Published: December 22, 2022 |

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The owner of Montana’s largest coal mine is suing BNSF after a year of shipment struggles that Navajo Transitional Energy Company alleged has cost millions of dollars.

NTEC, owner of Spring Creek Mine in southeast Montana, said in a lawsuit filed Monday that it was only able to get 2.9 million tons of coal to port through November of this year. It had expected to ship 5.5 million tons, possibly more, but couldn’t get train service for coal shipments.

The mining company, which bought Spring Creek at bankruptcy auction in 2019, accuses BNSF of breach of contract for not providing enough locomotives to shuttle coal to Vancouver, British Columbia. For years, Spring Creek relied on coal sales to power plants in South Korea and Japan, by way of Westshore Terminal in Vancouver, B.C.

Spring Creek is Montana’s largest coal mine, producing about 13 million tons a year. The mine previously owned by Cloud Peak Energy. Spring Creek is the second to Signal Peak in coal exports. Both mines ship out of Vancouver, which is roughly 1,400 miles away by rail.

It takes about one trainload a day to get 5.5 million tons of Spring Creek to port, NTEC said. Each shipment is about 15,125 tons. This year, the trains shipping from Spring Creek averaged 18 trains a month, according to NTEC, with up to 15 days between shipments.

Ships waiting for the coal deliveries in B.C. billed NTEC more than $15 million in demurrage charges. NTEC alleges that it lost $150 million in revenue as a result of shipping issues.

NTEC alleges that the BNSF had taken on new coal customers to the disadvantage of Spring Creek shipments.

For its part, BNSF had reported rail challenges throughout the year.

Monday, the online news service Wyofile reported that coal-fired power plants dependent on Powder River Basin coal were running less because of supply shortages. Union Pacific Railway was the target of the complaints by the National Coal Transportation Association.

Xcel Energy reported $123 million in losses related to coal supply issues, according to Wyofile. The Wyoming Mining Association reported a 30-million-ton reduction in coal shipments because of rail problems.

In Montana, for the first time in years, mines servicing domestic power plants led the coal industry in production gains, though growth was a modest 1.5 million tons for all mines.

Source: Casper Star Tribune

About NTEC
NTEC was created in a pioneering effort by the Navajo Nation to achieve greater sovereignty over its natural resources. NTEC was established under Navajo law and operates as an autonomous commercial entity with an independent board of directors.

To stop by NTEC’s website, CLICK HERE

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