Fuelling India's coal needs.

India wants to buy a bigger chunk of B.C.'s vast metallurgical coal reserves to feed its growing steel industry, a potential boost to the province's No. 1 export business, worth $5.7 billion a year.

A high-level delegation led by India's Steel Minister Beni Prasad Verma was in B.C. last week and met with Premier Christy Clark, International Trade Minister Teresa Wat and B.C. coal industry representatives.

The Indian government forecasts that by 2017 the country will need twice as much metallurgical coal. The additional 47 million tonnes of metallurgical coal India forecasts it'll need every year is more than B.C.'s entire annual production of 24 million tonnes.

However, British Columbia sits on vast coal reserves of an estimated 13 billion tonnes with several proposed metallurgical coal mines in the environmental assessment process. Karina Brino, president of the Mining Association of B.C., said the province's coal industry is paying close attention to the burgeoning Indian market.

"We know there is demand. Japan, China and India are certainly paying a lot of attention to British Columbia because of proximity to markets but also our stability, technology and our ability to do things responsibly," said Brino.

"Definitely this is not an opportunity that industry is going to pass on. And the more conversations and more we get to know each other on how do business and how to collaborate is something our members will be pursuing," she added.

There is already a battle over increasing coal exports through Port Metro Vancouver. Increased interest from countries such as India that lead to more production and overseas shipments is only likely to fuel concerns about coal's role in climate change.

Environmental groups and some Lower Mainland residents are raising concerns over coal's contribution to greenhouse gases (coal produces more carbon dioxide than natural gas and oil), and increased rail traffic, diesel emissions and coal dust.

While the protest has focused on U.S. thermal coal (used to produce electricity) that is exported through Vancouver, Voters Taking Action on Climate Change spokesman Kevin Washbrook said metallurgical coal used to make steel also produces greenhouse gases.

B.C. needs to be planning how to transition away from fossil fuels, including metallurgical coal, perhaps ensuring the steel is used to produce solar panels or even creating a domestic steel industry in B.C. and taking responsibility for the carbon emissions, said Washbrook.

"I don't see any coherent acknowledgment we are running out of time with climate change," he said.

There are nine metallurgical coal mines in British Columbia, and one thermal coal mine.

Teck Resources is the largest metallurgical coal producer with operations in southeastern B.C., but there are several metallurgical coal mines in northeastern B.C., including mines owned by Walter Energy and Anglo American.

There are several projects in development, including in northeastern B.C. by Xstrata, Cardero Resources and Colonial Coal. Teck is also reopening the Quintet mine in northeast B.C. Teck spokesman Chris Stannell said the company sees growth potential in India.

"As the Indian economy and middle class continues to grow, demand for products Teck produces, like copper, zinc and steelmaking coal, will grow in tandem," he said in an email.

The visit last week by the Indian delegation, which included a luncheon at Canada Place with members of the Indian business community, was not publicized by the B.C. government. However, that was an oversight by the newly-minted ministry, said Wat.

She said contact with the Indian delegation was initiated by B.C.'s trade office in India.

"We are definitely happy to export the coking coal to (India). And they want to invest, too," says Wat, B.C.'s first International Trade Minister. The portfolio was created by the premier after the Liberals' May election win.

Wat said no deals were signed during the visit, which included representatives from Rashtriya Ispat Nigam Ltd., India's state-run steelmaking and mining company.

But she said she believes the Indian delegation made good connections with industry.

Wat also signed a "letter of intent" with the Indian state-run steelmaking company to co-operate in areas such as investment, information exchange, timely regulatory processes and exchange of research and university students. A separate co-operation letter was signed by the University of B.C. and the Indian delegation.

Indian officials could not be reached for comment, but the India Times reported the Steel Ministry officials said they were interested in buying into B.C. coal companies as well as purchasing coal properties.

The fourth largest steel maker in the world behind China, Japan and the United States, India has set a target of increasing steel production 40 per cent to 110 million tonnes by the end of the decade.

Steel making production already grew more than 50 per cent between 2007 and 2011. British Columbia coal shipments (and solid fuels manufactured from coal) have already increased significantly to India, with a value of $161 million in 2012, which is up from zero only two years before, according to Statistics BC.

Still, shipments to India are well below those to British Columbia's leading coal export destinations: Japan at $1.55 billion in 2012, China at $1.39 billion and South Korea at $989 million.

Source : vancouversun.com