Judge Upholds Oregon Denial of Coal Export Permit

The ruling that blocked the proposal for the Coyote Island Terminal project is a blow for Montana and Wyoming

By Gillian Flaccus, Associated Press

PORTLAND, Ore. – An administrative law judge in Oregon on Friday found that state regulators acted within their authority when they rejected a proposed coal terminal on the Columbia River that would funnel millions of tons of American coal to power-hungry Asia each year.

The Oregon Department of State Lands did not overstep when they blocked the proposal for the Coyote Island Terminal project at the Port of Morrow because of potential impacts on tribal fishing grounds, Administrative Law Judge Alison Greene Webster said. The ruling is a blow for Montana and Wyoming, both of which had appealed the 2014 decision on grounds that state laws protecting the environment do not take precedence over federal commerce protections enshrined in the U.S. Constitution.

“This is a huge, huge decision,” said Brett VandenHeuvel, executive director of Columbia Riverkeeper, said of Friday’s action. “If you look back at some of their statements previously, these have been their No. 1 talking points.”

The ruling does not end the case, however. Next up is a November hearing on appeals related to the environmental questions about the impacts on state water resources, including potential damage to fishing grounds guaranteed to Northwest tribes by treaty.

The Port of Morrow and Coyote Island Terminal LLC also have appealed and the Umatilla, Warm Springs, Yakama and Nez Perce tribes have all intervened.

Neither Wyoming Attorney General Peter K. Michael nor Portland attorney James Mountain Jr., who represents Montana in the case, immediately returned a request for comment late Friday.

The project was proposed by the Australian company Ambre Energy and is part of a plan to transport coal mined from the Powder River Basin in Montana and Wyoming through Oregon on its way to Asian markets. The Brisbane-based company proposed bringing the coal by train to Boardman, Oregon, where it would be loaded on barges at the Port of Morrow and then sent down the Columbia River to the Port of St. Helens, where it would be transferred to oceangoing ships.

The company said it would pay $850,000 in annual fees to each of the two ports while paying property taxes in Morrow and Columbia counties. The project was expected to generate several hundred jobs during construction at the Port of Morrow and add about 30 port workers permanently.

Wyoming, the nation’s leading coal-producing state, has been looking to Asia amid competition from cheap and abundant natural gas and tighter federal regulations on coal mining that have hurt domestic production. The state is trying to overturn the ruling, saying it hurt Wyoming’s economy and violates the commerce clause of the U.S Constitution, which gives the federal government the right to regulate domestic and international trade.

Ambre’s North American operation eventually separated from the parent company and renamed itself Lighthouse Resources Inc.

“This is a ruling on the motion for summary determination, not a ruling on the merits,” Lighthouse general counsel Michael Klein told Oregon Public Broadcasting. “We look forward to addressing the merits of our appeal at the hearing scheduled for November.”

None of the six coal export projects proposed in the Northwest in the past six years has been approved, the station reported. They’ve all struggled with public opposition, permit denials and a declining market for the product.

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