NCTA Revives Waterborne Transportation Committee Amid Challenging Times on the Mississippi

By Scott Becnel, Director of Energy Sales & Business Development, Cooper Consolidated LLC

These are indeed challenging times that our nation faces, as we grapple with how best to contain the COVID-19 pandemic while simultaneously maintaining and expanding life-sustaining industry, trade, and commerce. The two goals could be seen as incompatible—absent careful planning and adherence to a sound course of action on both fronts. It is with this is as background that NCTA

Executive Director John Ward approached me to chair the recently reactivated Waterborne Transportation Committee.

Coal traffic on the U.S. inland waterways system was already dropping before the pandemic hit—which slowed industrial activity, decreased electricity consumption, and compounded the challenges for both those who produce coal and those who transport it. And while the ongoing declines in domestic coal-fueled electricity generation mean that a return to the volumes of waterborne coal shipments of yesteryear is unlikely, I see a potential boost in metallurgical and thermal coal exports that could help offset much of the expected future declines in domestic consumption.

NCTA’s Waterborne Transportation Committee was formed in 2015 to focus on the coal industry’s unique logistical, regulatory, and infrastructural needs—and those needs have only grown more pronounced in the intervening years. The Committee’s purview includes all segments of the coal transportation market, including the Great Lakes and inland waterways, locks and dams, rail-to-water logistics, export terminals, ocean shipping, and the regulatory challenges related to all of these areas. In light of the challenges and changes associated with coal transportation in today’s environment, the Committee sees a growing role for itself in facilitating solutions to issues that impact producers, shippers, and service providers alike. The Inland Waterways System Sometimes referred to as the “backbone of the transportation logistics system,” the inland waterways comprise 12,000 miles of interconnected navigable water channels and 218 locks that are integral to the nation’s supply chains 1 —not the least of them, coal. According to American Waterways Operators, over 100 million tons of coal was transported on U.S. waterways last year alone for both domestic consumption and export— the vast majority of which was moved by barge. 2 Currently, approximately 18,000 dry cargo barges operate throughout the system—roughly 70 percent of which are covered and 30 percent of which are open hopper barges. And while railroads move a much greater volume of coal throughout the U.S., barges move coal far more efficiently and cost-effectively. One standard 15-barge tow can move the equivalent of 216 railcars or 1,050 trucks. 3 Moreover, compared to barges, moving an identical amount of cargo by rail generates 30 percent more emissions, while trucks generate 1,000 percent more emissions per ton-mile of cargo moved. 4 Clearly, the availability of efficient transport by barge is of vital importance to the competitive position of U.S. coal— compared both to other fuels for domestic consumption and to overseas coal sources for export markets. And yet the U.S. barge infrastructure is aging, with more than one-third of barges over 20 years old and nearing the end of their expected life. What’s more, new hopper barge construction over the past several years has been significantly below historical averages—at least in part a reflection of the reduced tonnage of coal moving over the inland waterways in recent years.

Aging Waterways Infrastructure The aging infrastructure of the inland waterways that our barges navigate, particularly its locks and dam structures, represents another challenge that will require substantial investment in the coming years. More than half of all U.S. locks and dams now in operation were built in the 1930s and are well past their projected 50-year design lives. 5 Too often in recent years, that has translated into malfunctions, delayed shipments, and an added cost of doing business.

Severe flooding on the inland waterways in 2019 and early 2020 has exposed further challenges to cargo traffic that require urgent and ongoing attention. Persistent high water on the Lower Mississippi River in recent months has caused silt to fill in at the draft at Southwest Pass (the river’s deep draft channel), forcing reduced tonnages per vessel and, again,

“These draft improvements, once completed, will help lower the costs of all products shipped via larger oceangoing vessels and will help improve the economics to deliver coal tons to the Far East.”

–Scott Becnel

higher shipping costs. Dredging and other channel improvements have to be carried out in a timelier manner to avoid river closures and stoppage of services that severely impacts barge companies, shippers, and terminals.

There is some good news on the horizon. Recent legislation has approved the deepening of the channels for the Port of New Orleans and Alabama (Mobile). The new drafts increase from 45’ to 50’ and will match the new Panama Canal draft of 50’. These draft improvements, once completed, will help lower the costs of all products shipped via larger oceangoing vessels and will help improve the economics to deliver coal tons to the Far East. On July 31, Louisiana state officials joined the U.S. Army Corps of Engineers in authorizing and signing an agreement for the deepening of the Mississippi River from the Gulf of Mexico through Baton Rouge.

The importance of upkeep and improvement of the inland waterways

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obviously goes well beyond coal producers and transport companies. The Lower Mississippi River sees roughly 7,500 vessel calls per year at five deep-draft ports below Baton Rouge (mile 250) that import and export a collective 150 million tons of cargo annually. This combined five-port district is equivalent to the largest-tonnage port in the world—and the ports, waterways, and waterwaysdependent industries it supports generate over 100,000 jobs and $27.8 billion in total output. 6

Perhaps more astonishing is that the current coal-handling capacity for Gulf Coast terminal operators—landbased and mid-stream—is a whopping 110 million tons annually. It is the goal of the Waterborne Transportation Committee to work with all interested parties that have a vested interest in this infrastructure to ensure that that capacity is utilized to its utmost in the coming years. Those interested in helping the Committee shape and realize this vision should contact me at Scott.Becnel@ cooperconsolidated.com.

Scott Becnel is Director of Energy Sales & Business Development at Cooper Consolidated LLC—a balanced, asset-based provider of stevedoring, barge, marine, and logistics services. The company’s services span the entire reach of the Lower Mississippi River between Southwest Pass and Baton Rouge and are provided and directed by their own assets and employees, thereby giving customers the most reliable and flexible service achievable. Their specialties are innovative transfer technologies and seamless cargo movements.

Scott is a lifelong resident of Belle Chasse, Louisiana, a small town downriver of New Orleans along the banks of the “Mighty Mississippi.” Growing up alongside the river, Scott knew of the opportunities it provided and decided to attend Texas A&M University’s Maritime Campus in Galveston, where he received a Bachelor of Science degree in Maritime Administration in 1987. He has since spent his 33+-year career in various management and senior management roles for bulk terminals, logistics providers, and marine-related businesses on the Lower Mississippi River.

In addition to serving as the newly appointed chair of NCTA’s Waterborne Transportation Committee, Scott also serves as a Board Member for the American Coal Council, an Executive Committee Member for the International Dry Bulk Terminals Group, and served previously as a Board Member of the Louisiana International Gulf Transfer Terminal Authority.

Footnotes 1 National Waterways Foundation. Fact Sheet. “Economic Impact of Louisiana’s Inland Waterways.” 2019. 2 Carpenter, Jennifer. “Coal by Barge: The Operational and Policy Outlook.” Coal Transporter. Issue 2, 2020. p 12. 3 National Waterways Foundation. Fact Sheet. “Economic Impact of Louisiana’s Inland Waterways.” 2019. 4 Texas A&M Transportation Institute. A Modal Comparison of Domestic Freight Transportation Effects on the General Public: 2001–2014. January 2017. p A-1. 5 National Waterways Foundation. Fact Sheet. “Economic Impact of Louisiana’s Inland Waterways.” 2019. 6 Ibid.