Coal company seeks more than $3.4B in damages from Alberta government over policy change

Four months after the provincial government announced it was doing a U-turn on looming coal policy changes, a private coal company says it has started legal proceedings based on the impacts of that reversal.

Cabin Ridge Holdings Ltd. and Cabin Ridge Project Ltd. announced on June 30 that legal proceedings had commenced against the government. 

In a release, the companies argue that the province "substantially and unreasonably" interfered with the private company's development rights and deprived it of "any reasonable use" of its mineral rights.

"The Cabin Ridge companies have invested significantly to acquire their freehold mineral rights and project assets for the purpose of developing a world-class metallurgical [steelmaking] coal project," reads the release.

The statement of claim filed by the companies on June 27 says they are seeking damages in the amount of $3.441 billion due to "loss of net present value" of the property.

Alternatively, the claim says, the companies are seeking restitution in the amount of $56 million plus future and contingent remediation costs.

The allegations have not been tested in court.

READ | The statement of claim filed by the companies behind the Cabin Ridge project:

The Cabin Ridge project is approximately 50 kilometres north of Coleman, Alta., a community with a population of slightly more than 1,400 in southwest Alberta.

Unlike most coal companies in the province that hold coal leases, the Cabin Ridge project includes approximately 5,000 hectares of freehold mineral rights, meaning that coal is privately owned by the company.

The provincial government was hit with a barrage of criticism and legal challenges from landowners, municipalities and First Nations after it said in May 2020 that, without public consultation, it would rescind Alberta's 1976 coal policy that limited coal development in the eastern slopes.

In March, the government announced it would instead keep that policy in place, barring coal development and exploration activities in parts of the Rockies for the time being.

The companies claim the government's change in position represented a "de facto expropriation" of its freehold mineral property and prevented it from continuing to develop its project.

It also claims the move deprived the companies of its "substantial investments" in Alberta.

Without the reversal, the companies claim the proposed mine would create approximately 500 direct jobs during operations and approximately $2 billion in taxes and other revenue for the federal and provincial governments.

The conservation program manager with the Canadian Parks and Wilderness Society (CPAWS) characterizes those claims as being "fairly dubious."

"Recent research has shown that job projections and revenue projections for coal projects in Canada are frequently severely overestimated," said Becky Best-Bertwistle.

"I'm really disappointed to see that Cabin Ridge can't respect that Albertans have said no to any new coal developments in the eastern slopes."

There was no response by press time to CBC's requests to Cabin Ridge Holdings Ltd. and Cabin Ridge Project Ltd. for additional comment.

A spokesperson for Alberta Minister of Energy Sonya Savage declined to comment, saying the ministry could not comment on matters before the courts.