GPT Train Traffic and Local Taxpayer Impacts

New Report:  Coal Train Traffic to Canada and Gateway Pacific Terminal:

An analysis of the ‘Coal Trains are Coming Anyway’ Statement and its Implications for Local Taxpayers

Primary Documents:
Download Report
Download Executive Summary
Download CWB Press Release

Read Media Coverage Now:
Press Page 

Key Report Findings:

  • High-volume coal train traffic cannot run through Whatcom County to Canada, as B.C. coal terminals, even post-expansion, will not have the capacity to accept high volumes of U.S. coal.
  • The total coal export capacity from B.C. terminals will be 69.5 million metric tons per year (Mtpa) when expansion work at all three coal terminals is completed by 2015.  However, an analysis of the available data shows that only 4 – 6 Mtpa of the post-expansion capacity remains unsecured by long-term export contracts and available for additional U.S. or Canadian coal exports.
  • The claim that “trains are coming anyway” through Bellingham en route to B.C. that is made by Gateway Pacific Terminal proponents has important financial consequence for local taxpayers.
  • If the claim were assumed to be true, then GPT can make the case that the project is not responsible for increases in train traffic and train impacts on Bellingham (or anywhere off-site) and should not be included in the project’s environmental impact study.
  • The costs to mitigate GPT’s train impacts would then be added to the local residents’ tax burden rather than becoming a project expense.
  • New coal export volumes of 4 to 6 Mtpa equate to approximately 1 to 2 additional coal trains per day (half empty) through Whatcom County en-route to B.C.  In contrast, the proposed GPT terminal would generate 18 additional trains per day (16 of them for coal) to and from Cherry Point traveling through Whatcom County.

About This Report:

“Coal Trains are Coming Anyway” is a statement often heard in support of the development of the Gateway Pacific Terminal (GPT) at Cherry Point.

The “Coal Trains Are Coming Anyway” statement has been used publically by SSA Marine officials and spokespeople, is routinely referenced by non-compensated project proponents (e.g. in blog comments and letters to the editor in local newspapers) and repeated by community influencers, such as a representative of the Bellingham / Whatcom County Chamber of Commerce.

Terminal proponents point to the present expansions underway at the three B.C. terminals to make the case that Powder River Basin (PRB) coal mined in Wyoming and Montana will continue north through Whatcom County on the rail lines to Canadian facilities, even if the GPT is not built.

The purpose of the present analysis is to examine the factual basis of the “Coal Trains Are Coming Anyway” statement and examine the public policy implications of such claims for local taxpayers.

To construct this analysis, the project team reviewed extensive documentation including coal export agreements, public financial statements including quarterly and annual reports, Securities and Exchange Commission filings, terminal and port long-range planning documents, industry press releases and related white papers.

A review of the data concerning 1) existing B.C. terminal export capacity, 2) additional B.C. export capacity resulting from on ongoing expansions, and 3) secured coal contracts coming into effect at later dates, fails to demonstrate a factual basis for this assertion.

To the contrary, the analysis indicates that few coal trains could run through Whatcom County to Canada if the Gateway Pacific Terminal is not built.  The combined throughput capacity for coal exports from B.C. terminals will be 69.5 Mtpa when ongoing expansion work at all West Coast Canadian coal terminals (Ridley Terminals in Prince Rupert, Neptune Terminal in Vancouver, and Westshore Terminals at Roberts Bank) is completed at the end of 2014.  However, it appears that only 4 – 6 million tons per year (Mtpa) of the post-expansion capacity will be available for additional U.S. coal exports.  This figure equates to roughly 10 percent of GPT’s overall coal export capacity.

Heavy coal train traffic in Whatcom County over the next 10 years will only occur as a direct result of the development of the Gateway Pacific Terminal.  When an accurate accounting of limited B.C. capacity for additional U.S. coal exports is considered, the policy implications change.  Heavy coal train traffic and its impacts in Whatcom County are not inevitable; they would be a direct result of GPT’s construction.  This direct impact suggests that:

1. The impacts of coal train traffic along the rail corridor should be included as part of the GPT’s Environmental Impact Study.
2. The active siding along Bellingham’s waterfront should be included in the project permit itself, as it is required to service GPT.
3. The significant costs of GPT train-related mitigation should not be left to the local taxpayers by default, but rather covered by the project sponsors as part of the true cost of doing business.

If the “trains are coming anyway” claim is true, or is accepted to be true, it will shift the extensive and expensive impact mitigation costs from the project beneficiaries onto the City and County.  Understanding these facts is critical for local citizens and decision-makers. That is why we have chosen this subject for our third in a series of comprehensive reports to the City.

 

The Communitywise Bellingham Report Series:

In March 2012, we began publishing a series of reports examining the potential environmental and economic impacts of the proposed Gateway Pacific Terminal. The intention is to provide a solid, independently researched resource for the community.

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