Is It A Coal Terminal? A Grain Terminal?
The project includes plans for two railroad receiving terminals and a wharf (also referred to as a pier). Layout at the site is shown in these drawings provided by SSA Marine. The drawings are essential to understanding the project. References below refer to this set of drawings. A handy companion document that includes simple facts and an artists rendering of the the site is SSA’s overview document found here.
The first page of the drawings shows both terminals superimposed on a photo of the site. The West Loop, in blue on the left, is for generic bulk commodities. This is essentially the same as the terminal originally proposed in 1992 and granted a permit in 1997. It was designed for potash, coke, grains, some 20 listed possibilities – coal not being among them. That original permit was challenged in the Courts resulting in a Settlement Agreement in 1999 that added more conditions. The primary difference between the original permit design and new proposal are the large increase in physical size of the site, a 25% reduction in capacity from 8.2 million tons per annum to 6 million tons for the multi-purpose West Loop terminal, and the addition of a dominating 48 million ton East Loop terminal to service coal (only this coal facility will be built in the first phase of development).
In the 14 years since the 1997 permit was issued market demand never materialized to justify building the original multi-purpose terminal. Sufficient demand remains a problem and neither the West Loop bulk terminal nor the wharf equipment to handle its commodities is planned to be included when the project is first built (more on construction staging below). SSA does not anticipate grains as a likely commodity in the first 10 years of operation (PID Chapter 4 page 4-51).
Also on the first page of the drawings is the East Loop shown in green. This is the dedicated coal terminal which has a 48 million tons per annum capacity. This is an entirely new terminal with eight times the capacity of the West Loop. At capacity it would be the largest coal terminal on the continent. Unlike grain and other commodities, the push to export coal is so great that SSA has already announced a contract for the entire 24 million ton capacity planned for the initial construction stage.
Contained within the embankments of the East Loop is an 80 acre open-air stockyard that can store 2.75 million metric tons of coal in four lines of coal stacks. Each line of stacks is serviced by a 115 foot high stacker/reclaimer. The 4 vertical lines on the page 3 drawing shows their location. It depicts the full capacity layout of 4 inbound and 4 outbound tracks (8 total) required to feed the loop around the storage area and the two tandem dumping stations where multiple cars at a time can be rotated to empty their contents.
Construction is planned in stages. As currently planned, stage 1 will include administrative offices, the wharf, and the coal terminal. The coal terminal in stage 1 will be fully laid out but only half of the capital equipment is currently planned to be installed. Because construction will not begin until after the two to three year the permit process, SSA has been quick to remind us that the investors are there to make a profit and final construction decisions will be driven by markets at that time.
So while the Project Information Document includes some “expected” time frames for additional stages, they are essentially estimates. SSA has been clear that if more contracts for coal are forthcoming they will install the additional equipment to increase capacity sooner, perhaps during initial construction. This makes eminently good sense to any business person. Surely competent management was a big part of the reason Goldman Sachs purchased a 49% stake in SSA indicating confidence that rational economic decisions will be made. The logical corollary is that SSA would not be inclined to invest in the West Loop bulk terminal until there is sufficient demand to make it profitable. When, and if, market conditions might provide that demand remains an open question.
A large contract for Canadian potash, delivered with a high volume of unit trains through White Rock and Blaine, would be the most likely economic driver for the West Loop.