Opponents of coal railroad call on feds to deny permit

By Matthew Brown, Associated Press

A group of conservationists and ranchers asked federal transportation officials to deny a permit for a long-delayed $400 million railroad that would serve a proposed coal mine.

BILLINGS, Mont. (AP) — A group of conservationists and ranchers asked federal transportation officials on Friday to deny a permit for a long-delayed $400 million railroad that would serve a proposed coal mine near the Montana-Wyoming border.

The Tongue River Railroad was first proposed more than three decades ago and would open up southeastern Montana's huge coal fields to new mining.

But after its sponsors last month sought to suspend the railroad's permit application — citing a weak coal market and delays in the proposed Otter Creek mine near Ashland — opponents want the Surface Transportation Board to kill the project.

"They've been buying time for 30 years and it's time to say enough is enough," said Clint McRae, whose Rocker Six Cattle Co. near Colstrip sits in the proposed path of the 42-mile line. "We've got fence projects on hold, livestock watering pipeline projects that have been on hold because we don't know where it's going."

Attorneys for Rocker Six and the Northern Plains Resource Council asked the transportation board to deny the railroad's most recent application, submitted in 2012.

It's the fourth application to be submitted for the railroad. Three prior applications involving different routes for the line were approved over the decades, only to have the plans abandoned or changed.

The railroad is jointly owned by Arch Coal, BNSF Railway and TRRC Financing. On Nov. 25, the railroad asked the Surface Transportation Board to suspend its permit application indefinitely, pointing to delays in the approval of Otter Creek.

Railroad spokesman Matt Jones with BNSF said it had not yet had a chance to review Friday's request to deny its application. But Jones said there was "strong justification" to grant the suspension given the "extended permitting process for the Otter Creek Mine."

Beginning in 2009, St. Louis-based Arch paid $160 million to the state of Montana and Houston-based Great Northern Properties for leases at Otter Creek. Those gave it rights to an estimated 1.4 billion tons of coal and company executives once hoped to begin mining at the site by this year.

The Montana Department of Environmental Quality in March said it needed more information from the coal company to process its mining application.

Arch has said it expects to resubmit the application this month, but the company's growing financial troubles loom large over the project.

Arch posted a $2 billion loss in the third quarter of 2015 and has said that bankruptcy is possible. On Thursday, the company was notified by the New York Stock Exchange that it could be removed from the exchange because Arch's market value has shrunk considerably as its share price has plummeted, from $19.30 a share in December 2014 to just 90-cents a share on Friday.

A company spokeswoman did not immediately return messages seeking comment.

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