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Colombia’s second largest coal producer has been ordered by a regional environmental body to stop loading coal.
The Regional Autonomous Corporation of Magdalena (Corpamag) has told US-based Drummond to immediately cease loading work because the company is not in compliance with new rules which require miners to implement a direct-to-vessel loading system, Reuters reports.
Producers were required to complete the upgrades by January 1, 2014. But not even two months ago the government had said it was looking at ways to extend this deadline.
Drummond had said that it would be unable to meet the deadline and that without an extension it might have to halt one-third of the country’s exports.
And indeed the company reached a deal with the government last month whereby Drummond would continue loading with barges and cranes until March but would pay a daily fee to do so.
It’s unclear whether the regional body’s order can override the deal with the government.
A Drummond worker told Reuters by phone that the site was still operating normally.
Coal shipments account for 12% of Colombia’s coal exports – second only to oil. The outcome of this issue will could weigh heavily on Colombia’s already troubled coal market; 2013 exports most likely did not meet targets.
A director of the country’s Ministry of Mines and Energy told reporters in November that he was “extremely worried” about the situation with Drummond.
The government introduced the direct-to-vessel coal loading law in 2007. The initial deadline for compliance was 2010.
As reported by Platts, Colombia’s vice minister said in November that Drummond’s upgrades were “very delayed.”
