BHP Minerals and Southern Electric International proposed to construct a 1,700 MW coal-fired generating station located in San Juan County, New Mexico on Navajo Nation lands, south of the existing Navajo Mine. The project also required a 13,000-acre surface coal mine, a water supply pipeline, and two 500kV transmission lines. Two transmission line scenarios were evaluated – (1) construction of 475 miles of new transmission lines, and (2) utilization of the proposed Navajo Transmission Project.

EPG staff conducted environmental feasibility studies to determine the critical resource issues and regulatory requirements for construction of the Navajo South project. The studies included cultural resources, threatened and endangered species, water resources, air quality, visibility, and related resources. Schedules, processing plans, and cost estimates for the permitting process were developed to include coordination with the Navajo Nation, EPA, Department of Interior (Bureau of Land Management and Bureau of Indian Affairs), Office of Surface Mining, Western Area Power Administration, U.S. Fish & Wildlife Service, and other agencies in support of the project. A plan was developed to integrate the preparation of the environmental impact statement with the Permit Application Package, Prevention of Significant Deterioration (Air Quality) application, and Clean Water Act (Sections 401/402/404) permitting activities in compliance with applicable federal and state laws, regulations, and guidelines.