Drummond vows to improve coal loading at its Colombian port

Thu Feb 7, 2013 2:28pm EST

Related Topics

* Government suspends coal loading at Drummond's port

* Colombia's coal sector suffers from series of problems

By Jack Kimball

BOGOTA, Feb 7 (Reuters) - Colombia's second-largest coal exporter, Drummond Ltd, vowed on Thursday to take "corrective" measures at its Caribbean port after a coal-loaded barge nearly sank in bad weather last month.

Colombia's environmental licensing body suspended loading at Drummond's port on Wednesday after an incident that local media said had spilt coal into the nearby waters in mid-January.

The company has not released any information on whether or not coal leaked into the sea.

In a statement on Thursday, Drummond said it "will proceed to suspend all coal loading activities for now and will work with the Colombian authorities to get our workers back to work as soon as possible."

It added: "Drummond Ltd. will take all corrective actions necessary to optimize the operation under the best environmental and safety standards, while it concludes the construction stage of its direct ship loading system for coal."

Drummond's port problems add to a possible strike at Colombia's top exporter, Cerrejon, and a payment dispute at a Goldman Sachs Group Inc affiliate, which in total could shut off nearly 85 percent of daily national coal production.

Prices for coal delivered into northwestern Europe moved up slightly on Thursday as did near-term swaps on concerns about supply from Colombia.

Colombia, the world's fourth-largest coal exporter, has seen an investment boom in oil and mining since a U.S.-backed security offensive began a decade ago, but environmental and social concerns are on the rise.

Drummond is an 80-20 joint venture with Japan's Itochu Corp.

The company expects coal output to rise to up to 31 million tonnes in 2013 from a lower-than-expected 26 million to 27 million tonnes last year, according to an interview published in local media in late 2012.

Colombia's coal industry is dominated by big thermal producers with their own port and rail facilities such as Glencore, Drummond and Cerrejon, which is owned equally by BHP Billiton, Anglo American and Xstrata.

FILED UNDER:
A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

Find your dream retirement town

Florida? Hawaii? Reuters has teamed up with Zillow to give you the power to customize a list of your best places to retire.  Video | Full Article