Asia coal export boom brings no bonus for U.S. taxpayersThe big coal companies simply created a bunch of shell companies to "sell" their coal to before exporting it. They claim they did nothing wrong.
WASHINGTON (Reuters) - U.S. miners who are booking big profits on coal sales to Asia are enjoying an accounting windfall to boot.
By valuing coal at low domestic prices rather than the much higher price fetched overseas, coal producers can dodge the larger royalty payout when mining federal land.
The practice stands to pad the bottom line for the mining sector if Asian exports surge in coming years as the industry hopes, a Reuters investigation has found.
But Asian economies rely on coal to sustain growth, so the ton worth about $13 near the Powder River Basin mines last year fetched roughly 10 times that in China.
Extended to the last few years of increased Asian demand, that total could exceed $100 million in forgone royalties. The sum could balloon into billions of dollars if mining giants are allowed to ship 150 million tons of coal a year or more through the Pacific Northwest, as the industry wants.The piece goes on to explain that the courts have already ruled against a similar practice in a case from the 1970s.
In the late 1970s, Marathon Petroleum Corp used a similar accounting system to settle royalties on natural gas that was produced in Alaska but sold to Japan.Big Coal has its hands in the federal cookie jar at a time when the politicians are looking everywhere for cuts including some areas of the budget that should be out of the question.
A federal court eventually told Marathon to pay out royalties based on the overseas value. Officials leveled a $10 million fine against Marathon.
(Reporting by Patrick Rucker; editing by Jonathan Leff and Prudence Crowther)
Yesterday also saw two hearings on Big Coal's plans to ship vast quantities of Powder River Basin coal through the Pacific Northwest by train and then onto a flotilla of bulk carrier ships bound for Asia. The biggest one was in Spokane.
NW coal port hearing draws 800 at fairgroundsHundreds Attend Coal Train Hearing In Spokane
By Patrick Rucker
Eight hundred people poured into Spokane County Fair and Expo Center on Tuesday afternoon to debate a proposed coal port facility in northwest Washington.
Proponents stressed jobs; environmentalists talked about risks, including global warming from expanding coal consumption in Asia.
People lined up early to secure a limited number of speaking spots handed out to those first in line.
A trade organization promoting coal shipments hired about 30 temporary workers to stand in line from 8 a.m. until 3:45 p.m. to get speaking spots for their representatives.
Environmentalists arrived early as well to ensure that people traveling from communities near the coal fields of Montana and Wyoming would get a chance to speak.
“My land is beautiful. The river is clean,” said Alaina Buffalo Spirit, a member of the North Cheyenne Tribe living near Colstrip, Mont. “I would like to see it stay that way.”
The next Pacific Gateway Scoping Hearing is on 12/12/12 in Vancouver Washington.
Please take the time to attend one of upcoming five Scoping Hearings if you can.
Vancouver, WA 12/12/12 – At Clark College, Graiser Student Center, 1933 Fort Vancouver Way, 98663 from 4pm-7pm
Seattle 12/13/12 – 4-7 p.m. Thursday, Washington State Convention Center, Ballroom 6F
You can also submit as many comments as you want on aspects of the project that are a concern to you HERE
There was also another hearing on one of Big Coal's tentacles planned embrace the region in Boardman Oregon, this time on a proposed coal barge port to barge coal down the Columbia River passing Portland to a terminal at Clatskanie Oregon.
Columbia River Coal Plan Gets First Hearing In Boardman
Oregon’s Department of Environmental Quality hosted the meeting to take comments and answer questions about permits required for the proposed Morrow Pacific Project. It would transport coal by train to the eastern Oregon port city. Then coal would then be barged down the Columbia River and eventually shipped to Asia.
Around 200 people came with questions for department officials.
The Department of Environmental Quality will hold two more meetings this week: One Wednesday in Clatskanie and one Thursday in Portland.CLATSKANIE: Wednesday, December 5th, 6 pm, rally at 5:30 pm: Clatskanie High School. Meet at Portland Sierra Club office at 3 pm.
PORTLAND: Thursday, December 6th, 6 pm, rally at 5 pm: Ambridge Event Center, 1333 NE MLK Blvd. NOTE: Location has changed from University of Portland. Buses leaving from Salem and Hood River.
For more information see: Beyond Coal Oregon
Finally there's some really good news to share Canadian Pacific Railroad is essentially walking away from a $180 million dollar investment in a billion dollar plan to extend their rail network by building a new 260 miles of new track to the Powder River coal mines, providing a third rail route from the PRB (Powder River Basin) to the Pacific Coast for export.
Citing coal weakness, Canadian Pacific shelves expansion into western coal country
By Adam Belz
CP said it will “defer indefinitely plans to extend its rail network” into the Powder River Basin, a swath of land between the Black Hills and the Big Horn Mountains that contains one of the largest coal deposits in the world. The railroad company — Canada’s second-largest — is also taking a loss on $180 million associated with the cost of the project, which never got off the ground.
Railroad investors have cooled to the prospect of deep investment in coal and CP is being realistic, said Dave Fellon, president of Progressive Rail, a short line owner and operator based in Lakeville.
When you do an investment like that, you’ve got to be looking out 20 years, and I don’t know that there’s the stability for that right now,” Fellon said. “They’re smart people at CP. They’ve got good intelligence on markets.”Stopping these coal export ports is a very important fight to win for the future of our planet.