Closure of the debt-ridden coal firm Solid Energy could mean the loss of up to 150 KiwiRail jobs, a union says.
The Rail and Maritime Transport Union said if the state run coal company folded it would also threaten the long-term viability of the TranzAlpine passenger service, which relies on freight to keep the lines maintained.
A digger loads up a truck at Solid Energy's Stockton Coal Mine (file) Photo: 123RF
KiwiRail said it was too early to discuss the long-term future of its West Coast rail operations due to the uncertainty around Solid Energy, but it was being kept informed of developments.
Solid Energy also said no decision had been taken.
The state coal company has told staff it has three options - a financial arrangement allowing it to stay afloat, a controlled sell-down, or liquidation.
KiwiRail transports coal from Ngakawau on the West Coast, through the Southern Alps to Lyttelton Port.
The line - known as the South Island Coal Route, or Midland Line - also carries shipments of Westland Dairy milk products from Hokitika to Christchurch and runs the TranzAlpine Service.
The union's general secretary, Wayne Butson, said in the past year the volume of coal had dropped to 1 million tonnes from 1.4 million tonnes and the line was carrying very little coal.
In addition, coal trains were experiencing significant delays because the Ngakawau plant was not able to load the trains as seamlessly as it had in the past, due to new rostering arrangements.
"We're getting train delays, mainly because the train timetable still isn't optimised perfectly for the new shift regime Solid Energy are running," he said.
However, in a statement, Solid Energy said they were continuing to meet their shipping plans and would like to hear from the union if there were difficulties.
"Each coal train carries approximately 1500 tonnes (30 wagons each carrying 50 tonnes of coal) so that one million tonnes a year is still 666 trains a year, or two a day," it said.
KiwiRail began talks with the union last week about cutting 14 jobs, but Mr Butson said if Solid Energy went under there would be further job losses.
"When you start cutting back on the jobs of rail workers you are talking about highly skilled workers that take a long period of time to acquire those skills ... a train driver's training is an absolute minimum to certification of around 18 months," he said.
Mr Buston said the position Solid Energy found itself in showed the Government was bereft of any sort of regional development strategy.
The decision on the proposal to cut 14 jobs - nine locomotive engineer and five rail operator or shunter positions - from the West Coast is due next month.
KiwiRail said it was discussing the likelihood of 10 West Coast job losses although there was the possibility of some affected staff being relocated to other South Island positions.