Norfolk Southern (NYSE: NSC) announced Dec. 22 that it will consolidate operations of its coal docks located on Lake Erie in Northern Ohio, which will streamline operations for customers while improving network efficiency and reducing operating costs.
NS plans to idle its Ashtabula Coal Pier and shift operations to the railroad’s Sandusky Dock. Ashtabula will continue to operate until all coal inventories have been transloaded, which is expected to be completed by May 2016. The facility will remain idled until and if market conditions warrant reopening.
“Norfolk Southern is committed to providing shippers with an efficient transportation network, and we are actively addressing the industry-wide decline in coal volumes by streamlining operations and positioning our railroad for long-term success,” said David Lawson, NS vice president coal marketing.
The consolidation will help Norfolk Southern achieve efficiencies by reducing capital investment requirements and employee headcount. A total of 21 positions will be affected as part of the transition. Earlier in December 13 employees at Ashtabula were furloughed due to coal market conditions. Six employees will continue to oversee security and environmental systems at Ashtabula.
Norfolk Southern has owned and operated the Ashtabula coal pier since 1999. The facility primarily serves the thermal coal market, transloading coal from Ohio, Pennsylvania and West Virginia to Canada and U.S. destinations by ship. Another major railroad, CSX Transportaton, also has rights to use the Ashtabula dock.
“Coal has been – and continues to be – a significant part of Norfolk Southern’s heritage of service and success,” said Mike Wheeler, NS senior vice president operations. “Our customers depend on us to provide a high-performing, 21st Century transportation option that is safe, efficient, and reliable. Norfolk Southern is adapting to evolving market conditions by realizing efficiencies and optimizing our infrastructure to support long-term growth.”
Ohio is a strategic part of Norfolk Southern’s 22-state rail network. NS operates 2,200 miles of track and employs more than 3,700 people in the state, providing connections to domestic and international markets for Ohio-based manufacturers and businesses. In 2014, NS doubled the size of its Bellevue, Ohio, yard in a $160 million expansion project, creating the largest rail classification yard in the eastern U.S.