County Coal Ltd., an Australian company that wants to build two mines in the Wyoming end of the Powder River Basin, said it is looking at Canada to develop coal terminal facilities to get its coal onto the export market.
The company, in an April 23 investor update, said it is in the process of submitting plans to construct a +20 million tonne (Mt) p.a. bulk loading terminal in British Columbia that can handle its PRB coal, plus the coals of other U.S. and Canadian producers. The Canadian terminal would be located at an unspecified greenfields industrial site that can accommodate Capesize (+150,000 dwt) vessels for the export of coal and bulk commodities from North America to the Asian market, the company noted. The initial engineering study on the Canadian export terminal indicates the port is technically feasible and initial costing indicates the project is economically viable.
County said it is also in discussions about the development of a second +10Mt p.a. export terminal in the U.S. The proposed northwest U.S. terminal is located on an unnamed brownfields industrial site, with sufficient water depth to accommodate Panamax (65,000-80,000 dwt) vessels.
Both of the proposed export terminal sites are connected by existing rail systems to coal fields in British Columbia and Alberta in Canada, and the PRB in the U.S., which hosts County’s 730 Mt (about 90% in the measured category) of coal resources.
“To date, we have had positive engagement with both the British Columbia Provincial Government and the major stakeholders around the project area. These discussions have given us the confidence to proceed with the project,” said Rod Ruston, County Coal’s Managing Director.
The Canadian government is supportive of the development and expansion of the bulk commodity export terminals. Existing terminals Ridley, Westshore and Neptune have all committed to increase capacity in recent years, County Coal noted.
County said it has engaged AECOM to undertake the initial engineering studies on its Canadian project required for the project description to be submitted to the provincial government in June 2013.
County said it has engaged WorleyParsons to provide engineering advice on the development of the U.S. terminal.
County Coal has two mine projects in the works in Wyoming PRB
County’s two wholly-owned thermal coal projects, Shell Creek and Miller, are both located in the Wyoming PRB and together host 730 Mt of Joint Ore Reserves Committee-compliant thermal coal resources. Shell Creek, in the western region of the PRB, hosts a 420 Mt open-cut and underground JORC-compliant thermal coal resource. Miller, in the eastern part of the PRB, nearer the existing mines in the region, hosts a 310 Mt shallow underground/deep open cut thermal coal resource. Both projects host potentially low-cost, export-quality coal, the company said.
Notable is that nobody currently underground mines in either the Wyoming or Montana ends of the PRB, preferring instead the cheaper production costs of surface mining. Major existing PRB producers include Peabody Energy (NYSE: BTU), Arch Coal (NYSE: ACI), Cloud Peak Energy (NYSE: CLD) and Alpha Natural Resources (NYSE: ANR).
County Coal is in some ways similar to fellow Australian company Ambre Energy, which also wants to run PRB coal mines and develop Pacific Northwest coal terminals to get that coal onto the export market. Ambre has, in contrast to County Coal, lately bought an existing the PRB mine, the Decker strip job in Montana.
As County Coal indicated, it is relatively easy to permit terminal capacity in British Columbia. But about a half dozen coal export terminal projects in Oregon and Washington state have lately been proposed, and in the face of stiff local and national environmental group opposition, at least two of them are apparently dead.