June 2, 2015 / 9:21 PM / in 4 years

UPDATE 1-Colombia court further restricts use of main coal railway

(Adds official confirmation, mining minister comment)

BOGOTA, June 2 (Reuters) - Colombia’s Constitutional Court has extended a restriction on the overnight use of the country’s main coal railway, Fenoco, and has partially suspended construction work on an adjacent track for three months, it said on Tuesday.

After imposing a ban in February on trains crossing the town of Bosconia in Cesar province for a six-hour overnight period, the court has extended the restriction to three municipalities in neighboring Magdalena province.

The Fenoco railway is jointly owned by three major coal miners, U.S.-based Drummond Co, Glencore unit Prodeco and Goldman Sachs’ Colombia miner CNR.

Ruling on a complaint by communities in three Magdalena municipalities of noise pollution, the court has also suspended work in Magdalena on construction of a second, adjacent track for a three-month period, the newspaper said.

The work is suspended while the court investigates whether the construction was undertaken without prior consultation with the community. Doubling the track is intended to increase logistics capacity in the world’s fourth-biggest coal exporter.

Mines and Energy Minister Tomas Gonzalez said the decision was “very grave” for the sector, which is an important source of taxes and royalties for the government, even more so since the price of its top export, crude oil, plunged in the second half of last year.

“Community rights in terms of noise and the environment do not need to clash with the development that coal brings. There are ways to make them compatible,” he said.

It was not immediately clear what impact the extension of the restrictions would have on the movement of coal and Fenoco representatives could not immediately be reached for comment.

The six-hour daily restriction has cut the railway’s capacity by one quarter, its owners say, and prompted the government last month to lower its estimate for coal output in 2015. (Reporting by Peter Murphy; editing by Robert Birsel and G Crosse)

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