The sponsor of a proposed Washington state coal port for shipments of the fuel to Asia is suspending work on an environmental review because of Native American tribe's concerns that the project could hurt its fishing rights.
SEATTLE (AP) The sponsor of a proposed Washington state coal port for shipments of the fuel to Asia is suspending work on an environmental review because of Native American tribe's concerns that the project could hurt its fishing rights.
SSA Marine, which retains a 51 percent ownership of the project, said it was halting the environmental review while it waits for the U.S. Army Corps of Engineers to make a decision on the treaty rights of the Lummi Tribe.
The port in the Puget Sound, just south of the U.S.-Canada border, would accommodate almost 60 million tons (54.4 million t) a year of coal and other commodities.
Coal companies hope exports to Asia will shore up their industry, which has been battered by competition from cheap natural gas and more stringent restrictions on pollution caused by burning the fuel.
Construction costs for Gateway Pacific have been estimated at $700 million.
The Lummi Nation has pressed the U.S. Army Corps of Engineers to deny the project's permit because it would disrupt the tribe's fishing practices. The proposal also has met strong opposition from environmental groups worried about the greenhouse gases and other pollutants produced by burning coal.
Cloud Peak Energy bought a 49 percent stake in the Gateway Pacific Terminal six months ago. The Wyoming company paid $2 million up front to SSA Marine and agreed to cover up to $30 million in permitting expenses, hoping to capitalize on the port to serve growing coal markets in Asia.
The deal also included an option for the Crow American Indian tribe to take five percent stake in the port. Cloud Peak plans to build a major mine on the Crow's southeastern Montana reservation and planned to move up to 18 million tons (16.3 million t) of fuel through Gateway Pacific.
But the international coal market is experiencing a sudden and drastic decline. Cloud Peak took a $58 million loss on its investments in coal export projects including Gateway Pacific.
Cloud Peak spokesman Rick Curtsinger said the port remains a “viable project” and the company will continue seeking access to Asian markets to meet long-term demand.
“The partners understood from the beginning that this would be a lengthy and thorough review process,” Curtsinger said.