Settlement reached over Seward coal facility dispute

The Alaska Railroad and Aurora Energy have agreed to an out-of-court settlement in a dispute involving a water permit. More than a year ago, a federal court sided with the Sierra Club and Alaska Community Action on Toxics in a suit against Aurora and the railroad, alleging that Aurora’s coal loading facility in Seward spilled coal into Resurrection Bay.

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Plaintiffs complained that Aurora was violating the Clean Water Act, because the coal-loading company’s general stormwater permit did not allow coal debris to be dropped into the water.

Aurora and the railroad had petitioned the U.S. Supreme Court this year to hear an appeal of the lower court’s decision, but the high court refused.

Late Tuesday, all parties involved in the 6-year-old lawsuit agreed to a settlement.

The settlement requires the railroad and Aurora Energy to make improvements to the Seward coal-loading facility and pay $10,000 to the Kachemak Land Trust for an environmental project

Bill O’Leary, CEO of Alaska Railroad, says the railroad has invested over a million dollars in improvements to the Seward facility over the years, and is committed to environmental stewardship in it’s operations. He says the $10,000 is not a fine. O’Leary says he’s looking forward to future export operations in Seward under an anticipated new permit.

Speaking for Aurora Energy, Lorali Simon says that the facility has been operating legally under a state of Alaska compliance order, while awaiting further permitting. Aurora applied for a different type of permit regulating spilled coal early this year. Simon says the settlement does not change operations at the Seward facility.

The original lawsuit was filed in December 2009. The settlement essentially closes the door on further court action.