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Issue #584 | Breakbulk Quarterly

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2014 Media Kit
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Renewed gov’t scrutiny puts Drummond’s Colombia coal ops in doubt

By: | at 12:05 PM | Channel(s): International Trade  

Colombia mounted pressure on U.S.-based coal miner Drummond Co Inc on Wednesday as the company, the Latin American country’s No. 2 coal producer, continues the outlawed practice of loading ships by crane. The government was due to speak on the issue later in the day.

Environment Minister Luz Helena Sarmiento traveled to inspect Drummond’s port operations on the Atlantic Coast on Wednesday on the orders of President Juan Manuel Santos. She was scheduled to hold a press conference nearby at 2 p.m.(1900 GMT).

Several local news media reported that government was expected to announce that Drummond would be ordered to suspend loading coal, which would probably shut down most of its operations in the country.

A mining ministry statement on Wednesday suggested that Drummond’s coal-loading operations could be closed by the environment minister after her inspection in spite of arrangements the government made with the company last month.

“As the Mines and Energy Ministry, we back the development of mining activity ... but not at any price,” Mining Minister Amylkar Acosta said in the statement. “Before everything else comes environmental sustainability,” he said, acknowledging that royalties would be lost if Drummond’s loading was suspended.

Concerns about how Drummond would operate after a Jan. 1 ban on crane loading appeared to have been resolved in December when the government said it would impose a daily fine, enabling the company to continue the practice while it finishes building a legally-required conveyor belt system that cuts pollution.

But instead of the issue dying down and Drummond continuing crane loading until March when it expects to adhere to the new law, controversy over the U.S. company’s flouting of the rule has escalated, and Colombia’s government appears to be toughening its stance.

Corpamag, the regional environmental authority in Magdalena province where Drummond operates, announced it was suspending the company’s coal loading until it could do so in compliance with the law. But that decision is awaiting review by the environmental licensing agency, ANLA, before it can take effect.