The Rocky Mountains west of Nanton where ranchers and farmers worried about pollution and their water supplies objected to a new proposed coal mine by the former Jason Kenney government in Alberta.Todd Korol/The Globe and Mail
Alberta’s energy regulator will consider controversial applications to explore a new coal mine in the foothills of the Rocky Mountains, ruling the project is excluded from a government-mandated ban on exploration approvals.
The decision announced on Friday applies to a set of permit applications for exploratory activities by Northback Holdings Corp. at Grassy Mountain, on the site of an old mine that closed about five decades ago. Northback, formerly Benga Mining Ltd., is a subsidiary of Australian mining giant Hancock Prospecting Pty Ltd. Benga’s application for an open-pit mine on the land was rejected by a joint federal-provincial panel in June, 2021, because of environmental concerns.
That decision came at a time of intense public backlash over coal mining in Alberta, which forced the government to halt exploration for coal on a swath of sensitive land and cancel a series of leases earmarked for potential new mines. In 2022, then-energy minister Sonya Savage also directed the Alberta Energy Regulator to suspend approvals and refuse new applications for exploration and development unless they were related to an advanced coal project or an active approval.
Grassy Mountain was one of three projects listed as advanced in a December, 2021, report by Alberta’s coal policy committee, which was tasked with developing recommendations to establish modernized rules for coal mining.
Northback has maintained that its Grassy Mountain plan should therefore be considered an advanced project at the regulatory level, and Alberta Energy Minister Brian Jean agrees.
The AER had asked Mr. Jean to clarify the intent of Ms. Savage’s ministerial order so it could decide whether to process Northback’s applications for a 105-day exploratory drilling program and a request for a water diversion.
Mr. Jean told the regulator in a November letter that under the ministerial order, a coal mine project retains its advanced status regardless of previous application outcomes. That means an application that has been rejected can still be reconsidered if a company files a new application.
Citing that letter in its decision, the regulator said Northback’s applications would now proceed to a public hearing conducted by a panel of AER commissioners.
The AER in its decision also cited Alberta’s Responsible Energy Development Act, which allows the energy minister to provide guidelines for the regulator to follow in the carrying out of its powers and duties. As such, the letter from Mr. Jean “carries significant weight,” it said.
Mr. Jean was not available for an interview Friday, but told The Globe and Mail in November that while he wouldn’t commit to introducing any further rules to lessen the effects of coal mining, “We can’t risk our environment and our drinking water.”
Northback CEO Mike Young said in an e-mailed statement Friday that the company looks forward to learning more details about the panel review “and sharing how our expertise and experience will ensure this exploratory drilling program is safe and protects the valuable water resources in the region.”
The decision to consider Grassy Mountain’s applications comes as Alberta faces an extreme drought and braces itself for an early start to the wildfire season. The province is already at its second-highest level of drought planning because of a lack of rain and the early depletion of mountain snow last year. The next stage is a province-wide emergency.
Conditions across much of the province are so dry that one regional agency has already banned oil and gas operations from using its treated water and, for the first time in more than 20 years, the government is negotiating with major water licence holders to strike voluntary water-sharing agreements.
Coal is a thirsty business, says Laura Laing, a southern Alberta rancher who opposes the mine.
Ms. Laing said Friday while she’s disappointed in the AER’s decision, it is “unprecedented” for early-stage exploration applications to go to public hearings and will give Albertans who oppose the project another chance to have their say.
“Even though we are an agricultural industry, we don’t really always feel heard. At least there’s an opportunity here for that,” she said.
Northback says if approved, the permits would allow it to collect technical data at Grassy Mountain to assess the merits of mining the metallurgical coal, which is used to make steel. If Northback deemed the project viable, it would require further consultation and permitting before a mine could be built.
But with Alberta heading into a critical year for water, Ms. Laing wants to know where water for a mine would come from.
“To say ‘We’re just in an exploring stage,’ that’s still messing with water for the purpose of coal development. So where’s that going to come from? Oil and gas? Agriculture? Communities? This is not a well-thought-out plan at all.”