Coal trains fewer but railroads keep rolling

Michael Virtanen
Associated Press

Matoaka, W.Va. — The red caboose parked at the edge of a rundown commercial block is the only rail car some people have seen in Matoaka in more than a year.

It bears the markings of the Norfolk and Western Railway, a company merged years ago and absorbed into oblivion, like Amoco and Oldsmobile. It has come to rest here, a relic of the past.

As the coal industry has fallen on lean times, so too have the businesses that supplied the mines, equipped miners and hauled coal out of the West Virginia mountains — none more visible than the trains that once thundered around the clock along the shoulders of these hills.

Now, with a coal operator in the governor’s office and an outspoken advocate for coal in the White House, many are watching for signs of life from a business that once represented the living embodiment of an industry on the move. The major railroads here, Norfolk Southern and CSX, each formed from decades of mergers, have continued to post profits while shedding personnel, idling equipment and cutting overhead. And lately they’re expressing measured optimism about what lies ahead.

“The fact of the matter still remains that coal is a prominent source of energy in the United States and there’s still a need to haul that coal through rail transport, and we are going to continue to provide that,” Norfolk Southern’s David Pidgeon said. “At the same time, railroads have to be nimble. They have to adjust to an evolving marketplace, and so we have to diversify what we haul.”

Last year, the Norfolk, Virginia-based carrier leased 179 miles of West Virginia track to Kanawha River Railroad. It also began using the state’s new intermodal terminal near Huntington for other freight.

In Matoaka, a town of 227 people according to the 2010 U.S. Census, fully loaded coal trains used to rumble through every few hours and at least once at night.

“They used to come through a lot,” Carla Oakley said recently, standing outside her house.

The town once had a passenger station, though passenger service ended in 1953. Regular coal trains stopped running here in October 2015.

West Virginia coal production dropped from 132 million tons in 2012 to 88 million last year, according to industry data. But the U.S. Energy Information Administration has predicted domestic coal production will rise 3 percent this year, following an 18 percent drop last year. Coal still accounts for roughly 30 percent of U.S. power generation.

CSX and Norfolk Southern, West Virginia’s remaining Class I railroads, still operate across much of the state. West Virginia’s rail plan showed them using 2,100 miles of track four years ago.

Norfolk Southern currently has about 33 of its 800 miles of track idled. CSX declined to say how much track is idle but says it hasn’t made any major changes this year.

The state’s 2013 rail plan cited freight trains carrying more than 115 million tons on almost 1.1 million cars, 88 percent coal. Tonnage was down 28 percent from a dozen years earlier as Appalachian coal lost ground to western and foreign mines and other fuels.

Norfolk Southern combined coal routes under a single division last year. CSX closed administrative offices in Huntington. The company still operates rail yards in Charleston, Logan, Parkersburg and Huntington.

CSX posted net earnings of $1.7 billion last year. It said a nearly $470 million decline in coal revenue was offset by productivity savings. Its first-quarter 2017 report showed coal volume up 2 percent from a year earlier.

Norfolk Southern reported nearly $1.7 billion in net income last year with $250 million in productivity savings, and coal revenues of $1.5 billion, down 18 percent. Its first quarter showed coal volume up 3 percent.