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Miller says state could build West Coast port to ship coal

Feb 27, 2014 - By Eric Blom, Staff Writer

State Rep. Dave Miller thought West Coast ports were not shipping enough Wyoming coal, so he had an idea: Have the state build its own.

Miller brought his plan to the Wyoming Legislature, and it looks to have a head of steam behind it. The Riverton Republican believes Wyoming's coal industry could grow if it sold more coal to Asia, but ports on the West Coast lack capacity to ship enough of the product.

"In order to keep our revenue stream strong, we need to export our coal," he said in an interview before the legislative session started.

Severance tax on coal production produces a large portion of the state's revenue, he said.

The bill passed the state House of Representatives unanimously and was referred to the Senate. The upper chamber's Minerals Committee voted Monday to support the measure, but the full Senate has yet to take it up.

State Sen. Eli Bebout, R-Riverton, cosponsored the bill.

Private industry already is making plans to ship coal from several northwestern ports, but concerns about environmental issues have hampered those efforts.

Wyoming's Infrastructure Authority's purpose is to promote consumption of the state's energy products by planning, financing and building electricity transmission facilities and advanced coal technology plants. Miller's bill would allow it to develop "coal distribution facilities, including coal ports."

To build a piece of infrastructure, such as a port, the authority would issue a bond to raise money. Then, it would plan and build the facility. Afterward, the authority would pay back the bond holders with revenue the new infrastructure generates.

Wyoming produced less coal in 2013 than 2012, Miller said, and he blamed the drop on increased Environmental Protection Agency restrictions on coal-fired power plants on the U.S.

County, state and federal officials are reviewing current plans to ship coal from two ports in Washington state and one in Oregon. The vetting process could take two years for some of the facilities, but projections are for the three ports to ship 110 million tons of Wyoming coal to Asia, mostly through Bellingham, Wash.

Elected officials and environmentalists in Washington, Oregon and Montana in the past year have raised concerns with federal officials about environmental impacts of moving coal in trains from Wyoming and Montana to the West Coast. In line with those concerns, the federal Surface Transportation Board decided in December that BNSF Railway could require coal shippers to reduce coal dust during rail shipping. In June, however, the U.S. Army Corps of Engineers decided against a broad environmental impact study on shipping coal from Washington, instead performing more-limited investigations.

Miller does not expect Wyoming actually to build the port because he thinks the prospect of the state owning a port would spur private companies to construct one and make money from it.

"I fully expect the private sector to step up, just because they don't want government involved in projects like that," he said. "They finally would find out a way to do it with their own money."

Wyoming now exports about 4 million tons of coal annually, Miller said, but he hopes a new port would ship 50 million to 100 million tons of the state's coal.

Increased tax revenue would benefit many state programs in Fremont County, such as K-12 schools, Central Wyoming College, and the Wyoming Life Resource Center in Lander, he said.

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Legislature, Wyoming