Considering how little personal experience most Pacific Northwest residents have with coal, it continues to have an oversized role in regional politics. This adds interest to news about an ongoing collapse of the U.S. West’s coal industry, an implosion with ramifications for Columbia River communities.
Corporations have been avidly pushing for coal-export facilities, largely as a way to bypass U.S. objections to burning coal by selling it instead to China and other Asian industrial nations. This is creating lots of political smoke in the Longview/Kelso and Bellingham areas of Washington, where companies have forged alliances with some local politicians and labor leaders. The Longview newspaper recently sported a prominent front-page headline, “Courting Coal,” as coal advocates from the Powder River Basin made their most recent junket in support of the gargantuan Millennium Bulk Terminals project.
As has been the case for some time, the online news source Sightline is doing a great job of digesting and explaining coal news. This Tuesday, Sightline’s Clark Williams-Derry summarized how environmental opposition to coal terminals has, in fact, saved coal corporations from making a destructive blunder.
A coal executive told Platts — a division of the McGraw Hill Financial firm — on Oct. 16 that delays in obtaining permits for the Millennium project have shielded coal producers from the Asian economic downtown:
“To some degree, I believe these agencies and environmental groups are doing the coal producers a favor by not approving or supporting the approval of these terminals,” the producer said. “If the terminals were already built and in operation, few, if any, would be exporting coal as current pricing wouldn’t support it.”
These coal companies are clutching at Asia as a financial lifeline. Arch Coal, the nation’s second-largest coal company and one of Millennium’s two developers, is on the verge of bankruptcy. Its corporate debt is now rated “Junk.” Another coal exporter has recently been losing $10 to $15 a ton on its Asian sales. Sightline figures that not having the coal terminals on their balance sheets may have saved coal companies $700 million a year.
Coal’s bad business judgment could easily turn into a financial nightmare for Northwest ports and taxpayers. Thank goodness coal skeptics have kept us out of this quagmire so far.