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BHP to quit coal alliance

December 19, 2017

The world's biggest mining company has threatened to leave the World Coal Association and review its membership of the US Chamber of Commerce due to differences over climate and energy policies.

Ukraine Bergwerk Tunnel Bahn Symbolbild
Image: picture alliance/dpa/I. Maslov

The Anglo-Australian mining giant is reviewing its industry group memberships to see if their positions on climate change and energy policy align with the company's view that climate change must be tackled through emissions reductions and the use of renewable energy.

BHP, which is one of the world's biggest coal miners, said it was making a preliminary decision to part ways with the World Coal Association (WCA), which would be reviewed by next March.

In addition, BHP said it was also considering withdrawing from the US Chamber of Commerce because of the organization's criticism of the Paris climate agreement and its opposition to carbon pricing.

Read more: Fossil fuel lobbies cripple UN climate talks, report says

BHP's membership in the Minerals Council of Australia was also to be reviewed next year, the groups said. It would however remain a member for the time being, given the benefit it derives from membership, and despite differences on climate policy.

BHP's chief external affairs officer Geoff Healy said the 22-page review released Tuesday demonstrated the firm's support for action on climate change and commitment to transparency.

"While we won't always agree with our industry associations, we will continue to call out material differences where they exist and we will take action where necessary, as we have done today," he said in a statement.

The PR of the fossil-fuel lobby

Seismic shift

BHP's 22-page review of industry partnerships said the company's policy was aimed at tackling climate change through encouraging the use of all technologies, rather than favoring just one. Lobby groups, such as WCA, were favoring cleaner coal technologies and obstruct investment in renewables, it added.

Read more: BHP sees metals demand rise on e-mobility, China projects

Moreover, emissions reductions "are necessary to mitigate climate change," the report said, outlining BHP's stance in support of the Paris pact on cutting emissions. "An effective global framework to reduce emissions should use a portfolio of complementary measures, including a price signal on carbon."

Brynn O'Brien, executive director of the Australasian Centre for Corporate Responsibility, said BHP's decision to cut ties with the WCA was a "seismic shift in the world of anti-climate lobbying."

"It is an emphatic market signal that the era of aggressive anti-climate lobbying is no longer acceptable," O'Brien said in a statement.

Ian Dunlop, a former president of the Australian Coal Association and now an activist on climate change, said BHP's decision represented real progress but did not go far enough.

"This shows the brick wall erected by fossil fuel companies on climate change is beginning to break down. BHP has to realize thermal coal must be phased out faster or the world can't meet its Paris climate target," he added.

Read more: China u-turns on rapid end to coal heating

BHP's decision comes as some governments look to move away from coal-fired power, a key driver of global warming and air pollution. Global demand for the fossil fuel is forecast to remain flat between 2017 and 2022, resulting in a "decade of stagnation for coal consumption", the International Energy Agency predicted.

No more coal for climate

uhe/nz (AFP, dpa)