(This article was originally published Wednesday.)
--Drummond's production and transportation of coal from mines to
the port unaffected
--Drummond's port license could be reinstated within a week
--Official says government should be the first notified in these
types of emergencies
By Dan Molinski
BOGOTA--Colombian environmental authorities on Wednesday yanked
Drummond Co.'s license to load and unload coal at its main port
after the company dumped nearly 1,900 metric tons of it into the
sea nearly a month ago.
A spokesman for Colombia's Environment Ministry said the
decision to pull Alabama-based Drummond's port license was taken by
the government's National Authority of Environmental Licenses. The
spokesman said all of Drummond's other operations, including
production and transportation of coal from the mines to the
Atlantic port, remain unaffected by the decision.
He also said the port license could be reinstated within a week
so long as Drummond meets certain criteria, which he didn't
specify.
Drummond Colombia, which is 80% owned by Drummond and 20% by
Japanese trading house Itochu Corp. (8001.TO, ITOCY), is accused of
dumping coal into the sea on or around Jan. 12 when boat captains
tried to prevent the barge from sinking. Environment Minister Juan
Gabriel Uribe told local media that while he realized the company
may have faced an emergency situation in which the captain may have
needed to act by dumping the coal, he said the company erred in not
notifying authorities about the incident for more than a week.
"In these types of emergencies, the first to be notified should
be the government," Mr. Uribe said.
A spokeswoman for Drummond in Colombia said the company had no
immediate comment. A woman reached by telephone at the press office
in Drummond's Birmingham headquarters also declined to comment.
Beyond the suspension of the license at the port, Drummond also
faces a possible fine over the incident. Some reports suggest the
fine could be around $1.5 million, but an Environment Ministry
official said any specific figure is pure speculation.
Drummond aims to produce more than 30 million metric tons in
Colombia this year after producing around 27 million in 2012. The
firm has been in Colombia since 1998, making it one of the first
major coal firms to enter Colombia, a country that now touts itself
as one of the top five coal exporters in the world. Royalties and
taxes from the coal industry have become a vital source of revenue
for the Colombian government.
Colombia's coal sector also includes companies such as BHP
Billiton Ltd. (BHP.AU, BHP), Glencore International PLC (GLEN.LN,
GLCNF) and Anglo American PLC (AAUKY, AAL.LN).
Write to Dan Molinski at dan.molinski@dowjones.com
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