The Obama Administration is set to announce a moratorium on new coal leases on federal lands while it reviews whether or not royalty rates paid by producers deliver a fair return to taxpayers. Via the Associated Press, it is unclear how significant the impact on coal companies will be given declining coal demand and the recent spate of coal-fired power plant retirements amid stricter emissions rules.
President Obama said in his State of the Union address on Tuesday he would push to change the way federal oil and coal resources are managed. Producers currently pay a 12.5% royalty rate to drill and mine on federal lands.
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