Alberta’s Coal Fight Heats Up

Coal dust and controversy are once again flying in a raucous Alberta battle that pits cowboys and conservationists against an Australian open-pit mining project tacitly backed by Premier Danielle Smith.

Last week the Alberta Energy Regulator rejected arguments for an adjournment of a public hearing on three exploratory drilling licences for the proposed Grassy Mountain metallurgical coal mine despite a pending court challenge that raises questions about the legality of those proceedings.

“While we have the discretion to grant an adjournment, we are not persuaded that doing so in this case is appropriate….” said the AER in its decision. “The requested adjournment, which would likely result in a lengthy delay, would make this proceeding less efficient.”

The Municipal District of Ranchland and other parties concerned about the mine’s potential harms to water quality and quantity in the region had requested a postponement of AER’s hearings set for January because of a successful Alberta Court of Appeal ruling last month.

That judgement found that the regulator has not properly explained how an open-pit metallurgical coal mine rejected by its own staff as a threat to water sources — a decision upheld by three separate courts — could be still construed as an “advanced coal project” and therefore be exempt from a 2022 ministerial order banning coal development and exploration in the eastern slopes of the Rockies.

It also found that the AER may have fettered its own authority and erred by taking direction from a letter from Energy Minister Brian Jean on what constitutes an “advanced coal project.” Citing these three arguments, the judge then granted an appeal of AER’s decision to hold a hearing that the regulator now refuses to adjourn.

Going ahead ‘as if nothing happened’

Legal scholars such as the University of Calgary’s Nigel Bankes have argued that a foreign-owned mining project rejected by regulators can’t suddenly be reanimated and construed as “advanced” without making a mockery of the law.

Bankes wasn’t surprised by the AER’s refusal to adjourn. In a social media post he explained. “In effect the AER is saying that even though the question before the court is whether or not the hearing should be occurring at all, the AER will go ahead as if nothing happened when the court granted permission to appeal.”

The AER’s decision argued that the industry funded regulator was “the master of its own procedures.”

Northback Holdings, a company owned by the litigious and powerful Australian billionaire Gina Rinehart, opposed all arguments on pausing the hearings on its exploratory coal applications. In a Sept. 18 letter the firm threatened the regulator that any hearing delay might force it to “re-evaluate its investment options in Alberta.”

The letter also claimed any appeal would fail and that the government and not the courts should determine resource development. It also warned that if there were any further delays on its exploratory applications the province’s minister of energy might exercise his powers and ensure that Northback’s applications proceed without further delay.

Northback, which has furiously lobbied the government over the last two years to resurrect its project, spelled out what that action could be. “Among other things, the minister could issue an order directing that the applications continue to be processed by the AER, or that Grassy Mountain is an advanced coal project and any applications in connection with Grassy Mountain should be processed by the AER.”

Rumours are now swirling around the Alberta legislature that Jean may indeed issue a new ministerial order in the next couple of weeks. It would officially recognize Grassy Mountain as an “advanced coal project” in order to neutralize the court of appeal challenge.

The Municipal District of Ranchland, which represents ranchers, conservationists and water drinkers opposed to open-pit mining in the critical Oldman watershed, countered that Northback’s submissions are simply a political plea to the energy minister to again interfere in the AER’s regulatory process and give Northback’s applications special treatment.

Ranchland warned that bullying the regulator and minister may be counterproductive. “Northback has asked that the AER compromise its independence by seeking direction from a cabinet minister of the Government of Alberta, in order to benefit a single applicant. This request is highly improper, and we expect that any attempt by the AER to seek Minister Jean’s political intervention would be subject to a high degree of both public and judicial scrutiny.”

The municipal district further argued that no participant “would be well served by a situation where they have undergone a full hearing, only to have the AER’s decision overturned by the Court of Appeal, rendering the entire proceeding a nullity.”

Why the project was killed

In related news Crowsnest Pass municipal council has passed a motion to hold a non-binding vote on whether the local community supports the open-pit mine. Northback Holdings has spent millions on local projects to influence community support, such as constructing a golf course and funding a school lunch program.

The project, which would extract 4.5 million tonnes of metallurgical coal over 23 years, would scrape bare a 1,521-hectare area of Grassy Mountain.

After a lengthy hearing that was prolonged by the poor quality of environmental assessments performed by Rinehart’s company, federal and provincial regulators concluded in 2021 that the project would contaminate the Oldman watershed with selenium and other heavy metals.

They also noted that the project‘s Australian developers had not done their due diligence, did not provide proof of effective management strategies and greatly underestimated the efficacy of their incomplete plans for selenium management.

The issue of toxic selenium pollution from coal mining has become chronic and intractable. In neighbouring B.C., multiple open-pit mines owned by Swiss mining giant Glencore, formerly Teck Resources, continue to release a steady stream of selenium into waterways and atmosphere despite $1.4 billion worth of water treatment facilities.

A study by the United States Geological Survey found that selenium pollution from the Elk River Mines “is transported over 575 river kilometres and may pose risks to aquatic life in the transboundary Columbia River.”

While running for the leadership of the United Conservative Party, Smith promised she would ignore the regulatory decisions rejecting the mine and put the issue up to a local referendum in the Crowsnest Pass, a region where foreign-owned mines went bankrupt in the 1960s.

Smith, a former lobbyist for the Alberta Enterprise Group and advocate of resource development, told supporters that if locals supported the project, she would help it forward.

Alberta’s political coal battles erupted when the UCP government of Jason Kenney abruptly overturned policies protecting the eastern slopes of the Rockies from open-pit coal mining in 2021.

Australian miners even learned about the policy change before Albertans did. In the ensuing coal rush developers acquired leases up and down the Rockies in critical watersheds. The invasion resulted in a public backlash that forced the UCP to backtrack on its plans and issue a new ban on coal mining and exploration in 2022. Five mining companies are now suing the UCP government for $10 billion and accuse it of reneging on promises made by the Kenney government.

Since then the UCP government of Danielle Smith has worked on ways to undermine the ban by tacitly supporting Rinehart’s Grassy Mountain project.