Grassy Mountain coal project 'not in the public interest,' Alberta review panel says

A review panel for the Alberta Energy Regulator has denied the provincial application for the Grassy Mountain coal project, ruling the project is "not in the public interest."

"The panel's decision reflects the AER's commitment to making evidence-based and risk-informed decisions in the public interest," said Laurie Pushor, president and CEO of the Alberta Energy Regulator, in a release.

In a statement, Energy Minister Sonya Savage and Environment and Parks Minister Jason Nixon said they respected the panel's recommendation.

"All proposed coal projects are subject to stringent review to ensure development is safe, environmentally responsible and meets all requirements," the statement reads.

"In this case, the process worked as it should. The panel's recommendation demonstrates that Alberta's legislative and regulatory framework is robust and thoroughly considers environmental impacts as part of any resource development project."

Project was in the works for years

Communities in the Crowsnest Pass were built around coal mining more than 100 years ago and the industry was the area's lifeblood for most of the 20th century.

Several major coal mines still operate just to the west, in British Columbia's Elk Valley, but the region's last mine on the Alberta side of the border closed in 1983.

The plan for the proposed Grassy Mountain project, located roughly seven kilometres north of Blairmore, was to pick up where a previous mine had left off. A section of the 1,500-hectare site has already been disturbed by previous mining activity decades ago.

Australia-based Riversdale Resources submitted a proposal to regulators in 2016 for the project, which it estimates could produce 4.5 million tonnes of steel-making coal annually over the mine's 23-year lifespan.

The company estimates this would have created nearly 400 full-time jobs.

Other Australian coal companies had been watching closely, as they ramped up exploration and drew up plans for mines of their own.

"I would say the industry is looking to the success of Riversdale's project, because it's the first in the Crowsnest Pass area," Atrum Coal's then-CEO Max Wang told the Calgary Herald in 2018.

"There are quite a number of global investors, mostly from Australia, interested in that region … but they are very much looking to the success of Grassy Mountain."

The difference in coal-mining activity between southwestern Alberta and southeastern B.C. dates back to Alberta's Coal Development Policy, which was adopted by premier Peter Lougheed's government in 1976 with the dual goals of increasing government royalties and protecting sensitive lands.

The UCP government rescinded that policy last year, sparking a backlash from a wide range of Albertans, including environmentalists, ranchers and tourism operators.

In February, the government backtracked and re-instated the Lougheed-era policy for the time being, pending further consultation.

Federal government also involved

The Grassy Mountain project was supported by the mayor of Crowsnest Pass and many residents hoped it would bring high-paying jobs to an area of the province with few such employment opportunities.

But concerns were raised during a hearing about the chance the mine could contaminate headwaters of the Oldman River with selenium. The element commonly found in coal mines is toxic to fish in large doses, and has been linked to fish deaths and deformations downstream of mines just to the west in B.C.

The review panel also heard the mine would damage ecosystems and impair the cultural and physical heritage of three local First Nations, although the council of the nearby Piikani First Nation had officially supported the project.

"The mitigation measures proposed are not sufficient to fully mitigate these effects," says the report.

The panel advises federal Environment Minister Jonathan Wilkinson to turn the mine down. It has also denied the project's permit applications under provincial laws.

The Grassy Mountain mine is the first of a number of coal projects that have been proposed for the mountains and foothills of Alberta's western boundary. At least eight companies have taken large exploration leases.

In April, however, the province announced a suspension of coal exploration activity in lands classified as "Category 2" under the Lougheed-era coal policy — again, pending further public consultation.

Category 2 lands were subject to more stringent restrictions, and open-pit mining was not normally allowed in these areas.

The Grassy Mountain project, however, was located on a section of Category 4 land, with fewer restrictions under the 1976 policy.

Earlier this week, Wilkinson announced that any proposals from those exploration leases would be subject to a federal environmental review. He said concerns about selenium prompted the move.