Railroad Puts $6 Billion Coal Plan on Hold

The Dakota Minnesota & Eastern Railroad Corp. said Wednesday its $6 billion plan to ship Wyoming coal across South Dakota and Minnesota has been put on hold because of the poor economy.

In court papers filed in U.S. District Court in Cheyenne, DM&E also said it has dropped its condemnation lawsuits against some landowners in northeastern Wyoming.

The railroad filed the lawsuits in 2007 seeking condemnation of some 19 landowners in Converse, Weston, Campbell and Niobrara counties for rights of way to about 1,200 linear acres.

DM&E is based in Sioux Falls, S.D., and is owned by Canadian Pacific Railway. It has been working for years to expand and improve its tracks so it can ship coal from northeast Wyoming's Powder River Basin to power plants elsewhere.

"Due to significant changes in the economic climate, DM&E cannot say that there is a reasonable probability that it will proceed with its Powder River Basin project in the near term," the company's notice of dismal said.

Some landowners resisted DM&E's plans, prompting the lawsuits.

In Wyoming, the corporation filed lawsuits seeking condemnation of some 19 landowners in Converse, Weston, Campbell and Niobrara counties for rights of way.

But in Wednesday's filing, it indicated that certain conditions needed to carry out its plan — such as a favorable regulatory climate, available financing and acquisition of land rights — have failed to develop.

"The country has seen a record economic downturn altering the strategic growth plans of nearly every industry in the country," DM&E attorneys wrote. "This has resulted in a longer timeframe for commencement of the project than anticipated at the time these condemnation actions were filed."

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Information from: Casper Star-Tribune - Casper, http://www.trib.com

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