with resource-rich land for a reason, he says. It was a gift, one he intends to use to improve his people's lot.

Old Coyote views opposition to increased train traffic and West Coast terminal development as part of a broader war on coal. He's not the only one using the motif; in a press release earlier this month, Daines decried Gov. Jay Inslee's announcement against reliance on coal in Washington as a "new front in the War on Coal." His office elaborated on the issue, saying that reductions in demand for power from Colstrip would "directly affect the amount of coal it would be able to obtain from Montana reserves, like those found on the Crow reservation."

"A war on coal," Old Coyote says, "is a war on Crow families."

"We as Crows have been through many types of wars," he adds, "from assimilation to small pox to inter-tribal warfare. We survived. We endured through many hardships. But there are always better days ahead of us. We will continue fighting."

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