Coal terminals near New Orleans expanding despite drop in coal
exports
Washington (Platts)--14Feb2014/434 pm EST/2134 GMT
Despite a drop in coal exports off the Mississippi River in 2013,
several New Orleans-area terminals say they are increasing capacity as
they eye improved markets in the long-term.
Foresight Energy's Convent Marine Terminal in Convent, Louisiana, is
installing two stacker-reclaimers, roughly doubling its annual capacity
to 25 million st, according to a review of state permits.
A company employee confirmed an expansion is underway, with a completion
date targeted for the end of 2014, but declined to discuss the expansion
further.
Foresight, which operates a number of low-cost long-wall mines in the
Illinois Basin, purchased the terminal in 2011 from Canadian National,
which continues to deliver coal to the terminal.
The railroad's chief marketing officer, Jean-Jacques Ruest, told
investors at a conference in Coral Gables, Florida, Wednesday that the
terminal expansion is "very much part and parcel of the expansion they
need to access world markets."
"They have low-cost longwalls, access to water, unit train capacity, the
ability to blend with other coal to play with sulfur content and then
now they need to go and get sales," said Ruest. "For us, it means we
have aligned ourselves with the low-cost player and eventually the
market will get better, and we will be able to benefit."
US coal exports hit a record 126 million st in 2012, and exports through
New Orleans for the year totaled 28.1 million st, according to the US
Energy Information Administration.
Through September 2013, the latest data available, coal exports through
New Orleans total 14.6 million st, according to the EIA. Shipping agency
T. Parker Host told Platts it estimates 2013 exports through New Orleans
totaled 20 million st.
The drop is likely due to ongoing softness in the Atlantic market.
Platts on Friday assessed the delivered price of coal (6,000 kcal/kg
NAR) to Northern Europe at $80.20/mt.
Despite the current decline, exports are likely to pick up in future
years, according to market observers. The particularly holds for
Illinois Basin coal, which has similar heat values but significantly
lower production costs compared with Appalachian coals.
United Bulk Terminals, which operates its river terminal near Davant,
Louisiana, is also undergoing an expansion that will push its annual
capacity to roughly 22 million st.
Brian Miles, vice president of sales for the terminal, confirmed the
expansion but would not comment on the amount of tons the terminal
handled in 2013, only to say it was a similar amount to 2012. The
terminal processes both exports and coastwise shipments.
Trafigura's new terminal, the Burnside Terminal, near Darrow, Louisiana,
recently started up operations along the river near New Orleans after
renovating an existing bulk terminal.
The International Marine Terminal, owned by Kinder Morgan and also near
Davant, historically averages roughly 3.6 million st of exports
annually, said company spokesman Richard Wheatley. He did not provide
exact figures for 2013.
The Mississippi River around New Orleans is also home to several
midstreamers, who use floating cranes to load bulk vessels directly from
barges moored in the river.
Attempts to reach St. James Stevedores and Associated Terminals, two
midstreamers in the region, were unsuccessful.
--Andrew Moore,
andrew.moore@platts.com
--Edited by Derek Sands,
derek.sands@platts.com
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