New California law clouds Trump-backed Oakland coal export terminal project

The project is part of a broader Trump administration effort to support U.S. coal production and exports. In June, the administration announced $75 million for the Oakland terminal within a nearly $700 million coal-sector package, while the Energy Department has described the terminal as export infrastructure that could support Western coal producers and overseas demand.

The federal grant would cover only part of the investment. The Energy Department has estimated the facility’s cost at about $231 million, but a feasibility report prepared for a coalition of Utah counties put the likely cost in a much wider range of $430 million to $625 million. That same report estimated a 53-month construction and start-up schedule, a timetable that could put initial exports later than a previously projected 2028 opening.

Utah’s Rural Utah Infrastructure Coalition, representing eight counties, has asked the state’s Permanent Community Impact Fund Board to consider investing about $45 million in the project. The coalition sees a Pacific export outlet as important for accessing Asian buyers as domestic coal demand contracts and Western coal mines seek new markets. The board was expected to consider funding at an October meeting.

Potential export destinations cited in project-related reporting include Japan, South Korea, Taiwan, Vietnam and Malaysia. The facility could handle coal from Utah as well as Powder River Basin mines in Wyoming and Montana.

New environmental review requirement

Newsom’s signing of Assembly Bill 40 changes the project’s regulatory outlook. The law requires a California Environmental Quality Act review for new coal projects, or existing facilities proposing to export more than 5 million tons of coal annually. The threshold would cover the proposed West Gateway operation at its contemplated scale.

The legislation was sponsored by Assemblymember Mia Bonta, D-Alameda, amid concerns that the project’s likely operations differ substantially from earlier expectations. 

The terminal’s long legal history included Oakland’s 2016 ban on coal storage and handling, which developers challenged in federal court. A judge in 2018 ruled that the city could not apply the restriction to the planned terminal under its development agreement, and the California Supreme Court’s decision not to take up Oakland’s later appeal effectively cleared a major legal obstacle in 2025.

AB 40 does not necessarily block construction. But it could require a detailed assessment of the project’s environmental and health effects, consideration of alternatives and mitigation measures, and create another potential avenue for administrative and court challenges.

Open-storage disclosure heightens opposition

The newest controversy centers on the project’s proposed coal-handling design. A July report by Norda Stelo and Wood Mackenzie, prepared for potential Utah investors, said coal would be stored in two open-air bunkers holding roughly 150,000 tons each. That would depart from prior public assurances that the terminal would be fully enclosed.

The report also projected peak annual throughput at roughly three times the amount evaluated in the terminal’s older environmental documentation. That earlier review covered bulk commodities but did not specifically address coal, according to the Los Angeles Times.

Environmental justice advocates and nearby residents say open stockpiles, rail movements and vessel-loading operations could add coal dust and fine-particle pollution in West Oakland, an area already affected by port, trucking and industrial emissions. They have urged the Bay Area Air Quality Management District to require modern pollution-control measures and are preparing for further legal challenges.

Project supporters contend the terminal would create a long-sought mine-to-market route for coal-producing regions of Utah and Wyoming while supporting jobs and export activity. The Trump administration has said the project could create more than 1,400 jobs.

Read more articles by Stuart Chirls here.

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