Big Coal Targets Northwest to Get to Asian Markets – Environmentalists Fight Back

Cherry Point Reach, Washington State

In Cherry Point, Washington, north of Bellingham, conservationists have worked for more than a decade to restore the annual herring runs that occur off the coast. Over the past 40 years, stocks have declined on this 10-mile stretch of coastline from about 17,000 tons of herring spawning off the coast to less than 1,000 tons.

Biologists who have studied the problem blame three refineries, which combined see about 600 to 700 ship visits per year. Now one of the world’s largest shipping companies, SSA Marine, wants to build a new terminal here with the potential to ship up to 50 million tons of North American coal annually to China. The so-called Gateway Pacific Terminal would double ship traffic with much larger vessels and increase rail traffic in the region.

Matt Krogh

Matt Krogh, a spokesman for the nonprofit ReSources For Sustainable Communities, says the coal terminal would be slotted between the other refineries and “uniquely placed in the exact wrong area for impacting the herring.”

“Coal dust is high in hydrocarbons and you can’t control dust from a terminal,” Krogh says. “At low tide, herring eggs are exposed. They are also sensitive to high pH levels. So you have these unique circumstances all being put right in front of them.”

This month, Washington officials began holding public meetings in preparation of an environmental impact assessment on the project. The turnout has been huge, Krogh says, with 2,000 people coming out in Bellingham on October 27 against the project and just 20 people there in favor.

Such public opposition is becoming more and more prevalent throughout Washington and Oregon where mining interests want to construct five new shipping terminals, including the one in Cherry Point, as launching off spots to coal markets in Asia. Conservationists, meanwhile, do not want the “green” Northwest being used as a staging ground for burning dirty fuel in Asia that would increase global warming.

“There’s this huge economic sucking sound,” Krogh says. “This area has the reputation of being green and looking toward the future of alternative energy and now it might be turned into a highway for carbon-based export.”

The coal would originate largely from Wyoming’s Powder River Basin where mining companies are buying up additional mineral leases in no-bid contracts from the Bureau of Land Management. Kevin Dowling, spokesman for the Western Organization of Resource Councils located in Montana, says the future of coal is riding on foreign exports and the opportunity for big profits.

Peabody Energy, for example, bought two tracts of land known as North and South Porcupine in BLM land auctions earlier this year. As often the case, there was only one bidder, which picked up mineral rights at $1.11 per mineable tons of coal. That same commodity in China can sell for more than $100 per ton.

“They are actually bidding against us because we set a fair market value and they have to either meet or exceed that fair market value,” says Mary Scott, spokeswoman for BLM’s Wyoming office. “There may not be more than one bidder because that company already has the infrastructure in place. It may be a continuation of operations. Another company, if they were to bid on it, would not be economically feasible.”

Wyoming coal already fuels a significant share of the nation’s energy supply. Prospects of selling coal to Asia, however, has reinvigorated an aging industry as well as conservation groups that have opposed coal mining since the 1970s.

“Some of our groups – 40 years old – formed over coal issues,” Dowling says. “Plans to develop coal mines and power plants and a whole slew in northern Great Plains and basically turning it into a national energy sacrifice area have existed since the 70s.”

Standing to gain from exporting coal overseas are the mining companies such as Peabody and Ambre Energy, railroads such as Burlington Northern Santa Fe and shipping companies like SSA Marine, which earlier this year sold a 49 percent stake to Goldman Sachs. Together, these and other interests have formed the nonprofit Alliance for Northwest Jobs & Exports to help persuade public opinion over the terminals. An analysis by ThinkProgress found the group spent $866,000 on media buys in Oregon and Washington since the group formed in July.

Lauri Hennessey

Spokeswoman Lauri Hennessey says the group was created in response to growing press coverage and concerns by environmentalists.

“The companies involved including the rail lines wanted to put out the other side of the issue,” Hennessey says. “I would say the issue was already heated but now I’m hoping people are getting two perspectives.”

Hennessey says concerns are largely based on misrepresentations. Coal dust, for instance, does not travel hundreds of miles off passing trains, she says. “It’s an effort to alarm people more than they need to be alarmed. People talk about train traffic. We keep finding numbers are skewed out there that just aren’t true.”

Like so many of the big environmental debates of the era, this one stands the chance of coming down to jobs versus the environment and public health. The construction of the terminals requires huge investments that promise to bring jobs in a struggling economy and a smaller number of permanent positions once the coal begins moving.

The Cherry Point project intends to create 4,400 jobs and $92 million over two years in tax revenue for state and local services.

Two companies are vying for terminals at St. Helens in Oregon on the Columbia River near Puget Sound. Kinder-Morgan, which operates hundreds of terminals in the United States, expects to spend close to $250 million on a new terminal. Another venture known as the Morrow Pacific Project would spend about $150 million on a terminal to receive barges loaded with coal, which would then be offloaded to ships for Korea and Japan.

“That would be a significant improvement to facilities as well as a significant impact to the port’s ability to reinvest in our community,” says Patrick Trapp, executive director, at the Port of St. Helens.

Patrick Trapp

Trapp says the two projects are waiting approval from the Army Corps of Engineers and the Oregon Department of Environmental Quality.

“I understand there are people passionate about this for a variety of reasons whether its concern about burning it or as a natural resource,” Trapp says. “From a business standpoint we have to look at those impacts and whether they are being held to the same standards as others in their class. So there’s a level of fairness.”

Down in Coos Bay near Oregon’s southern border, a partnership between Metro Ports and Mitsui & Co. (USA), Inc. (Mitsui USA), a Japanese trading company, expects to spend about $250 million on a new terminal and around $150 million for railroad upgrades. That would amount to about 1,300 construction jobs and 165 ongoing positions with average compensation of $110,000.

“Locally my sense is it hasn’t been controversial here,” says Elise Hamler, port spokeswoman. “For one thing, it’s still conceptual. We’ve been very upfront saying that if this project is built on port property it has to be fully contained; all waste water has to be fully treated. All rail cars have to use the best technology available to control dust emissions. There aren’t a lot of questions in this community about what would happen if it’s built here and what would be required. From the fugitive dust standpoint we’re doing our best to address that issue.”

Dr. Andy Harris

Dr. Andy Harris, an advisory board member for Physicians for Social Responsibility, believes Oregonians understand the big picture and may resoundingly oppose coal interests in the region.

“When it first came up, industry was hoping this was going to be a jobs-versus-the-environment discussion, and it’s really morphed into a public-health-versus-special-interest type of issue,” says Harris, who believes the recent advertising blitz did more to hurt the industry than anything else.

“It just makes it look like this is an out-of-state special interest,” Harris says. “It turns it into David and Goliath.”

The Oregon public has largely rejected coal in recent years. The public debated for years whether to shutter a dirty coal burning power plant in Boardman run by Pacific Gas & Electric, which two years ago agreed to close the plant by 2020.

Coal Reclaimer

“It was a practical decision on the basis of the company but also a lot of public pressure saying we don’t want to burn coal, we don’t want to breathe it and, in fact, we don’t want anything to do with coal at this time. Oregon is interested in clean renewable energies and we’ve moved on from this 19th century fossil fuel.”

If not burned regionally, the coal shipped through Oregon would get burned in Asian power plants, contributing to greenhouse gas emissions globally. Emissions could also blow toward the northwest on the trade winds. Harris and others fear opening the Northwest to coal export would encourage more coal-burning plants globally.

“Instead of doing what we think we should be doing and we are doing, it’s like we’ve taken a whole step backward,” Harris says.