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Scheme to secretly expand Pacific Northwest export terminal part of plan’s undoing

Allegations of deception by the developer of a proposed coal export terminal in Longview, Washington date back to 2011, when Millennium Bulk Logistics was caught concealing the true scope of its plans from local residents and elected officials. The company had publicly stated that it intended to ship a modest 5.7 million tons per year from the Pacific Northwest port facility it wanted to build. But court records obtained by the New York Times showed the company secretly was planning to a massive expansion from its initial plan in a second phase that would ship allow the port to ship up to 80 million tons annually, 14 times more than the company originally stated in its application. 

Longview is the last of six coal export terminals proposed in the Pacific Northwest that still has any life life, although in early 2017, the Washington State Commissioner of Public Lands denied a key permit need for the project, citing “a chronic pattern of failure by the company to provide essential and accurate information” as a key reason. The company is challenging the permit denial and continues to pursue a plan to export up to 44 million tons of coal per year. That amount of coal would mean eight full coal trains per day moving through dozens of cities and towns along a 500-mile rail shipping route from the Powder River Basin in Wyoming and Montana. Concerns about toxic coal dust, noise, public safety and snarled traffic have drawn stiff opposition from residents, community leaders and elected officials in communities all along the rail line.

Sources:

– Portland Business Journal

– The (Longview, Washington) Daily News

– The New York Times

 

 

 

Coal mining executives charged with fraud for roles in Serbian scams

After more than a decades of shady financing deals, Serbian investigators in early 2011 opened a case against state-run Electric Power of Serbia related to its operation of Kolubara coal mine in west-central Serbia. An internal audit of the company’s books revealed serious irregularities by management that resulted in unnecessary expenditures benefitting private contractors. The investigation led to the arrest in late 2011 of 17 people, including Dragan Tomic, who had been director of the Kolubara mine, deputy director at EPS and also a member of the Kolubara legislative assembly.

The suspects, which included officials from the mining company and the private businesses that resold lignite from the mine or leased machinery to Kolubara, were accused of running up fraudulent costs equivalent to around $11 million (US). According to reports, Tomic allegedly paid the companies for unnecessary mining equipment and services, and the companies overcharged for the number of hours they worked. Some of the private businesses that were accused belonged to high-level management in Kolubara. In all, 28 people were finally charged in connection with the case.

In a related case, several other executives of Kolubara Mining and EPS were also arrested for their part in fraudulently profiting from resettlement funds. An EPS board member was paid €1.2 million by the company as compensation for his house in the village of Vreoci. He claimed his house needed to be moved to make way for a new strip mine even though it was in fact located far from the mining zone and wasn’t actually his residence.

Sources:

– Bankwatch here and here

Sham procurement leads to fraud charges, leaves Slovenians on the hook for millions

Forms of Corruption & Wrongdoing

In Bataan province in the Philippines, three new coal plants are planned in addition to two existing plants and two open coal storage facilities. Coal companies were allegedly behind intimidation of Gloria Capitan, leader of a community group in Bataan concerned about coal pollution and health impacts. Gloria was assassinated by masked gunmen.

Intimidation & Retaliation

Threats, harassment, violence or other scare tactics to influence behavior, such as to quiet a whistleblower or chill opposition

In a village on the outskirts of Yangon, Myanmar, it comes to light that a foreign coal plant company has been misleading villagers for months with promises of profit-sharing and pushing non-English speakers to sign forms in English saying they support the plant.

Deception & Fraud

Lying, faking, covering-up, cheating, or lack of transparency to gain an advantage or hide wrongdoing

A scheme by Brazilian company Odebrecht to vastly overcharge for construction of two new coal power plants and a coal terminal in the Dominican Republic is one ploy amid what appears to be a broader scandal behind the project, which is now being partly paid for by public funds in the DR.

Financial Schemes & Excess

Bid-rigging, skimming, over-billing, tax evasion, golden parachutes, and other tactics for profit – often at public expense

The South African government is supporting new coal mining and three new coal-fired power plants in the face of major economic, water use and pollution concerns. Top government leaders in South Africa are financially tied to the coal industry.

Conflict of Interest & Favoritism

The potentially corrupting influence of an official’s financial or personal interests – a clash between self-interest and public interest

That was a lot of money I was being paid, and I believed I was being paid it to give favors any time they were asked to be given.” – Kentucky mine inspector Kelly Shortridge, testifying about the bribes he was paid by a coal mine owner to ignore or delay violations for issues like water pollution.

Bribery & Influence-Peddling

Payments or other favors given to sway or reward a decision that may be illegal or unethical

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