By Nicole Mordant
VANCOUVER (Reuters) - British Columbia Premier Christy Clark, campaigning one week before an election, said on Tuesday her ruling Liberal party will apply a levy on thermal coal exports from the Canadian province if it is re-elected and the federal government does not ban exports.
Clark, whose Liberal party is neck-and-neck with the opposition New Democratic Party in polls ahead of a May 9 election, last week called on Canadian Prime Minister Justin Trudeau to ban thermal coal exports through British Columbia.
The move is in retaliation against the United States for slapping duties on Canadian softwood lumber. A handful of U.S. miners ship coal through B.C. ports. Meanwhile, British Columbia is Canada's largest producer of softwood lumber, and last year exported C$4.6 billion ($3.35 billion) worth to the United States.
If the Canadian government does not ban exports, a re-elected B.C. Liberal government would develop regulations to levy a carbon price on all thermal coal shipped through B.C. ports, Clark said in a statement.
The levy will reflect the greenhouse gas emissions caused by the coal's extraction, processing, transportation and combustion, she said in a statement.
A coal levy, which would be the world's first greenhouse gas benchmark for thermal coal according to the Liberals, would make it uncompetitive to ship thermal coal through B.C. ports, Clark said.
Between 70-90 percent of coal produced in B.C. is metallurgical, or steel-making coal, not thermal coal, which is burned for heat to produce electricity.
U.S.-based Cloud Peak Energy would be the biggest U.S. coal producer affected by a B.C. export ban or levy, Jefferies analyst Christopher LaFemina said in an April 28 note to clients.
Cloud Peak's shares were 12.5 cents firmer at $3.65 on the New York Stock Exchange on Tuesday afternoon. Its stock had dropped nearly 21 percent to as low as $3.10 after Clark proposed a coal ban last week.
U.S. coal is railed to B.C. ports by Burlington Northern Santa Fe Corp, a railroad owned by Warren Buffett's Berkshire Hathaway Inc.
B.C. environmental groups have called on the government for years to ban thermal coal exports, saying it is a dirty source of energy.
Some 38 percent of decided voters back the B.C. Liberals compared to 37 percent for the NDP, according to the latest Justason Market Intelligence poll.
($1 = 1.3720 Canadian dollars)
(Reporting by Nicole Mordant in Vancouver; Editing by Steve Orlofsky and Chris Reese)