Usibelli hopeful coal will head to Korea, again

Posted: Tuesday, March 25, 2003

ANCHORAGE (AP) -- Usibelli Coal Mine is negotiating with Korean buyers in hopes of providing Healy coal once again to an Asian power plant.

Coal exports from Alaska to Korea tapered off last year and concluded in October when Usibelli couldn't agree on price terms with its largest customer.

As a result, 30 to 35 people -- almost one-third of Usibelli's work force -- lost their jobs last year at Alaska's only operating coal mine.

Steve Denton, vice president of business development at Usibelli, told Petroleum News Alaska, that he's ''reasonably optimistic'' that a renewal contract can be negotiated.

''We had already reduced our price to the coal mine to the point where it was not prudent to try to continue to reduce it any further,'' Denton said, about the past failed contract talks.

But he's now optimistic that coal shipments to Korea will resume, possibly before this summer.

The change comes, in part, from $9.6 million in federal funding that's been allocated to the coal loading port facility in Seward.

A reduction in transportation costs could make the difference in the bottom-line price for Usibelli coal, Denton said.

He said he expects to reach a contract agreement before summer.

Yearly coal shipments to Korea have ranged from 600,000 to 750,000 metric tons, Denton said.

Current contract talks indicate that Usibelli will provide about 400,000 metric tons of coal for the Korean contract, Denton said.

Usibelli will need to rehire six to nine people to meet the contract requirements.

Since 1984, Usibelli has shipped more than 17 million metric tons of coal from Healy to the Honam power plant, owned by Korea Electric Power Co., according to the company's website.



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