Coal mine renews talks with Koreans

Posted: Monday, March 17, 2003

KENAI - Efforts are under way to help Usibelli Coal Mine regain a major long-term sales contract with South Korea's Hyundai Merchant Marine.

Loss of the contract last summer meant the Healy-based coal company reduced its work force by 30 percent. Jobs also were lost at the Alaska Railroad freight terminus in Seward.

Usibelli general manager Steve Denton said U.S. Sen. Ted Stevens, an Alaska Republican, has reopened doors to negotiations between Hyundai and Usibelli.

"Sen. Stevens made a trip to South Korea and told them how important he felt this business was," Denton said. "And he asked them to reconsider the termination of the contract. As a result, the (South) Koreans came back to the table."

Usibelli submitted a new proposal to Hyundai in December for a contract to deliver 400,000 tons per year. The new amount would be roughly one-third of the company's overall output and send one or two trains per week to Seward.

Denton said there still were no guarantees at this point, though.

Although Seward was affected, the impact on the Alaska Railroad was bigger.

"We took a pretty big hit," said railroad spokesman Patrick Flynn. "The majority of freight on the south end was coal."

Resuming the contract would mean more freight trains would travel with greater frequency to the Port of Seward, because having consistent traffic from the coal transport would justify winter maintenance on the rails.

"We do still have some freight customers in Seward," Flynn said. "But they generally don't have time-sensitive deliveries. So if there is a (snow) slide on the tracks, they can wait for a train to stop and return another day."

But Flynn said the railroad is cautiously optimistic, "but we're not banking on it."

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