Solid Energy's monopoly of coal-carrying capacity on the Midland rail line has forced a smaller operator to barge its product direct to Australia from the West Coast.
Francis Mining principal Brent Francis said yesterday that his company had just signed a seven-year contract to barge one million tonnes of coal to
Port Kembla, Australia.
Last week, Solid Energy and Toll NZ announced a 13-year contract that would require eight coal trains daily carrying up to 3.8 million tonnes a year to Christchurch over the next 13 years.
Francis said this completely shut his company out of the running and ruled out Lyttelton as an export point.
"Lyttelton would be our port of preference but we don't have that option. There is no longer any coal-carrying capacity for us," he said.
"We had a deal with Solid Energy but they have pulled out, saying they now need all available capacity for their own coal."
Francis could not say whether the option of barging would be much more expensive but he was disappointed to have to go overseas to find a home port.
"We use New Plymouth but Port Kembla [near Sydney] will virtually become our home port from now."
Sea Tow is expecting to double its barging fleet by March next year and there is no concern about future capacity.
A spokesperson said that if there was coal to shift "we'll get it to wherever, whether that's New Plymouth, Shakespeare Bay or overseas".
Grey District Mayor Tony Kokshoorn welcomed the news.
"We knew Francis were in negotiations to barge coal and now it's been confirmed, it's excellent news. That's 140,000 tonnes a year over seven years. It's a step in the right direction for the port."
Kokshoorn said Pike River Coal and Solid Energy had also indicated a willingness to use the port and the prospect of railing their coal to the point of export was becoming more promising each day.
"Talks with Toll Holdings in regard to railing coal to the port have been going well."
Kokshoorn, anticipating a huge increase in export opportunities, said the aim of the new council was to float the port as a company within six months.
- NZPA
