SecProbe.io

<DOCUMENT>
<TYPE>LETTER
<SEQUENCE>1
<FILENAME>filename1.txt
<TEXT>
      July 1, 2005

via U.S. Mail

George J. Zilich
Chief Financial Officer and General Counsel
BPI Industries Inc.
30775 Bainbridge Road, Suite 280
Solon, Ohio
44139

Re:	BPI Industries, Inc.
		Form S-1 filed June 3, 2005
	File No. 333-125483

Dear Mr. Zilich:

      We have reviewed your filing and have the following
comments.
Where indicated, we think you should revise your document in
response
to these comments.  If you disagree, we will consider your
explanation as to why our comment is inapplicable or a revision is
unnecessary.  Please be as detailed as necessary in your
explanation.
In some of our comments, we may ask you to provide us with
supplemental information so we may better understand your
disclosure.
After reviewing this information, we may raise additional
comments.

	Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects.  We welcome
any questions you may have about our comments or on any other
aspect
of our review.  Feel free to call us at the telephone numbers
listed
at the end of this letter.

Form S-1

General
1. Where comments on a section also relate to disclosure in
another
section, please make parallel changes to all affected disclosure.
This will eliminate the need for us to repeat similar comments.

2. We will need time to review all new disclosure, any additional
proposed artwork or graphics and all omitted exhibits. You can
expedite the review process by providing all this information and
all
these documents promptly.  We may have additional comments.

3. We note the articles posted on your website under the tab,
"Reports and Presentations" are dated March 2001 and  January
2003.
It would appear that such articles are outdated and no longer
accurate reflections of the current developments in the coalbed
methane industry.  Please inform us of their current relevance.
4. Provide updated disclosure in each amendment.  For example,
include any updated information regarding the last reported price
of
your common stock as reported on the Toronto Stock Exchange and
the
drilling results with respect to the number of new production
wells
and test wells drilled.

Cover Page i
5. Consistent with the requirements of Item 501 (b)(10) of
Regulation
S-K, please include the "Subject to Completion" legend on the
cover
page of the prospectus.
6. Disclose the current market price, expressed in United States
dollars of the common stock being offered by the selling
stockholders
as of a recent date.
Prospectus Summary, page 1

Business, page 2

7. Provide us with objective support for the statements you make
regarding:
* your rights to control of "more [coalbed methane] acreage than
any
other [coalbed methane] company in the Illinois Basin";
*  your anticipated potential for more than 5,000 drilling
locations;
and,
* the Gas Research Institute`s estimate regarding the 21 trillion
cubic feet of coalbed methane gas in the Illinois Basin.
8. You state that you have identified seven potentially
commercially
productive seams within the Illinois Basin.  Clarify the nature of
your ownership, lease, option or farm-out agreements with respect
to
the seven areas you reference.
9. Revise to provide a summary of the material terms of the
Technical
Services Agreement.  Specifically, the right-of-first-refusal
granted
to BHP Petroleum (Exploration) Inc. and the associated stock
appreciation rights granted to BHP Petroleum (Exploration) Inc.
in
the event of a major transaction as defined in the agreement.
Provide a cross-reference to the more detailed discussion of the
transaction terms on page 27.
10. Avoid repetition of disclosure in the summary.  In this
regard,
we note the disclosure on page 2, "Business" regarding the number
of
production and test wells you plan to drill in the 12-month period
ending April 30, 2006 is identical to the disclosure appearing
under
the headings "Business Strategy" and "Competitive Strengths" on
page
3.  Please revise your disclosure  accordingly.
11. Revise to provide a summary that is balanced. For example, the
summary references your anticipated drilling program during the
12-
month period ending April 30, 2006, yet it does not disclose the
fact
that you currently have insufficient revenues and cash balances to
fully fund your capital expenditures and anticipated cash needs
through April 30, 2006.  Further, you reference The Gas Research
Institute`s estimates of the amount of coalbed methane gas in the
Illinois Basin yet you do not indicate that despite such
estimates,
the Illinois Basin is largely untested for commercial coalbed
methane
production.  Revise the disclosure so that you provide a more
balanced summary of your operations and anticipated challenges
with
respect to your planned operations.

Risk Factors, page 5

12. Please consider providing a risk factor to describe briefly
the
adverse material differences in shareholder protections under
Canadian law as compared to the law in a U.S. jurisdiction, i.e.
Delaware.  In addition, please discuss the difficulty that may
arise
in attempting to affect service of process on officers and
directors
of the company who are non-U.S. persons.
13. Provide a risk factor addressing the fact you are currently
not
listed or quoted on any United States national securities exchange
or
market.

Risk Factors Relating to Our Business, page 5
14. Include a risk factor that describes the right of first-
refusal
granted to BHP Petroleum (Exploration) Inc.  and the impact this
may
have on other parties` ability to acquire a majority of your
assets
or shares.
 "Our current revenues are minimal and not sufficient...," page 5
15. Please explain the statement that if you continue to
"demonstrate
the commercial viability of [coalbed methane] wells in the
Illinois
basin, [you] may encounter difficulty in raising additional
capital
on favorable terms."
"Because substantially all of our CBM acreage rights are
inferior...," page 6
16. Disclose the number of acres you have rights to explore and
drill, expressed as a percentage, that could be affected by the
possible assertion of superior rights by coal mining operators.
Further, advise us of any current or anticipated displacement of
your
operations as a result of competing coal mining operations.
"We could incur significant costs in connection with disputes over
surface rights...," page 7
17. Revise the heading of this risk factor and the risk factor
discussion so that you more clearly convey the risk that is not
only
associated with the legal costs incurred with respect to securing
surface rights, but the more material risk associated with your
potential failure to prevail in a dispute regarding surface rights
and the consequences of being unable to access a well.  In this
regard, we note the dispute with Sahara Coal Company, Inc.
disclosed
on page 31 which resulted in you having to access the well you
were
drilling via an alternate route.  Tailor your risk factor
discussion
so that you reference this dispute and any others that would be
material to your ability to conduct your operations.
18. If material, disclose the dollar amount you have expended in
connection with the legal disputes you reference.
"The occurrence of a significant adverse...", page 8
19. Eliminate language that tends to mitigate the risk being
disclosed.  In this regard, please remove the suggestion that your
insurance levels are adequate. Further, inform us of the dollar
amount spent on insurance and the basis for your belief that such
amount is "adequate" as compared to others in your industry.  We
may
have further comment.
"We will incur increased costs as a result of registering in the
United States," page 8
20. We note that you will incur increased compliance costs
associated
with complying with the rules and regulations of the Securities
and
Exchange Commission and the Toronto Stock Exchange.  Please
quantify
the amount of your increased compliance costs.
Cautionary Note Regarding Forward-Looking Statements, page 9

21. It is inappropriate to suggest that "will" identifies forward-
looking statements.  Please revise the disclosure at page 9
accordingly.

22. Inform us of the basis for your suggestion that United States
securities holders would have equivalent legal recourse against
the
company, despite the fact that the company is not a domestic US
corporation. We may have further comment.

Market for Our Common Stock, page 10

23. Inform us of the basis for your suggestion that United States
securities holders would have equivalent legal recourse against
the
company, despite the fact that the company is not a domestic US
corporation. We may have further comment.

Capitalization, page 11

24. Please include a statement indicating the table presented sets
forth your cash and cash equivalents and capitalization as of
January
31, 2004.  As cash and cash equivalents do not represent
capitalization of a company, please revise the summation of your
capitalization within your table to exclude the amount of cash and
cash equivalents as of January 31, 2004.

25. As to your indebtedness, please distinguish between guaranteed
and unguaranteed, and secured and unsecured, indebtedness.

26. Please use the caption, "Common stock issuable," instead of
"Liability to issue shares" to make the caption consistent with
what
you present on the Balance Sheets.

Dividend Policy, page 11
27. Revise to specify the "other factors" that your board of
directors will deem relevant in determining whether or not
dividends
will be paid.

Selected Historical Financial Data, page 12

28. Please revise your disclosure to explain your statement that
"the
financial data for the years ended July 31, 2001 and 2000 were not
audited in accordance with U.S. generally accepted accounting
principles."  If these unaudited financial data are prepared
consistent with U.S. GAAP, then please do not qualify their
presentation.  If they are not prepared consistent with U.S. GAAP,
then please make the requisite adjustments to them to ensure that
US
GAAP was consistently applied for all periods reported.

29. We note your disclosure that you translated Canadian dollar
amounts into U.S. dollars for the years ended July 31, 2001 and
2000.
Please expand your disclosure to explain why this does not apply
to
the other periods reported.  If you had a change in functional
currency, please expand your disclosure to explain this and to
identify the extent to which this impacts the comparability of the
amounts reported for these periods to the subsequent periods
reported.

Management`s Discussion and Analysis of Financial Condition and
Results of Operation, page 13

Overview, page 13

30. Throughout the MD&A you refer to the 12-month period ending
April
30, 2006.  Please explain why you have used this 12-month period
rather than one that conforms to your fiscal year end.  It appears
that the use of this period results in a gap in periods covered in
your discussion and analysis of your results of operations and
discussion of liquidity.

31. We note the disclosure here and in the risk factor discussion
regarding the shortfall in your ability to finance the estimated
$20
million expenditure planned for the 12-month period ended April
30,
2006.  As done on page 19, please also disclose in this section,
the
plans you have to fund your operations.  Disclose any specific
financing arrangement you currently have or anticipate entering
with
respect to the financing of your operations for the 12-month
period
ending April 30, 2006.

Critical Accounting Policies, page 13

32. Please revise your disclosures to address the material
implications of the uncertainties that are associated with the
methods, assumptions and estimates underlying your critical
accounting measurements.  Specifically, you should provide the
following:

(a)	An analysis of the uncertainties involved in applying the
principle and the variability that is reasonably likely to result
from its application.

(b)	An analysis of how you arrived at the measure and how
accurate
the estimate or underlying assumptions have been in the past.

(c)	An analysis of your specific sensitivity to change based on
outcomes that are reasonably likely to occur and have a material
effect.

Please refer to FRC Section 501.14 for further guidance.

Translation of Foreign Currency, page 14

33. We note that your expenses are converted at the average
exchange
rate for the year.  Please inform us whether you have any policies
in
place to hedge against losses due to exchange rates.

Results of Operations, page 15

34. Please expand your discussion to include disclosure of all the
key variables and other factors that you use to manage your
business.
Please ensure that your revised disclosure provides readers with a
view of your company through the eyes of management by providing
analyses of those key variables and other qualitative and
quantitative factors which are necessary for an understanding and
evaluation of your company.  For example, please expand your
discussion of revenue and operating costs to explain how your
results
differed due to operational events such as the number of producing
wells in each period and the related volume of production
achieved.
Refer to FRC Section 501.12 for further guidance.

Six Months Ended January 31, 2005 Compared to Six Months Ended
January 31, 2004, page 15

35. Please expand your disclosure to explain in detail why stock-
based compensation increased as a result of additional options
becoming available for issuance under your Incentive Stock Option
Plan.  It is our understanding that an increase in the number of
options available for issuance would not impact financial results,
though an increase in the number of options granted would.  Please
quantify the number of options granted and the related fair value
determined in your response.

36. Please tell us the consideration you gave to SAB Topic 5:A in
your expensing of legal fees incurred in connection with the $13
million private placement closed in December 2004 and January
2005.
Additionally, please reconcile $13 million in private placement
financing with the amount of proceeds from the shares issued in
private placement as shown in your Consolidated Statements of
Shareholders` Equity and Comprehensive Loss.

37. Please explain to in detail how your deferred income tax
benefit
increased primarily from the increase in your loss before income
taxes.  In your response, please address the impact the change in
the
deferred tax liability related to depreciation of property, plant
and
equipment had on your analysis. We note your related disclosure on
page F-16.

Year Ended July 31, 2003 Compared to Year Ended July 31, 2002,
page
18

38. Please expand your disclosure to explain in detail why your
deferred income tax benefit increased in 2003 over 2002 and the
extent to which management judgment was required and what
assumptions
were used to form this conclusion.

Liquidity and Capital Resources, page 19

39. Please inform us of the basis of your belief that adequate
funding can be obtained on terms at least as favorable as you have
received in the past three years.  Moreover, we note the risk
factor
reference on page 6 to competition in the coalbed methane gas
industry and the risk posed by new entrants to your operations. In
addressing our comment, please inform us of the consideration you
have given to your ability to obtain funding in such a competitive
environment.

40. Please amend your discussion to identify and explain the
impact
of expected changes in production volumes and the timing of when
those volumes will be produced on the amount and timing of future
cash flows.  Please disclose that no properties are in commercial
production as you noted in your consolidated financial statements
and
indic