The Age reported that confidential Cabinet documents it obtained show the Victorian government is considering offering billions of tons of the coal for competitive tender in 2010. The tender process would be preceded by a go-ahead for a $1.5 billion plan by energy company Exergen to mine, dry and ship 12 million tons of brown coal annually to India.

In addition to being greenhouse gas intensive, brown coal contains a high level of water and is low in energy efficiency. But proponents say that new technological approaches, including drying, can lower its moisture content from more than 60 percent to about 25 percent, cutting emissions when burned by about 30 percent.

The company's Web site states that Exergen coal is more dense and compact than the brown coal it is sourced from. Once stabilized, in a briquette form, the Web site says, "it is an ideal export product enabling the benefits of reduced emissions to be made available to any nation."

According to The Age, the official documents it obtained indicate that public concerns could arise from the export of brown coal, a greenhouse-gas intensive fuel. But, the documents state, the exports can be justified on three grounds: that Victoria cannot on its own limit global emissions; the coal could help developing countries overcome poverty, and emissions in those countries could be even higher if Victorian coal is denied and dirtier fuels are used.

Environment Victoria, a lobby group, says brown coal is one of the least environmentally friendly fuels and there have been few technological advances to clean up the resource.

Mark Wakeham, campaign director for the group, said the state, in justifying coal exports on the grounds that it was not responsible for a global climate agreement, is ''like saying we can't singlehandedly deliver world peace so let's go on a killing spree."

"We think this is largely about trying to get hold of a coal allocation before it all gets too hard with global climate change deals and as the industry's social license to operate evaporates," Wakeham said.

The Age reports the Cabinet documents indicate Victoria's Gippsland has coal reserves of 33 billion tons. That's enough to power Victoria for some 500 years at the current rate of consumption. Approximately 13 billion tons of Gippsland's reserves are still unallocated and could be available for export.

In September Victoria Premier John Brumby said he saw no reason why the state should not export brown coal. ''Australia exports oil, Australia exports gas, Australia exports black coal and Australia exports uranium,'' he said. ''So why you would single out brown coal and say you can't export that?''

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