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Massey Synfuel ruling draws fire - News - tax credit for Appalachian Synfuel criticized in Canada, Australia - Brief Article
Coal industry government officials in Canada and Australia protested a ruling by the Internal Revenue Service that allows Massey Energy subsidiary Appalachian Synfuel in West Virginia to maximize capacity of more than 1.1 million tons a year.
At issue is the $26-per-ton federal tax credit to be allowed for increased synfuel production at the Appalachian Synfuel plant, a unit of the Marfork Mining complex in Raleigh County.
Coal Export Report, a weekly industry newsletter, quoted a Canadian official as saying, "We think the U.S. government should just call it what it is: a big subsidy for coal producers."
The newsletter said the Australian government plans to file a complaint with the World Trade Organization about what it calls a threat to the free market by U.S. coal synfuel exports.
According to the Oct. 30 edition of International Coal Trade, Rick Gazzard, a BHP Ltd. official, said at a meeting of the Australia-Japan Coal Conference: "Tax concessions to U.S. companies have created an unnatural and destructive force in the international coal market which has already damaged Australia's export performance."
Gazzard told Japanese steel producers that Australian coal producers were considering economic penalties against any company that buys U.S. coal synfuels.
Mark O'Neill of the Australian Coal Association said in Australia's Mining Monthly that "government subsidized coal production is particularly galling, especially when practiced by 'free-trading' countries like the United States."