The 11,025-acre Gibbons Creek coal mine in Grimes County is well on its way to having a new owner — Houston-based 3S Real Estate Investments.
But for a few more months while the contract is negotiated, the property belongs to the Texas Municipal Power Agency, which was formed in the 1970s by the four member-cities of Bryan, Denton, Garland and Greenville.
The pending $75 million sale comes on the heels of TMPA selling the Gibbons Creek coal plant to Kentucky-based environmental remediation company Charah Solutions in February.
“I think we’re all very happy,” TMPA General Manager Bob Kahn said Thursday.
A resolution approved by the TMPA board of directors gives Kahn the authority to negotiate the contract and finalize the sale of the land with 3S Real Estate. Kahn said it will take a few months before that work is complete.
Even once the mine is sold, TMPA will still exist, but it will be a solely transmission-owning company, Bryan Texas Utilities General Manager Gary Miller explained in an interview at the end of June. He said TMPA would continue to own its large substation at the Gibbons Creek power plant site and the connecting transmission lines, which leave that substation and go into Bryan-College Station and then up to North Texas where the other three TMPA member cities are.
TMPA will still be responsible for completing the remediation efforts on the mine even after the contract is signed, Kahn said.
The lignite mine was operational from 1982 until 1996 when TMPA shut it down and began importing coal from Wyoming, according to the TMPA website. Lignite is a low-grade form of coal. Since closing, the mine has been in reclamation. The reclamation operations are more than 90% complete, and Kahn said they should be done in a year or two.
At the time of an interview earlier this month, Bryan City Manager and TMPA board member Kean Register said there were 10 fast-close cash offers at $60 million or more for the mining land. The TMPA agenda from Thursday’s meeting says that there were “numerous proposals” for the mine, and that the five highest bidders were considered by the board of directors. The $75 million offer from 3S Real Estate was the “highest and best bid,” according to the agenda.
The TMPA board of directors, Kahn said, will probably decide what to do with the funds that come from the sale at a September meeting. He said it is likely that it will be divided up based on how much each member city owns. In that case, Bryan would receive 22% of the $75 million since the city owns that much in land.
Kahn said he is not sure how 3S Real Estate plans to use the mine land.
The resolution that was approved Thursday says that the sale of the land will include all of the mineral estate, the wells and water rights.
Register said in an interview earlier this month that when leaders were discussing selling the mine land he ran a couple of ideas past other TMPA board members, including a proposal to hold onto the land until the value increased so it could be sold for a greater profit in the years to come. He also asked if the city of Bryan could receive its share of proceeds from the sale in land rather than in money. Both suggestions were turned down.