Beaver Mining is a mid-sized coal-mining company with 20 mines tocated in western Canada. The company operates deep mines as well as strip mines. Most of the coal mined is sold under contract, with excess production sold on the spot market. The coal-mining industry, especially high-sulphur coal operations such as Beaver, has been hard hit by environmental regulations. Recently, however, a combination of increased demand for coal and new pollution reduction technologies has led to an improved market demand for high-sulphur coal. Beaver has just been approached by the Mid-Western Electric Company with a request to supply coal for its electric generators for the next four years. Beaver Mining does not have enough excess capacity at its existing mines to guarantee the contract. The company is considering opening a strip mine in British Columbia on 2,000 hectares of land purchased 10 years ago for $5 million. Based on a recent appraisal, the company feels it could receive $5.5 million on an after-tax basis if it sold the land today. Strip mining is a process where the layers of topsoil above a coal vein are taken away and the exposed coal is removed. Some time ago, the company would simply remove