Hoosiers Seek Nod for Coal Spur

The Indianapolis-based regional Indiana Rail Road wants the Surface Transportation Board quickly to approve its plan to build a 5.2-mile link to a large new coal mine.

IRR is a 500-mile carrier that operates in both Indiana and Illinois. It said in a filing with the STB that if the agency will give its okay, this “shovel-ready” project can start construction in April.

The railroad first asked in October for the agency to consider the project as a spur track off its mainline at Dugger, Ind., and issue a declaratory order that would clear the carrier to build it quickly.

The idea was to run the track to a proposed coal mine that Peabody Energy was then planning, on land mostly owned by Peabody.

Earlier this month, Peabody said it had entered into long-term coal supply contracts that would allow it to open a Bear Run pit mine near Dugger to produce up to 8 million tons a year. Peabody said it will start that mine in this year’s second half, produce 2 to 3 million tons of coal in 2010 and ramp up from there.

Indiana Rail said it “urgently needs board action on its pending petition,” so it can have the extra rail connection ready early next year and be able to ship coal by rail to area utilities. Otherwise, the mine will use trucks to ship its coal.

One of the utilities that would take the Bear Run coal, Hoosier Energy Rural Electric Cooperative at Bloomington, also asked the STB to “act expeditiously and favorably” so the railroad can build soon. “The ability to move this coal via rail is the most cost effective,” Hoosier Energy said, “and avoids an increased number of trucks on the highways.”

Contact John D. Boyd at jboyd@joc.com.