Colombia, the world’s fourth biggest coal exporter, produced 23.2 million tonnes of the fuel in the first three months of the year, down 5 percent from the same period last year, the National Mining Agency (ANM) said on Friday.
The agency expects output for all of 2015 to be at least 87 million tonnes, down from an initial forecast of around 97 million tonnes due to a recent legal restriction halting overnight use of the country’s main coal railway that has cut capacity.
The ANM said production could be higher if the restriction on the Fenoco railway is resolved with engineering works being carried out by its owners, miners Drummond, Prodeco, a Glencore (Xetra: A1JAGV - news) subsidiary and CNR (Shanghai: 601299.SS - news) , a unit of Goldman Sachs (NYSE: GS-PB - news) .
The works involve construction of gabions, or barriers, to deaden noise from passing trains to address complaints of noise by residents of one town the line crosses. Works began last month and are expected to take a month more to finish.
The reopening of the line will depend on the approval of inspectors at the environmental regulator ANLA and a regional court in Cesar province where the residents’ complaint was made.
A decrease in coal output this year comes at a bad time for Colombia.
The plunge in the price of crude oil, its top export, has left the government with less revenue to fund infrastructure investment as well as ongoing peace initiatives.
The country’s gold production in the first quarter totaled 271,848 troy ounces and silver was 50,309 troy ounces, the ANM said.
Coal prices in Europe, where most of Colombia’s coal is now exported for power generation, were around $56.70 per tonne this week for 2016 delivery. (Reporting by Peter Murphy; editing by Leslie Adler and G Crosse)