CN developing supply chain for west coast thermal coal exports

EDMONTON and CALGARY: CN and Coalspur Mines Limited (Coalspur) have signed a memorandum of understanding (MOU) to develop a logistics supply chain to transport export thermal coal from Coalspur’s Vista Coal Project near Hinton, Alberta, to Western Canadian ports starting in 2015.

The MOU establishes the agreement’s framework, which will accommodate Coalspur’s plan to begin coal production in 2015 at a rate of roughly 2.5 million tonnes per year, rising to about 11.2 by 2019. CN will transport Vista production to west coast ports including Ridley Terminals Inc (RTI) at the Port of Prince Rupert, BC. Coalspur recently signed a throughput agreement with RTI to handle up to 8.5 tonnes of export coal at the terminal.

CN and Coalspur will design and build a rail siding at the Vista site capable of handling the loading of 175-car unit trains at a full capacity of gross weight on rail of 286,000 pounds per car. The two parties expect to negotiate a definitive transportation agreement in 2012.

“CN will work closely with Coalspur to build an efficient and effective logistics process for its export coal,” said Jean-Jacques Ruest, CN executive vice-president and chief marketing officer. “CN has developed a comprehensive, end-to-end supply chain strategy to manage coal flows from mines to west coast terminals. This approach, coupled with strong customer collaboration, will help Coalspur maximize sales opportunities in global markets.”