VANCOUVER, Aug. 8, 2014 /CNW/ - Westshore Terminals Investment Corporation (TSX: WTE) ("Westshore" or the "Corporation") today announced changes to throughput agreements with Coal Valley Resources, Inc. a subsidiary of Westmoreland Coal Company ("Westmoreland") and Cloud Peak Energy Logistics LLC, a subsidiary of Cloud Peak Energy Inc. ("Cloud Peak Energy").
The Corporation has agreed to accommodate both Westmoreland and Cloud Peak Energy by terminating its existing throughput agreement with Westmoreland as of December 31, 2014, and transfer the associated throughput capacity to Cloud Peak Energy commencing January 1, 2015. As both customers ship thermal coal through Westshore, there is no net increase in the contracted tonnage to handle thermal coal arising from this transaction.
As a result of the transaction Cloud Peak Energy expects to increase its 2015 Asian exports through Westshore to 6.0 - 6.5 million tons (or equivalent of 5.4 – 5.9 million tonnes) from 4.0 - 4.5 million tons (or equivalent of 3.6 - 4.1 million tonnes) currently forecast for 2014. The agreement with Cloud Peak Energy is effective until the end of 2024. Cloud Peak Energy's primary focused Asian export markets are South Korea, Japan and Taiwan. This transaction will also permit greater operating efficiencies for Westshore. This transaction will not be expected to result in any increase in the total number of trains arriving or departing from Westshore and will equate to one additional BNSF Railway train approximately every two days from current levels with a similar decrease of CN trains.
BNSF is in the process of completing a second re-spray facility in Washington State, to continue to improve dust control efforts, which would follow initial regular coal car spraying at the respective mine sites. This facility is expected to be operational by the end of 2014. This was a key consideration by Westshore in completing this transaction.
Westshore will remain basically fully booked for capacity through 2014, 2015 and into 2016 (with a rated capacity of 33 million tonnes per annum) until such time as the $275 million new equipment upgrades are installed and become operational, and which will result in modest capacity improvements at the terminal, anticipated to commence in 2017 through early 2019.
Forward-looking statements are based on information available at the time they are made, assumptions made by management, and management's good faith belief with respect to future events, and will be impacted by and are subject to the risks and uncertainties outlined in the Corporation's Annual Information Form that could cause actual performance or results to differ materially from those reflected in the forward-looking statements, historical results or current expectations.
SOURCE: Westshore Terminals Investment Corporation
For further information: Nick Desmarais, Secretary and Vice-President of Corporate Development, 604-488-5214