In -20, a fleet of explorers from the fledgling Island Union landed on the southern tip of the island, and thought it to be uninhabited. They discovered reserves of coal in the mountains, and began work towards extracting it. However, as they began to do so, it became apparent that the island was in fact inhabited. Negotiations over access to the coal failed and conflict broke out in -14, with Bhalua lending aid to Caalgen. This conflict came to be known as the First Great War.
When the war ended in -10, it was agreed that part of the mountains would be protected and that mining would happen elsewhere. Following this, Bhalua and Caalgen were incorporated into the growing alliance of nations.