The Multinational Monitor


T H E   E L E M E N T S

Taiwan-Canada Coal Trade

by James Ridgeway

Taiwan is the latest Asian nation to join the rush for coal. Entering into a large coal venture with the Canadians, Taiwan Power Co., which already "imports two million tons of coal a year from Australia and South Africa, recently signed an agreement for a U.S.$100 million thermal coal project at Bowron River, 30 miles east of Prince George in British Columbia.

Proven reserves there are estimated at 40 million tons, with a total indicated resource base of 67 million tons. Taiwan has agreed to gobble up the whole of the mine's projected output of 1.2 million tons for 25 years. Bowron River will be the first thermal coal project in the history of British Columbia.

Australian coal was once the choice for Taiwan, due to the lower costs of ocean freightage, but the rising production costs down under have caused the Australian product to lose its competitive edge.

British Columbia and Alberta are the two main coal-producing provinces in Canada with openings to the Asian market. Alberta's truly immense coal reserves are an extension of the vast Fort Union Formation which occurs in eastern Montana and parts of Wyoming.

British Columbia is also well endowed, containing 60 percent of the total Canadian reserves of metallurgical coal and about 10 percent of its thermal coal. In 1979, coal output accounted for about 39 percent of the province's mineral revenues.

Strategic metals (titanium, cobalt, chromium, etc.) are fast becoming what oil was in the early 1970s for the U.S. government. Both Air Force and Navy, along with the mining industry, are anxious to establish domestic production in strategics where possible. And where domestic production is not possible (as in the case of cobalt) they want secure sea lanes for export from safe mining enclaves.

What this means is a heightened concern over policy toward South Africa, where the U.S. acquires large quantities of chromium and manganese; increased access to Australia, a vast storehouse of precious and strategic minerals; and government subsidy for deep-sea mining operations.

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