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Colombia seeks to ship coal via Caribbean ports after Venezuela border crisis

The Colombian government is studying the possibility of permanently shipping coal from its Norte de Santander mines, usually shipped through Venezuela, via its Caribbean ports of Santa Marta and Barranquilla instead, the Colombian transport ministry said Sunday.

This comes after Venezuelan president Nicolas Maduro closed a key stretch of the country's border with Colombia indefinitely from August 20 after a skirmish between smugglers and the Venezuelan army.

The Colombian transport ministry met with coal miners who ship their fuel through Venezuela on Sunday to discuss alternatives and agreed to issue a document Tuesday outlining the logistics available to export coal within Colombia.

Among the solutions is to transport the coal by truck and rail to the ports of Barranquilla and Santa Marta, in addition to using barges to carry it on the Magdalena River to the Caribbean ports.

"We are building solutions in the logistics chain to export coal through the Atlantic Coast. In today's meeting in Barranquilla it was made clear that the ports in this city and in Santa Marta have enough capacity to meet the market and to export coal from the Norte de Santander," transport minister Natalia Abello Vives said, adding that the intermodal alternatives will be profitable as long as transport costs do not outweigh international coal prices.

One of the options the ministry is seeking is to ship between 500,000-600,000 mt/year of coal on the river through the port of Gamarra in the Cesar region to the Port of Barranquilla.

To make this possible, by Tuesday about 600,000 cubic meters of earth will have been dredged to make barge transport possible in the short term.

"Now we are also building an additional solution through the rail and road system so that on Wednesday September 2, in the city of Cucuta, the exporters have the pathways and costs to serve this market in a sustained manner in Colombia," the minister said.

The border closure has shut in as much as 35,000 mt of Colombian coal from being exported through Venezuelan ports as of Friday and there are currently as much as 200,000 mt of coal stocks in the Norte de Santander available for shipping, according to data from the Colombian transport ministry.

The Caribbean ports in question will be the 7 million mt/year capacity Carbosan coal terminal in the Port of Santa Marta and the RiverPort and Compass in Barranquilla.

The Port of Barranquilla is currently upgrading its infrastructure to meet environmental regulations in order to export coal.

The Norte de Santander region produced 1.094 million mt of coal in the first half of 2015, 5% lower from the same period last year, according to data from the Colombian national mining agency (ANM).

source: http://www.platts.com