Thursday, January 31, 2013

Colombia eyes major new coal railroad

Written by  Luther S. Miller, Senior Consulting Editor

New Colombia Resources, Inc. announced in Coral Springs, Fla., Thursday its plans for a public-private partnership with the Agencia Nacional de Infraestructura (ANI) of Colombia to build a $359 million railroad to move high-quality metallurgical coal from central Colombia to export terminals on the northern coast.

The company said it is in talks with consultants to develop a pre-feasibility study to submit to the ANI. Once this study is approved by the ANI, New Colombia Resources and its partners will own the project and commence the feasibility study. Once the feasibility study is approved, the consortium will be granted a 30-year railroad concession.

"An ownership stake in a railroad should significantly increase our profit margins," stated John Campo, President of New Colombia Resources, Inc.

"Since the Free Trade Agreement (FTA) with Colombia was approved by the United States," the announcement noted, "commerce between Colombia and the U.S. has increased creating a need for more infrastructure projects to move cargo.

"Central Colombia has some of the highest quality coal reserves in the world; our job is to not only get it out of the ground, but move it to the export terminals. One of the biggest problems coal companies face in Colombia is getting coal to the ports, producers in the region are trucking coal to the ports at a profit. We have identified several large multinational companies that are exploring in our area that would benefit from this railroad." stated Campo.

With regards to the Free Trade Agreement, the mining industry is optimistic about wielding Congress and the courts this year to push an agenda focused on expanding mining on federal lands and coal export capacity, as well as fighting EPA's greenhouse gas regulations. "There's not one corner of the Congress where we don't have strong friends," said Rich Nolan, the National Mining Association's senior vice president for government affairs.