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Local Economy

Aussie Billionaire Sues to Reverse Rejection of Open-Pit Mining

Gina Rinehart is challenging the federal decision to block a giant coal mine on the eastern slopes of the Rockies.

Andrew Nikiforuk 20 Aug

Tyee contributing editor Andrew Nikiforuk is an award-winning journalist whose books and articles focus on epidemics, the energy industry, nature and more.

Australian billionaire Gina Rinehart, a climate change skeptic who believes governments are strangling the mining industry with red tape, is taking the Alberta and federal governments to court after they rejected her controversial Grassy Mountain project in southern Alberta’s foothills.

Last week Benga Mining, a subsidiary of Riversdale Resources owned by Rinehart’s Hancock Prospecting, applied to the Federal Court of Canada to overturn Environment Minister Jonathan Wilkinson’s decision to kill the open-pit metallurgical coal mine on the grounds it would cause “significant adverse environmental affects.”

Wilkinson partly based his decision on an extensive 679-page Joint Review Panel report led by the pro-industry Alberta Energy Regulator and the federal Impact Assessment Agency.

Last June the panel concluded the company had grossly underestimated the impacts of selenium pollution on the Oldman River basin and overestimated economic benefits of the mine.

Selenium pollution of waterways has become a major liability for mining giant Teck Resources in B.C.’s Elk Valley.

The report also noted that the destruction of Grassy Mountain would threaten already endangered cutthroat trout and surface water quality in the Oldman River basin.

The AER offered a rare regulatory decision in the province: it mostly says yes to projects. And it did so when the highly unpopular Jason Kenney government has courted Aussie coal miners with promises of red tape reduction, royalties as low as one per cent, lower corporate taxes and, in the case of one mine, a letter of support from Alberta’s Environment Minister Jason Nixon.

The Benga Mine was to be the flagship of an Australian mining invasion in the region. As many as half a dozen companies, many of them penny stocks, want to industrialize a 1,000-square-kilometre area with open-pit coal mines. Unlike the Kenney government most Albertans oppose the mining of the important watersheds of the Rocky Mountains.

As soon as the AER released the Joint Review Panel report, Benga Mining appealed its conclusions in Alberta’s Court of Appeal on the grounds that “it made a number of errors in law and contraventions of procedural fairness.”

The leadership of two First Nations, the Piikani Nation and the Stoney Nakoda Nation, which signed impact benefit agreements with Benga Mining, have applied to join Benga’s appeal.

But most members of the Blackfoot Confederacy remain opposed to open-pit mining in the eastern slopes of the Rockies because it will dig up a sacred landscape shaped by Napi (Old Man), the legendary Blackfoot creator.

The Siksika Nation, for example, noted in a brief statement on Benga’s provincial appeal that “the Government of Alberta has not addressed Siksika’s concerns about coal projects in the Crowsnest Pass region” and therefore the Siksika “will continue to oppose any other efforts to pursue coal mines.”

Benga’s arguments that both federal and provincial government have ignored First Nation rights is somewhat contradicted by the composition of the review panel that said no to the project: two of its three members are of Indigenous descent.

Katie Morrison, southern Alberta conservation director for Canadian Parks and Wilderness Society, said the legal action amounted to a corporate temper tantrum.

“I think that Benga thought that just going through the motions of an application entitled them to a project approval. But that is not how it works, and in the end they couldn’t prove to the Joint Review Panel or to the federal government that they could protect the important ecological or social values of the area, particularly clean water and threatened species,” Morrison told The Tyee.

“So with the rejection of the project, they are now grasping at every straw to try to find fault in the process rather than accepting the outcome that they are unhappy with.”

In a press release Benga Mining said it decided to take the Canadian government to court after the environment minister ignored its June request to delay a final decision on the mine until its legal action against the Alberta Energy Regulator in the Alberta Court of Appeal was resolved.

According to Benga, Wilkinson did not reply to their request.

But the Impact Assessment Agency of Canada explained in an email that “The Minister of Environment and Climate Change was required to make his decisions under Canadian Environmental Assessment Act 2012, irrespective of the requests to appeal the decision of the Joint Review Panel in its capacity as the Alberta Energy Regulator.”

Benga CEO John Wallington has expressed dismay “that Canada’s minister of environment could render a decision so hastily, and based on a report that is facing multiple legal challenges. Not only were the minister’s and cabinet’s decisions premature and ill-informed, they were also made without adequate consultation with the relevant First Nations, something that is unconscionable within the rigours of a modern regulatory approval process.”

Rinehart, Australia’s wealthiest billionaire, is one of Australia’s most controversial mining magnates because of her right-wing views and litigious habits against anyone who stands in the way of her business ambitions, including members of her own family.

Her neverending legal battles with her four children over a $5-billion family trust fund have both appalled and entertained Australians for years.

After inheriting some of the largest mining leases in the rich Pilbara region from her father, Lang Hancock, Rinehart has amassed her own fortune by riding the Chinese boom and exporting iron ore to Asia.

In 2019 Rinehart’s Hancock Prospecting branched out to the Crowsnest Pass in the Canadian Rockies. It bought Benga Mining and its proposed Grassy Mountain project for $700 million while its proposal was undergoing a joint federal and provincial environmental review by the AER.

“For a long time, Hancock has wanted to find a good metallurgical coal opportunity to complement our iron ore projects — both commodities being critical for steel making," said Rinehart said at the time.

Rinehart, who also owns large thermal coal leases in Australia, is used to getting her way as well as telling authorities how they should regulate.

She believes that governments should cut both red tape and taxes to promote mining and even wrote a book on the subject: From Red Tape to Red Carpet and Then Some.

In Australia the powerful coal and mining industry broadly influences government policy and has played a major role in retarding action on climate change and reducing taxes for mining firms.

Rinehart, bedecked in pearls, led that successful fight in 2010 with the war cry: “Axe the tax.”

Australia’s mining approval process has been called a “rubber stamp” by ranchers and environmentalists due to a well-documented revolving door for lobbyists, industry and government officials.

Rinehart has also used novel legal arguments to support her contentious mining projects. To defend the unpopular Alpha Mine thermal coal mining project, Rinehart, for example, employed what is known as the “Drug Dealer’s Defence” in the courts of Queensland. The argument is simple: “If we don’t supply the coal, another mine will, so allowing this mine will have no impact on climate change.”

While conservationists and ranchers argued that the $4-billion coal project would destroy groundwater and contribute more dirty emissions to the climate crisis, Rinehart’s lawyers won the right to use the defence in 2016. “The decisions of the Queensland Court of Appeal and the High Court have, in effect, approved this defence as lawful for Australian coal mines,” noted Environmental Law Australia.

Rinehart has also contributed millions to Australia’s Institute of Public Affairs, a conservative think tank that has championed coal mining, climate skepticism and lower taxes for mining companies.

No stranger to controversy, Rinehart often makes her views known on her website or in presentations to the mining lobby. In 2012 Rinehart advocated for lowering the minimum wage in Australia and told Australians to work harder.

“If you’re jealous of those with more money don’t just sit there and complain... do something to make more money yourself — spend less time drinking or smoking and socializing and more time working,” wrote Rinehart in a column for one of her favourite publications: Australian Resource and Investment magazine.  [Tyee]

Read more: Local Economy, Politics

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