January 14, 2014 / 1:35 AM / 4 years ago

Cerrejon's Colombia coal output slips 4.6 pct in "adverse" 2013

BOGOTA, Jan 13 (Reuters) - Coal miner Cerrejon’s Colombia coal production fell 4.6 percent in 2013 to 33 million tonnes from 34.6 million the previous year, the company said, citing difficult operating conditions that were felt throughout the sector during the year.

Cerrejon expects production and exports to rise in 2014 depending on coal prices, a goal that will be made easier with two years still to run on a pay deal reached with workers after a strike last February, lessening the chance of labor unrest.

“On top of a consistent fall in coal prices in the last three years, came the 32-day strike and an increasing number of terrorist attacks on the railway line,” Cerrejon said in a press release.

Colombia is the world’s fourth-biggest exporter of coal, mostly to European markets where it is consumed in power stations and the commodity is the country’s second-most valuable commodity export after oil.

Exports from Colombia’s biggest coal miner, some of which were taken from left-over stocks from the previous year, totaled a higher 33.5 million tonnes in 2013, 2 percent more than in 2012, a press release said.

Cerrejon is a joint venture between Anglo American Plc , BHP Billiton and Glencore Xstrata Plc with an integrated project in Colombia comprising of a mine in the northern province of La Guajira, its own railway and port.

The company said it will seek the necessary licenses required to expand its operations “as far as market conditions permit”.

As well as strike action, the company saw repeated disruption due to bomb attacks on its railway line which the military blamed on left-wing guerrillas who have been fighting a five-decade war against the government.

Those attacks caused little or no disruption to exports however and the company said an aggressive contingency plan enabled it to make up for the exports that did not take place during its strike.

Cerrejon has used the now-mandatory enclosed conveyor belt loading system to fill ships at its port since its project began, instead of the recently banned crane-and-barge method, helping it avoid a disruption to loading now faced by the country’s No. 2 miner, U.S.-based Drummond.

Drummond will be forced to shut down loading at its port at midnight on Monday as its conveyor belt is not yet ready. The government has forbidden it from continuing to load ships from barges, after the practise was outlawed on Jan. 1 to reduce pollution.

More on Drummond loading ban:

Cerrejon paid 1.16 trillion pesos or about $602 million to Colombia’s government in royalties during 2013, the statement said, and spent about $13 million on social projects in La Guajira.

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