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Judge allows lawsuit: Seward coal facility faces Clean Water Act suit

Posted: Monday, January 24, 2011

A Clean Water Act lawsuit alleging violations by the Seward Coal Loading Facility was allowed to go forward Jan. 10 by federal district Judge Timothy Burgess.

The coal facility, jointly operated by Alaska Railroad Corp. and Usibelli coal mine subsidiary Aurora Energy Services, has been a sore spot for Seward residents who say the coal dust from operations creates both a nuisance and a public health hazard.

Alaska Railroad Corp. and Aurora Energy Services were denied their bid for dismissal by Burgess.

The lawsuit, filed last January by Trustees for Alaska on behalf of the Sierra Club, Alaska Center for the Environment and Alaska Community Action on Toxins, alleges that a conveyor system delivering coal to export vessels allows coal to fall directly into Resurrection Bay along the length of the conveyor system to the loading facility, as well as from the belt after it loops back underneath itself.

Trustees for Alaska said coal dust from the stockpiles, railcar dumping facility, stacker/reclaimer, ship loader and the conveyor systems fall into Resurrection Bay. There are also concerns over Aurora Energy plowing snow that is allegedly contaminated with coal dust, as well as storm water that flows directly into Resurrection Bay.

The coal dust also blows off the facility's two massive coal stockpiles into the bay, covering nearby fishing charter boats, other vessels and nearby neighborhoods with dust and debris.

"We are pleased that the Court will allow the case to move forward and address the pollution problems at the coal facility in Seward," said Trustees for Alaska attorney Brian Litmans in a statement. "The facility is unable to contain the coal dust and keep coal from going into Resurrection Bay, which violates the law and is an ongoing nuisance and health issue."

The statement from the consortium of plaintiffs also stated Seward was covered with coal dust both on Dec. 10 and Dec. 22.

Last July, the railroad and Aurora reached a joint compliance order with the state Department of Environmental Conservation to pay a $220,000 fine, with most of that money going toward the cost of dust mitigation measures.

Three supplemental environmental projects ordered by DEC were completed on schedule in 2010 and include the installation of additional dust suppression equipment including spray bards, high-pressure spray nozzles and a sealed chute and fogging system on the stacker/reclaimer.

According to Alaska Railroad Corp. vice president for corporate affairs Wendy Lindskoog, another $540,000 in capital expenditures are planned for 2011 regarding dust suppression projects.

Lindskoog said it is company policy to not comment on ongoing litigation.

The Seward coal loading facility, which is located on land owned by the Alaska Railroad, was originally built in 1984 as an economic development project to sell coal to world markets.

Suneel Alaska Corp., the purchaser of the coal for the Korean domestic market, negotiated with the state for construction of the coal dock and a loan from the Alaska Industrial Development and Export Authority. The Alaska Department of Transportation and Public Facilities built the dock and Suneel installed the conveyor and loading systems.

Railroad officials said their participation was limited to leasing waterfront property for the facility and transporting the coal from Healy to Seward under a contract with Suneel.

Suneel and its successor, Hyundai Merchant Marine, continued to purchase coal and operate the facility through the 1990s and into the early 2000s, with AIDEA becoming a co-owner of the facility in 1995.

Hyundai remained the lessee on the property and operated the facility until January 2007, when the railroad entered into an operating agreement with Aurora Energy Services.

Since then, railroad officials said, the Alaska Railroad and Aurora Energy Services have spent more than $1 million on safety, operational and environmental improvements, including significant environmental upgrades to deal with coal dust.

Andrew Jensen can be reached at andrew.jensen@alaskajournal.com.



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