A federal board has sided with one of the largest coal producers in the United States in a contract dispute with a major freight railroad, ordering BNSF Railway to transport at least 4.2 million tons of coal this year for overseas use.
The U.S. Surface Transportation Board’s 3-2 order last week said BNSF has the ability to fulfill the contract and still meet the needs of other shippers.
The Navajo Transitional Energy Co. sought the order in April. The company had filed a lawsuit late last year saying that major shortcomings in BNSF service cost it $150 million in lost revenue this year and another $15 million in charges when coal wasn’t loaded in a timely manner onto ships destined for Japan and Korea.
The transportation board said NTEC was highly likely to succeed on the merits of its claim.
“The common carrier obligation is a core tenet of the Board’s regulation of the freight railroad industry and is a pillar of the railroads’ responsibility to our country’s economy,” Chairman Martin Oberman said in a statement Friday.