HOUSTON Feb 8 With the world coal market
roiled by supply problems, there is increasing talk of
exporting U.S. western coal into the Pacific Basin.
Union Pacific Railroad UPN.N is exploring coal export
opportunities through U.S. West Coast ports, a spokeswoman
The Port of Long Beach, California, has had discussions
about exporting coal in addition to the petroleum coke it
already handles, a spokesman said.
The biggest coal port on the west coast of North America,
Canadian coal-handling Westshore Terminals Ltd at Vancouver,
British Columbia, has had inquiries, an executive said.
The biggest U.S. coal company, Peabody Energy Corp (BTU.N),
acknowledged in its fourth quarter performance conference call
considering exports to Asia from the U.S. West Coast.
Growing demand and delivery problems in key producing
countries have realigned the world coal market in recent
months, making U.S. coal more attractive overseas.
Eastern U.S. coal already is flowing to Europe, and prices
for U.S. coal have been driven past $70 a ton on the New York
Mercantile Exchange, nearly doubling in a year.
Talks and planning were described as preliminary and few
details were available.
UP spokeswoman Zoe Richmond said, "It would be premature to
comment until we have all the I's dotted and T's crossed."
Denis Horgan, vice president and general manager of
Westshore, said the terminal has handled Wyoming coal in the
past and that high prices are stirring new interest.
"We've had inquiries on Utah coal, a much higher BTU coal,
which is even farther away," said Denis Horgan, vice president
and general manager of Westshore.
In a quarterly conference call Jan. 31, Peabody Energy Corp
(BTU.N) executives said they already have shipped some western
bituminous coal to Japan through California.
But California port capacity would be limited, Peabody
Chairman and CEO Greg Boyce said.
"If exports were to significantly ramp up directly out of
the West Coast, then the port of Vancouver would have to come
UP serves Long Beach and other ports on the west coast,
from California to Oregon to Washington.
"There is some ongoing discussion about getting coal
through here," Port of Long Beach spokesman Art Wong said.
Storage barns used for pet coke at Long Beach are full, so
accommodation would have to be made, he said. In the past, coal
trains parked nearby, but neighborhoods complained, he said.
"I heard they were going to send a test shipment to see
what other pieces (of the puzzle) are missing," the Long Beach
Any plan to expand coal-exporting facilities at Long Beach
beyond existing capacity probably would raise environmental
questions, Wong said.
The other big West Coast port, Los Angeles, has quit the
coke export business, partly because of community environmental
opposition, Port of L.A. spokesman Gordon Smith said.
"The port is in the process of demolishing its old coke
export terminal and would not be receptive to getting involved
in that business again," Smith said.
(Reporting by Bruce Nichols; Editing by David Gregorio)