Tranz Rail billed for shortfall in transport capacity

An angry Solid Energy is barging coal from the West Coast to Lyttelton and sending the bill to Tranz Rail.

Solid Energy says Tranz Rail cannot provide enough capacity and there is no option but to barge the shortfall.

Tranz Rail would have to pay the "substantial" cost of shipping, as required in its contract, said Solid Energy chief executive Don Elder.

Solid Energy will barge 24,000 tonnes from Greymouth this month and may also barge from Westport. Barging would continue until Tranz Rail could meet the demand, Elder said.

"Each month for the last nine months, and probably longer than that, Tranz Rail has been unable to deliver from the West Coast to Lyttelton the volumes that we have had in our plan," Elder said.

"While they've been making efforts to do that, they've not been successful. Each month for the last four months have been 30 to 35 per cent under our requirements. That's left us with a critical shortfall of coal at Lyttelton."

Solid Energy and Tranz Rail had previously agreed on upgrades for rail transport, and Solid Energy had already paid for the construction of extra wagons, but Tranz Rail still could not measure up, he said.

Tranz Rail had promised it could meet Solid Energy's requirements for the coming month, but would have to provide 30-40 per cent more capacity than it had done so far.

"We require 190,000 or 200,000 tonnes a month for the next three months to catch up with our shortfall. The highest that's been achieved recently is 150,000 tonnes."

Tranz Rail's best haulage had been 160,000 tonnes a month early last year, Elder said. Solid Energy would not be barging if it thought Tranz Rail could fulfil its commitments.

Elder said Solid Energy had already postponed, rescheduled and reshuffled its international coal shipments from Lyttelton.

"We are dangerously close to having to cancel, but we don't want to do that."

Tranz Rail spokesman Alan McDonald said Tranz Rail had to cancel 27 trains since January because of washouts.

It remained to be seen whether Tranz Rail could fulfil its commitments in the coming month, but he acknowledged that improvements planned to the Midland line would not start until late this month or next month.

McDonald said Tranz Rail was putting in eight extra locomotive crews, spending up to $500,000 on lifting speed restrictions and another $2.5 million on loop extensions on the Midland line to allow longer trains.

He declined to confirm whether Tranz Rail would be paying for the barging. Contract details were confidential, he said.

- NZPA