The U.S. Surface Transportation Board (STB) has killed the future of the planned 42-mile-long Tongue River Railroad, citing the uncertainty of permitting, costs and a continued weak coal market. The unanimous STB decision was made public on April 26. The application for the line, which had a price tag of $405 million, was suspended by its backers—Arch Coal, BNSF and TRRC Financing—late last year. The origination and service point for Tongue River, which was first proposed more than 30 years ago, would have been Arch Coal’s planned Otter Creek operation. Arch filed for Chapter 11 bankruptcy and subsequently shelved its plans for Otter Creek last month.
Planning had first gotten into high gear in 2010, when Arch inked a development rights deal with Montana for $85.84 million that gave it 14 state-owned coal parcels in the Otter Creek Valley. At that time, it was eyeing 2016 for full production of the mine. An Associated Press report said the STB has killed opposition from landowners in Montana seeking a permanent block to keep the railroad from submitting another permit later.