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Coal railroad's delay reflects hurdles for exports

Published on NewsOK Modified: July 18, 2014 at 5:50 pm •  Published: July 18, 2014
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Elected officials in Washington and Oregon and environmentalists have opposed proposals to sharply expand that capacity, and several projects have been scrapped or stalled. That has direct bearing on mines and related projects in the Powder River Basin, including southeastern Montana's Tongue River Railroad.

Concerns have previously been raised about the railroad's potential negative impacts on farmers and ranchers and American Indian cultural sites in the area.

BNSF spokesman Matt Jones said the railroad's sponsors still were targeting completion of the line by the time Arch's mine is ready to ship coal.

But the timing of that, too, is uncertain.

Otter Creek, located near Ashland, Montana, is the site of a 1.4 billion ton reserve. Company executives once predicted Otter Creek could open next year.

It's now more than two years behind its original permitting schedule and is likely years away from opening given the time needed to develop the mine's infrastructure.

Just a few years ago, the industry's export aspirations appeared to be coming to fruition, with record volumes being shipped out of U.S. ports. Growth has since stalled, and projections from the U.S. Department of Energy and others show modest or even negative coal exports growth over the next decade.

Railroad opponents assert that long-term trends are stacked against coal and the Tongue River Railroad, as the U.S. and other governments take steps to reduce pollution from power plants that use the fuel.

"I'm no expert, but it seems like there's not going to be a whole lot of money to be made in coal. Maybe the big investors are realizing it's not a good idea," said Mark Fix, a rancher along the Tongue River whose land would be bisected by one of the railroad route alternatives that is under consideration by the federal transportation board.