As two coal-based mining projects begin to move ahead in British Columbia, an effort by the province and neighbouring Montana to work together on the environmental effects of mining has cooled off.

Nearly two years after the two jurisdictions began work on a way to deal with cross-border concerns over proposed resource developments, there is still no approved plan, and no formal talks are scheduled.

Meanwhile, a metallurgical coal mine and a potential $3-billion coal bed methane project are moving ahead, although both are at very early stages.

"We're at a little bit of an impasse, but we haven't given up," said John van Dongen, B.C. Minister of State for Intergovernmental Relations. "We're working on it."

Mike Volesky, natural resources adviser to Montana Governor Brian Schweitzer, wouldn't call it an impasse, but he confirmed there have been no formal talks since December, 2006. He was uncertain whether the dialogue could be restarted before the fall.

The problem is a philosophical difference over how to gather environmental baseline data in advance of development. British Columbia favours a relatively narrow project-by-project approach, while Montana wants a broader, comprehensive approach that also considers the cumulative effects of more than one project.

The two jurisdictions have been at loggerheads for several years over both mining and energy projects proposed for southeastern B.C., particularly those that might affect the Flathead River.

Cline Mining Corp. of Sudbury, Ont., hopes to develop a metallurgical coal mine, and BP Canada Energy Co. of Calgary hopes to explore and ultimately develop a coal bed methane project.

Although these projects are in the very early stages, Mr. Schweitzer, with the backing of Montana Senator Max Baucus and U.S. Secretary of State Condoleezza Rice, wants B.C. to impose a moratorium on resource development until sufficient baseline environmental data has been collected and large-scale environmental assessments have been completed. Ms. Rice has formally asked Ottawa to launch its own environmental review of these proposals.

The United States is concerned about potential effects on water quality in the Flathead River, which flows south from Canada alongside Montana's Glacier National Park. Environmentalists on both sides of the border want any resource development in the area ruled out.

That is not an option, Mr. van Dongen says. "We have a cordial and respectful relationship, but we have been up front with [Mr. Schweitzer]. We're not prepared to say no development."

Mr. Schweitzer, while challenging resource development in southeastern B.C., is pushing an ambitious, coal-based program in southeastern Montana, involving coal mines, coal-to-liquids plants, and coal-fired power generating plants.

"It's preposterous for Montana to presume to challenge B.C. on anything to do with mineral extraction and protection of the environment," said Kevin Krueger, B.C. Minister of State for Mining. "It seems to me that the Governor and the Senator, in order to get elected, constantly try to raise their profile by beating up on B.C. when they've got a whole lot to be accountable for."

Mr. Volesky concedes that Montana is indeed pushing coal-based development in other parts of the state, but points out that environmental values are significantly greater in the Rocky Mountains.

"The U.S. Flathead has some of the same resources as the Canadian Flathead, obviously, they don't stop at the border," he said. "That sort of development would never be considered on the U.S. side."

While Mr. van Dongen would not elaborate on the "impasse" in the B.C.-Montana talks, Mr. Volesky confirmed it revolves around a difference of opinion about how much environmental baseline data need to be collected before specific projects can be assessed. British Columbia, on the other hand, believes the work can be conducted in the course of reviewing a project application, Mr. van Dongen says.

The dispute threatens to impose significant delays on Cline's schedule for the Lodgepole project, which is now in the early stages of review at the B.C. Environmental Assessment Office. Cline chief executive officer Ken Bates is reluctant to talk about the cross-border spat and the impact on his coal mine proposal.

"I don't want us to get mired in controversy," he said. "We're just doing the permitting. This is bringing a mine in, it's not a show."

While the Cline proposal got the dispute rolling, BP Canada considerably raised the ante earlier this year when it unveiled the Mist Mountain coal bed gas project. It is an ambitious five-year plan to explore and develop coal bed methane in the 500-square-kilometre Crowsnest coal field, north of the Cline property.

"We're committed to spending $2-million to $3-million a year for three to five years so we can understand what's out there from an environmental perspective, and we've hired an independent contractor to do that work," said Christopher Revington, BP Canada's vice-president of coal bed gas.

Should the project prove economically and environmentally feasible, Mr. Revington estimates it would contribute more than $2-billion in gas royalties, $2-billion in corporate taxes, and provide jobs for about 250 people over the life of the project.

Meanwhile, Ottawa has not yet responded to the U.S. request that it invoke its own environmental review of these projects. And U.S. officials have already suggested that they will take this dispute to the Canada-U.S. International Joint Commission if they are unhappy with the outcome.

Riches underground

Resource estimates for the East Kootenay region

of southeastern British Columbia:

Coal bed methane (CBM)

Resource estimate is 19 trillion cubic feet (tcf) among three East Kootenay coal fields: Elk Valley, Crowsnest and Flathead. The Ministry of Energy, Mines and Petroleum Resources (MEMPR) says CBM exploration to date has been focused in the Elk Valley and Crowsnest fields.

MEMPR estimates the CBM resource potential on the Crowsnest field is 12 tcf. BP Canada is seeking tenure to conduct a five-year, CBM exploration program over 500 square kilometres.

A successful program would lead to a $3-billion capital investment over the estimated 50-year life of the project, and an estimated $2-billion in resource royalty payments from gas production peaking at 650 million cubic feet a day.

Coal

MEMPR estimates that the Crowsnest coal field has more than 25 billion tonnes of coal in place.

Cline Mining Corp.'s feasibility study for the proposed Lodgepole mine estimates an inferred coal resource of 3.23 million tonnes, which it proposes to mine at a rate of two million tonnes annually over 20 years.

B.C. Ministry of Energy, Mines and Petroleum Resources