WASHINGTON: The ailing US coal industry is ramping up its political and legal offensive to win approval for West Coast export terminals that could provide a lifeline to lucrative Asia markets. Coal producers filed two recent lawsuits against governments in Washington state and California challenging local decisions to block port projects on environmental grounds. The industry is also lobbying the Trump administration to override the local bans.
The fight reflects the sector’s desperation to boost exports as US utilities continue their shift away from coal-fired power — despite Trump policies aimed at helping miners.
The proposed port projects are crucial to industry growth, said Hal Quinn, president of the National Mining Association. “It’s worth fighting these battles,” he said.
The strategy could be a long-shot.
Courts have tended in the past to side with local authorities in similar cases, and the administration’s policy options for forcing coal infrastructure on unwilling local governments remain unclear.
Officials at the White House and Department of Energy did not respond to requests for comment.
The coal industry has eyed the West Coast as a gateway to the global market for years, with plans for as many as seven terminals on the books a decade ago.
But five of those projects were canceled amid volatile Asian demand and bitter opposition in left-leaning California, Washington, and Oregon.
Coal producers are fighting for the remaining two proposed projects — in Oakland, California and Longview, Washington — and have filed two recent lawsuits, including one this month, amid rising coal demand in Japan, China and Korea.
“There are 45 new coal plants planned or under construction in Japan alone,” said Rick Curtsinger, a spokesman for Colorado-based Cloud Peak, which mines in Montana and Wyoming.
Earlier this month, the company announced a deal to export coal from a Montana mine to two new coal gasification power plants in Fukushima, Japan, site of the 2011 nuclear accident.
But growth from such deals is constrained because the only West Coast coal export facility in North America — in British Columbia, Canada — is near full capacity.
Coal buyers in Japan and South Korea confirmed they would welcome more US shipments.
Japan’s JERA utility sees the US as a key to diversifying its fuel sources, said spokesman Tsuyoshi Shiraishi.
An official with a South Korean power utility, who spoke on condition of anonymity, said: “The popularity of US coal is rising among utilities in South Korea” because of relatively low prices.
Even with the bottlenecks, coal exports rose more than 60 per cent in the first five months of 2017, driven by temporary supply disruptions from Australia and depressed prices for US coal.
Shipments to Europe rose about a third, to 16 million tons, compared to the same period in 2016, according to US Department of Energy data. Exports to Asia doubled, to 12.3 million tons, over the same period.
In Oakland, attorneys for coal export terminal developer Phil Tagami and Utah coal producer Bowie Resources kicked off hearings in court over their proposed project.— Reuters
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