Advocates for the Gulf Sue Coal Export Terminal for Polluting Mississippi River

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Environmental advocacy groups this morning filed suit against the United Bulk coal export terminal in Davant, LA, for violating the federal Clean Water Act. Photographs, video footage and satellite imagery document piles of United Bulk coal and petroleum coke that generate highly polluting dust and debris.

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The imagery shows plumes of coal-polluted water spreading into the Mississippi River from the United Bulk terminal. The terminal, owned by United Bulk Terminals Davant LLC, has operated for more than four decades, shipping millions of tons of coal and petcoke every year to overseas markets.

“The coal and petcoke sit in huge, open piles along the river,” said Warren Lawrence, who lives in the neighboring community of Myrtle Grove. “So when there’s rain and wind, it just blows right into the river and the wetlands. The natural environment is the reason people love this area, and the coal is destroying it.”

Gulf Restoration Network, Louisiana Environmental Action Network (LEAN) and Sierra Club filed suit in New Orleans’ U.S. District Court for the Eastern District of Louisiana. The groups, represented by Tulane University’s Environmental Law Clinic, are members of the Clean Gulf Commerce Coalition, which is working to clean-up existing coal terminals in the Gulf Coast region, stop any new coal export terminals, and promote cleaner, safer industries and jobs.

The suit contends that United Bulk has illegally discharged coal and petcoke into the river every day that it has operated for at least five years. It points out that coal and petcoke—an oil-refining byproduct with high levels of arsenic, mercury and other toxins hazardous to human health and aquatic life—have been discharged into the river in enough quantities to produce visible spills on a regular basis. The suit also cites the U.S. Environmental Protection Agency’s determination that stormwater runoff from coal piles “can flush heavy metals from the coal, such as arsenic and lead, into nearby bodies of water.”

LEAN Executive Director Marylee Orr said that conservation groups and community residents hope that United Bulk will adopt a more environmentally responsible approach. “We’re hopeful that we’ll be able to work with the company to clean up the facility and make it safer for workers, communities and the environment.”

Today’s legal challenge follows the suit filed last fall by Clean Gulf Commerce Coalition organization against Louisiana’s Department of Natural Resources for its illegal approval of a coastal use permit for the proposed RAM coal export terminal in Myrtle Grove in Plaquemines Parish. The suit argues that the RAM terminal conflicts with the state’s master plan for restoring Louisiana’s disappearing coastal wetlands.

“The expansion of coal exports and the associated pollution to the Mississippi and surrounding communities and wetlands flies in the face of Louisiana’s coastal master plan,” said Scott Eustis, Gulf Restoration Network’s coastal wetland specialist. “The river is a valuable and limited resource for rebuilding our coastal wetlands, without which we cannot continue to live in Louisiana.” 

Louisiana is at particular risk from increased coal exports through the Mississippi River. Three terminals along the Lower Mississippi, including United Bulk, are seeking to dramatically expand exports, which would increase the amount of coal and petcoke stored in open piles, blanket nearby areas in dust and discharge more coal-polluted runoff into vital coastal wetlands.

The international market for U.S. coal has also grown increasingly volatile. Port authorities on the West Coast and in Corpus Christi, TX have concluded that the coal export market is simply too risky to invest significant sums in new or expanded shipping facilities.

“When you look at the big picture, the existing coal terminals in Louisiana are too dirty, and shipping more coal through Louisiana at new terminals is simply too risky,” said Al Armendariz, senior campaign representative with Sierra Club’s Beyond Coal campaign. “The international markets can’t be counted on, the changing climate creates too many variables, and local communities don’t want to be the coal pipeline to India and China. Louisiana leaders should focus on solutions that will help communities prosper—coastal restoration and tapping into the clean energy economy now.”

Both Clean Gulf Commerce Coalition and the Power Past Coal coalition in the Pacific Northwest are focusing attention on health, safety and environmental impacts of existing coal export systems, including shipping coal by rail from mines to the ports.

The Clean Gulf Commerce Coalition includes: Air Alliance Houston, Gulf Restoration Network, Louisiana Environmental Action Network, Lower Mississippi River Keeper, Public Citizen, Sierra Club, Texas Environmental Justice Advocacy Services and Texas Organizing Project.

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GAO Report Confirms Coal Leasing Program ‘Out of Date,’ Costs Taxpayers Nearly $30B

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The U.S. Government Accountability Office (GAO) today released the result of its investigation into coal leasing practices at the Bureau of Land Management, which confirmed earlier reports that coal companies have taken advantage of a lax bidding process for leasing coal on publicly owned lands, resulting in nearly $30 billion in loss for U.S. taxpayers. Sen. Ed Markey (D-MA) echoed the Sierra Club, Greenpeace and other environmental and community advocacy groups in calling for a temporary suspension of the federal coal leasing program. 

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“The Interior lacks rigor and oversight in determining the fair market value of federal coal leases,” said Sen. Ed Markey and Rep. Peter DeFazio in a joint statement on the report. 

“Given the lack of market competition in coal leases, if the fair market value set by Interior is low, it can lead to significant losses for taxpayers. For instance, for every cent per ton that coal companies decrease their bids for the largest coal leases, it could mean the loss of nearly $7 million for the American people.”

This is the second federal report, after the Inspector General’s report in June of 2013, showed significant financial losses from the troubled coal leasing program.

“For decades coal companies have exploited a flawed and lax federal leasing program to buy coal on public lands for pennies on the dollar, costing the U.S. taxpayer billions and subsidizing dirty, coal-fired power plants that have contributed to health problems and premature deaths for thousands of American,” said Bill Corcoran, deputy director of the Sierra Club’s Beyond Coal campaign.

“This independent assessment shows why change must happen in the federal coal leasing program. Interior Secretary Sally Jewell and the Bureau of Land Management owe it to American taxpayers to suspend the current leasing program until coal companies are paying a fair price for publicly-owned coal.

The GAO report adds to the mounting pressure to reform the federal coal leasing program. However, this report does not address broader problems with the federal coal leasing program such as its role in unlocking huge quantities of carbon pollution. In December 2013, a report from the Bicameral Task Force on Climate Change recommended that the Department of Interior reform the federal coal leasing program to help implement President Obama’s Climate Action Plan, stating, “BLM should also revisit policies that subsidize fossil fuel development on federal land by increasing royalty rates for federal coal leases, reviewing its procedures for determining “fair market value” during its coal leasing process, and reforming its leasing practices in the Powder River Basin.”

“The GAO report is the latest to highlight flaws with a coal leasing program that is rigged to benefit a handful of coal mining companies like Peabody and Arch, and is yet another reminder of the BLM’s failure to account for the coal industry’s plans to boost exports,” said Greenpeace climate and energy campaigner Kelly Mitchell.

“But the larger problem is that the BLM is undermining President Obama’s Climate Action Plan by subsidizing the extraction of hundreds of millions of tons of publicly owned coal. Secretary Jewell should put an end to the BLM’s coal giveaways and start accounting for the costs of carbon pollution and other damage to the environment when setting royalty rates for the sale of publicly owned coal.”

Beyond lost revenue, selling publicly owned coal at such low rates amounts to a major fossil fuel subsidy, favoring coal at the expense of cleaner forms of energy, said Greenpeace. Between 2011-2012, BLM leased more than 2.1 billion tons of coal in the Powder River Basin, unlocking nearly 3.5 billion metric tons of CO2. These and other concerns about the federal coal leasing program were detailed in a letter sent to Interior Secretary Sally Jewell on her first day on the job from the leaders of 21 environmental, health and consumer organizations. More than 135,000 have called on Secretary Jewell to establish a moratorium on federal coal leasing in the Powder River Basin.

Visit EcoWatch’s COAL page for more related news on this topic.

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Goldman Sachs Sells Off Remaining Equity of Pacific Northwest Coal Export Terminal Investment

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News broke yesterday that Goldman Sachs Infrastructure Partners sold off its remaining equity investment in Carrix, the parent company behind the colossal coal export terminal proposal north of Bellingham, WA, according to Rainforest Action Network.

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If built, the Gateway Pacific Terminal at Cherry Point would be the largest coal export terminal in North America and would mean up to 18 coal trains traveling round-trip through local communities. Photo credit: FreeFoto.com

Goldman Sachs did own 49 percent interest in the proposed coal export terminal, which would export 48 million tons of coal to Asian markets each year. The new investor is Fernando Chico Pardo, a Mexican businessman.

“It is encouraging to see a major bank like Goldman Sachs taking a big step away from the coal industry by exiting the partnership behind the Gateway Pacific Terminal at Cherry Point,” said Amanda Starbuck, energy and finance program director at Rainforest Action Network. “The bank’s action sends a strong signal that if we are serious about protecting our environment from serious climate pollution, coal export terminals like the one at Cherry Point simply cannot be built.”

The move comes after coal companies and their investors have shelved three out of six proposed coal export terminals in the Pacific Northwest in the last two years.

“Goldman Sachs’ stepping away from coal export is yet another sign from Wall Street that coal export is a losing investment,” said Crina Hoyer, executive director of RE Sources for Sustainable Communities. “We already know that local Main Street businesses would feel the negative impacts from coal export, and communities across the region are saying no to this bad deal because of health, climate, environmental and economic impacts.”

According to Power Past Coal, recent financial records have shown several of the companies are on shaky financial ground. Market analysis by Goldman Sachs, Bernstein Research, Deustche Bank, Bank of America and other market exports have reported that coal demand abroad is likely on a permanent decline. In an analysis in July 2013 Goldman Sachs wrote, “We believe thermal coal demand growth will slow down in the coming years … the potential for profitable investments in new thermal coal mining capacity is becoming increasingly limited.”

If built, the Gateway Pacific Terminal at Cherry Point would be the largest coal export terminal in North America and would mean up to 18 coal trains traveling round-trip through local communities, threatening the rich biodiversity of the Pacific Northwest. 

“There are many reasons why a company concerned with its reputation would choose to avoid the egregious Gateway Pacific Terminal,” Starbuck said. “This coal export terminal threatens human rights, a thriving Tribal fishery and biodiversity in a sensitive marine environment.”

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Major Victory for Clean Water in Coal Export Battle

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The U.S. District Court for the Eastern District of Washington denied a motion to dismiss, allowing the Clean Water Act case to proceed against BNSF Railway Company (BNSF) for coal contamination of U.S. waterways. The Sierra Club, Puget Soundkeeper, Columbia Riverkeeper, Spokane Riverkeeper, RE Sources for Sustainable Communities, Natural Resources Defense Council (NRDC) and Friends of the Columbia Gorge filed the lawsuit on July 24, 2013, after finding substantial amounts of coal in and along several Washington waterways near BNSF rail lines. A similar case is also pending before the Western District of Washington in Seattle.

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Photo credit: Paul Anderson

According to sworn testimony by BNSF Vice President of Transportation Gregory Fox, “BNSF estimates that up to 500 pounds of coal dust may be lost from the top of each car.” The company currently sends four uncovered coal trains through the state every day, each with an average of 120 rail cars. Based on the company’s figures, BNSF’s trains lose an estimated 240,000 pounds of coal dust  along its route daily.
 
“This victory is the first step in holding BNSF accountable for their continual pollution of our waterways,” said Cesia Kearns of the Sierra Club. “The court’s decision to move the case forward is a step in the right direction to stop coal—and its toxic associates, lead, arsenic and mercury—from further poisoning our fish, our water and our families. We take these threats seriously, and after today’s court decision we hope BNSF finally will too.”
 
The conservation groups point to BNSF’s long history of violating the Clean Water Act, which plainly states that dumping of any kind into a U.S. waterway without what is known as a National Pollutant Discharge Elimination System (NPDES) permit, is a violation of federal law. Each violation of the Clean Water Act carries a fine of $37,500, and the plaintiffs assert that every rail car that loses coal is considered a unique violation—a hefty number when considering four trains a day, at 120 cars each travel through Washington.
 
“BNSF should focus on cleaning up its act instead of facing substantial fines for polluting America’s rivers,” said Morgan Wyenn, NRDC attorney. “We’re committed to holding BNSF accountable for its violations of the Clean Water Act and protecting our waterways from toxic coal dust.”
 
The implications of the case are monumental, as the Northwest has become ground zero in the fight to stop three proposed coal export terminals in Washington and Oregon. If built, Washington communities like Spokane would see an increase of 42 additional uncovered coal trains per day. Residents already experiencing the results of four uncovered daily coal trains say that they hope that this lawsuit will teach BNSF a lesson in corporate responsibility.
 
“BNSF’s plans to increase its daily coal train traffic by more than ten times the current amount is a testament to how important it is that they swiftly and responsibly find a solution to their coal pollution problems before further damaging our precious waterways, like the Spokane River,” said Bart Mihailovich, director of Spokane Riverkeeper. “If they want to continue to be in the risky business of shipping coal, they need to assume responsibility for all of the costs that go along with it. Washingtonians are fed up with subsidizing their dangerous operations with the health of our families and communities.”
 
“We hope that BNSF will start taking their coal dust pollution problem seriously instead of looking for loopholes,” said Brett VandenHeuvel, executive director of Columbia Riverkeeper, an organization that works to reduce toxic pollution and protect salmon in the Columbia River. “It’s time to put an end to illegal pollution and work to restore our waterways.”
 
BNSF is the second largest coal shipper in the nation, shipping coal through 28 states and near countless bodies of water. The original Clean Water suit was filed against BNSF in Washington’s Western District on June 5, 3013.

“This milestone in our case sends a clear message to BNSF and the coal companies that communities along the rail line value clean water and corporate accountability over the profits of big business,” said Crina Hoyer, executive director of RE Sources for Sustainable Communities.

The plaintiffs are represented by the Law Offices of Charles M. Tebbutt, P.C. of Eugene, OR, Andrea Rodgers Harris of Seattle, WA, Jessica Yarnall Loarie of the Sierra Club Law Program and David Pettit and Morgan Wyenn of NRDC.

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