Two coal companies operating in Montana's Powder River Basin are combining resources to expand coal exports through proposed new terminals in the Pacific Northwest.
Coal mine deal paves way for supplying 8 million tons to proposed Longview export terminal
BILLINGS, Mont. — Coal companies announced an agreement Thursday to consolidate ownership of a Montana mine in a deal aimed at boosting exports of the fuel to Asia through ports on the U.S. West Coast.
Under terms of the deal, Wyoming-based Cloud Peak Energy would sell its 50 percent stake in the 120-worker Decker Mine to co-owner Ambre Energy of Australia.
In turn, Ambre would assume liability for $67 million in reclamation and lease bonds for the mine. Cloud Peak also gains the option to move almost 8 million tons of coal annually through a port proposed by Ambre in Longview, Washington.
"As well as building new port infrastructure, Ambre will now also be able to guarantee the supply of high-quality U.S. coal to customers in Korea, Japan and the Asia Pacific region from its own mining operations," King said.
In 2011, Ambre bought 50 percent stakes in Decker and a second mine, Wyoming's Black Butte, which it owns with Anadarko Petroleum. But a year later, Decker laid off 59 employees — more than one-third of its workforce.
Cloud Peak Sells Stake In Export Mine
By STEPHANIE JOYCE
The Decker mine has been losing money in recent years, but Ambre Energy spokeswoman Liz Fuller says the mine has good quality coal and is well-positioned for exports through the Pacific Northwest. Exporting significant quantities of coal from the mine is dependent on approval of Ambre's proposed export terminals. One of them, in Oregon, was denied a key permit earlier this month. Cloud Peak spokesman Rick Curtsinger says there’s no contingency in the agreement for what will happen if the project in Washington isn’t permitted.
“We continue to see them as very viable projects and believe that they will move forward,” he said.
Most residents of the coastal region oppose more coal trains that the proposed export terminals would bring, along with the bulk carrier ships transiting our sensitive waterways.
Tuesday in Everett local opponents to the increase in coal and oil trains sent a message we won't take more trains laying down.
Protesters of oil and coal shipments block railroad tracks in Everett
SEATTLE — About a dozen demonstrators blocked railroad tracks Tuesday morning at a Burlington Northern Santa Fe yard in Everett to protest train shipments of oil and coal and proposed export terminals in the Northwest.
Protesters included one person sitting atop a tripod over the tracks, according to organizers with the group Rising Tide Seattle. Others are locked to the legs of the tripod.
"People in the Pacific Northwest are forming a thin green line that will keep oil, coal and gas in the ground," spokeswoman Abby Brockway said in a statement. "Just one of these proposed terminals would process enough carbon to push us past the global warming tipping point — we won't let that happen."
The demonstration started about 6 a.m. and blocked an oil train and freight trains at the yard near Interstate 5, said railroad spokesman Gus Melonas. The main line remained open at the scene, about 30 miles north of Seattle.
"All the people in the blockade have brought concerns in many other avenues," said spokeswoman Delaney Piper. "We feel we have used political venues, advocacy — all of those tools — and this is the tool most necessary right now, because the situation is so dire that direct action is necessary."
BNSF has broken a record this year for capital and safety improvements — $5 billion systemwide, which in Washington includes new track in the Everett area, Melonas said. With the attention on oil trains, the railroad has focused on crew compliance with speed requirements, advanced detection systems and enhanced inspections.
The opposition is just getting started with much more to come IMHO.
Now for the good news. While the world continues to produce a lot of coal, aggressive competition between producers have pushed prices down to very low levels. So low Cloud Peak calls them unsustainable.
Cloud Peak Cuts Forecast As Coal Prices Are 'Unsustainably Low'
Now for the GREAT news for opponents of the proposed Coal Export Terminals in the Pacific Northwest. But its not altogether good news about fossil fuels.
Rain, rail congestion cut into coal output
By John Seward
CASPER, Wyo. — Cloud Peak Energy lowered its production estimates for this year on Tuesday, citing August rains and congested rail service.
Estimates for 2015 and 2016 include projections of further declines, the Gillette-based coal company said, as operations at the Cordero Rojo mine are scaled back....
This means
the rail corridor across the northern tier between Eastern Montana and the EXISTING COAL EXPORT TERMINALS is already near capacity. The trains full of Balkan Oil have been proliferating and utilizing more of the northern tier rail corridor capacity, putting the squeeze on coal trains bound for the terminal docks along the West Coast.
Officials ask federal board to help on rail delays
Burlington Northern Santa Fe has plans to increase capacity in some sections of the route, but that would be very difficult and expensive through the more mountainous sections of the norther tier route, so they are likely to remain as bottlenecks. The 240 mile section between East Glacier Montana and Bonner's Ferry Idaho is almost all mountainous terrain. That lack of rail capacity could doom plans for one or more of the proposed coal export terminals.