Navajo Nation Council has granted approval to extend operations of the 2250MW coal-fired power plant located near Page, Arizona, US.

The council has approved the replacement lease and related agreements to operate the Navajo Generating Station (NGS) until December 2019.

Earlier this year, the NGS owners agreed to extend operations of the coal-fired facility through the end of its current lease in 2019.

They have decided to prepare required agreements to be signed with the Navajo Nation to carry out decommissioning activities after 2019.

A Navajo Nation task force and Salt River Project, on behalf of other NGS owners, had negotiated the proposed replacement lease and related agreement over a period of several months.

The 35-year replacement lease is comprised of $110m in lease payments with minimum fuel purchase revenues assurances for the Navajo Nation of $39m in 2018 and 2019, as well as use of transmission from the NGS transmission station to sites off the reservation.

As part of the replacement lease, Navajo Nation will also hold additional assets associated with NGS, including additional commercial buildings, railroad and lake pump system.

The plant operator SRP’s deputy general manager Mike Hummel said: “This agreement provides meaningful benefits for all involved and creates a path forward during this challenging transition.

“Importantly to us, the replacement lease paves the way for SRP employees at the plant to remain on the job for an additional two-plus years and allows us to fulfill our commitment to redeploying all regular NGS employees to other SRP facilities after 2019 should they so choose.”

Image: Navajo Nation Council has approved replacement lease for coal-fired power plant. Photo: courtesy of Salt River Project.