Lyttelton promised more coal volumes

By PAM GRAHAM

Toll NZ and Solid Energy are close to agreement on a new contract for coal haulage to the Port of Lyttelton, ending an impasse between the rail operator and one of its biggest customers.

When posting a 3 per cent increase in annual profit yesterday, the port said it had assurances of increased coal volumes from Solid Energy and Toll NZ.

The coal miner and rail operator have been at loggerheads after only 2.1 million tonnes of the 2.4 million tonnes of coal ordered was carried to the port last year.

The present contract has five years to run but Solid Energy said progress had been made on a new contract.

Solid Energy chief operating officer Barry Bragg said the new contract would be a long one and "will hopefully enable us to do more business in the future".

Trains have been slow because of poor maintenance of the track and bridges. The coal route between the West Coast and the port is to get at least $25 million of the $200 million the Government is investing in the repurchased rail network during the next four years.

The state-owned coal miner has plenty of coal and plenty of customers but bad transport connections and has said $25 million is not a big enough fix. The route is used for exports but domestic demand is increasing as gas runs out.

Solid Energy expects to barge up to 80,000 tonnes of coal to the port next year because rail will not be able to handle all of the 2.5 million tonnes it wants moved. There were three trial barges from Westport to the port in May and June.

The company is also considering building ships to take coal to the North Island and Australia. It already barges coal to Onehunga and Australia.

The Port of Lyttelton earned $12 million in the year to June 30, just beating last year's figure of $11.63 million.

Total volume handled rose 4 per cent even with the below-forecast coal haulage. Revenue rose to $61.8 million from $60.9 million. The port is paying a final dividend of 7.25c a share.