Panel begins review of Alberta coal mine
Australian company Riversdale looks for approval to build Grassy Narrows project
In a project that provides a window into the future of Canada's vast natural resources, a joint federal-provincial panel on Tuesday kicked off a review of an Australian company's proposal to reopen a part of southwestern Alberta to coal mining after a nearly four-decade absence.
Benga Mining Ltd, a Calgary-based subsidiary of Australia's Riversdale Resources Ltd., which is itself owned by Perthbased Hancock Company, is looking for approval to build an openpit steelmaking coal mine near Crowsnest Pass, about a threehour drive southwest of Calgary.
Although Riversdale is only proposing one mine, known as the Grassy Narrows Coal Project, other companies are also hoping to build mines in the area and approval or rejection of the project could be a bellwether for the fate of other developments.
Already, intense divisions have sprung up as local town residents, who see mining as a boon for the local economy, support it while ranchers, environmentalists and others say it would threaten water supplies and wildlife, including the native westlope cutthroat trout, which is considered at risk. Meanwhile, Riversdale has struck agreements with local Indigenous communities, some of which support it and others of that are merely neutral.
More narrowly, the project also opens a discussion on steelmaking coal, which is used as its name suggests, to make steel, and not as controversial as thermal coal, which is used to generate power and is under increasing pressure from investors and climate-change activists.
“The ability to produce high quality steelmaking coal from countries … such as Canada is of vital importance,” Gary Houston, Riversdale's vice-president of external affairs, said in his opening remarks at the hearing on Tuesday, adding that strong markets in India, China and elsewhere ensure there will be demand.
He pointed out that Canada is “strategically positioned from a freight point of view to access Asian markets,” a reference to the existing railways in the area that would allow the company to ship its coal to ports, and avoid the massive infrastructure investments, or pipeline debates, that have held up other energy projects in Alberta.
The joint three-member review panel, which includes members of the Alberta Energy Regulator and the federal Impact Assessment Agency of Canada, is collecting testimony from various stakeholders in a process expected to last into November, and is being streamed live online.
Riversdale has been doing preliminary development work on the Grassy Mountain Coal Project since 2013. Located half on Crown and provincial land, and half on private lands, it would create a 1,500-hectare open pit mine that would require mountaintop removal.
The $800-million project would produce 4.5 million tonnes of steelmaking coal per year for 23 years.
Houston, of Riversdale, testified that the company aims to start construction in the second half of 2021, so it can begin producing and shipping coal by 2023. The project would provide about 500 jobs during its two-year construction phase, and about 400 jobs once the mine is operational.
The company estimates that the mine, over its 23-year life, would produce $35 million in municipal taxes, plus $1.7 billion in royalties and taxes to other levels of government. But that's assuming that steelmaking coal prices hold steady.
Teck Resources, which produces steelmaking coal in British Columbia's Elk Valley, just on the other side of the mountains, has faced consistent problems with its steelmaking coal operations.
This week, it reported a 35-per-cent decline in the average realized price for steelmaking coal from the same three month period last year — from $206 per tonne to $135 per tonne. But it has also faced environmental problems and the company has said that in 2018, Canadian federal prosecutors informed it that it may face charges under the Fisheries Act for the discharge of selenium and calcite into nearby watersheds.
Now, people are flagging concerns about those same environmental issues on Riversdale's project. Ian Urquhart, conservation director of Alberta Wilderness Association, said his group is concerned about not only water pollution issues, but also water usage issues, and a potential drop in the local groundwater table that is much larger than Riversdale has predicted.
“Our biggest concern is on the water side,” Urquhart said.
Riversdale has said it has letters of support from local First Nations and Metis communities, but at the hearing Tuesday, Bill Snow, a consultation manager for Stoney Nakoda First Nation, gave a more nuanced view. Snow said his community had struck an agreement to support the project, with conditions — including that Indigenous citizens could act as monitors of socioeconomic and environmental impacts of the project. Also, the support is premised on approval by the joint review panel, he said.
Snow said his community has “remained neutral, but will accept the joint panel's review decision if they find the project can be built safely in accordance with” environmental standards.
Hearings are scheduled until Nov. 30.