By Zack Hale
April 29, 2018 - Despite a growing tangle of litigation, backers of Millennium Bulk Terminals’ $680 million coal terminal in Longview, Washington are still optimistic that the project eventually will get built.
In fact, the parent company behind the terminal is pursuing a new strategy to circumvent state regulation and force the project through.
The bold new effort comes after a 17-month string of losses dealt by decisio- makers dating back to January 2017.
That’s when the state denied an aquatic lease for the coal dock. Nine months later, Millennium’s application for a state water quality permit was denied. Most recently, the state Shoreline Hearings Board dismissed Millennium’s appeal of two additional key permit denials.
Seven years after the project was first proposed, the battle to build what would be North America’s largest coal export terminal is now proceeding on a dizzying number of fronts, including a federal lawsuit against Gov. Jay Inslee.
The project’s future seems so precarious that county officials earlier this month briefly proposed abandoning a study on the project’s long-term health impacts, although the study is now proceeding.
Nevertheless, Millennium’s leaders remain confident they will prevail in a series of state-level legal challenges.
“We were always planning on a legal battle,” Millennium President and CEO Bill Chapman said in an interview Friday. Prior to leading Millennium, Chapman spent nearly 30 years advising corporations and municipalities in permitting and environmental compliance matters.
Legal fees represent “an expensive drop in the bucket” compared to what the company has spent so far, he said.
Kirsten Boyles, an Earthjustice attorney representing a coalition of environmental groups opposing the project, said the company shows no signs of giving up.
“I think they’ve been on life support, but they don’t show any signs of pulling the plug,” she said in an interview Friday.
The project still has strong support from investors, said Wendy Hutchinson, Millennium’s vice president of government and public affairs. The company has already invested $25 million in site cleanup and another $15 million in the environmental review.
While the price of solar and wind energy has plummeted recently, Hutchinson noted that U.S. coal exports still grew by 61 percent last year. Exports to Asia more than doubled from 16 million short tons in 2016 to 33 million short tons in 2017, according to U.S. Energy Information Administration.
At full buildout, the Millennium terminal would export about 44 million short tons of coal annually to Asian markets.
“You’ve got to remember how investors think, and it’s a question of whether there’s a good business case for the project,” Hutchinson said in an interview Friday.
She also noted that the coal terminal is the only major project of its kind with a completed environmental review.
The old Reynolds Metals aluminum site in Longview — where railway meets a deepwater port — still represents the best option for a company seeking to establish a major new West Coast export facility to move coal shipments from mines in Wyoming and Montana.
In a new strategy, Millennium’s parent company, Lighthouse Resources, reportedly is attempting to use a renegotiated North American Free Trade Agreement as a vehicle to navigate around state regulators’ denial of Millennium’s permit applications.
S&P Global Capital, a market intelligence company, reported on March 28 that Lighthouse is pushing the Trump administration to use NAFTA renegotiations to bypass state agencies.
“Lighthouse Resources Inc. is looking at all reasonable solutions to the impasse created by Washington state officials’ to fairly consider (Millennium’s) permit applications,” Michael Klein, vice president of legal and business development and general counsel of Lighthouse, told the publication. “One possible legislative solution that has been proposed would involve NAFTA.”
It’s unclear how the deal would be specifically tweaked for Millennium. The ongoing trade negotiations have not been subject to public view so far.
“It’s hard to know with precision because the talks have been happening behind closed doors, with the public shut out and corporations invited in,” Ben Beachy, director of the Sierra Club’s responsible trade program, said in an interview Friday.
But a recent letter to Trump by U.S. Sens. Ted Cruz (R-Texas), Cory Gardner (R-Colo.) and Steve Daines (R-Mont.) calls for a “competitiveness” chapter that could somehow apply to the project.
A new NAFTA deal should establish “a streamlined, coordinated permitting system that expedites infrastructure and manufacturing projects, doesn’t keep companies in endless limbo awaiting politicized determinations, and unleashes exports,” the letter reads.
Under the president’s fast-track trade authority, the Senate could also avoid a filibuster by ratifying a new trade deal with a simple 50-vote majority, the letter noted.
Past trade agreements have already made some major energy projects difficult to challenge. For example, the last NAFTA deal removed a slew of potential barriers to gas pipeline projects serving Mexico.
Beachy noted that a subcommittee on energy for the latest round of NAFTA negotiations is made up entirely of corporate representatives.
“We just don’t think corporate polluters should be writing our trade deals,” he said.
Chapman, Millennium’s president and CEO, said he has not had any discussions with federal officials regarding NAFTA.
But “there’s clearly a pattern of state interference with federal, interstate and foreign commerce, and that’s exactly what the Constitution prohibits,” he said.
Critics say a special deal for Millennium as part of secret trade negotiations would represent a dangerous attempt to dodge environmental protections at a time when biodiversity is plummeting and global temperatures are rising.
“Washington state went through a thorough, comprehensive review of this project and found that the increased rates of cancer and threats to our clean air and water weren’t worth it,” Jasmine Zimmer-Stucky, co-director of the Power Past Coal coalition, said in a statement to The Daily News. “It’s outrageous for the coal industry to strike a backroom deal with the Trump administration to try to do an end-run around state law and force through this dirty project over local opposition.”
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