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Who will clean it up?

​Alberta put a pause on coal. But its footprint remains

Locke Stock Creative

It’s quiet in Coleman, Alta., a historic coal town located within the Municipality of Crowsnest Pass, a cluster of five communities along Highway 3 in southwestern Alberta.

The downtown brims with symbols of this town’s past. Many historic buildings are boarded up, their futures plainly uncertain. The ruins of the town’s coal plant and coke ovens are still visible a short walk away.

The residents here are used to seeing reporters, given how much coal has been in the news over the past two years, but many are done talking about it. Business owners hesitate to take a public side lest they alienate potential customers.

“It’s not worth getting into,” says one woman, who declines to give her name.

In 2020, the province moved to scrap a 1976 policy that limited coal development in the region. That temporarily lit a fire under the coal industry and the dream of more work in this community.

There’s clear support among many for the industry: affixed to a storefront is a sign that declares, “This is a coal community.” “I support the mines,” reads another.

Since then, in the wake of demonstrations on the steps of the Alberta Legislature and protest songs from country stars like Corb Lund, the rules have been put back in place, the coal projects put on pause.

Industry’s footprints on the land nearby, however, remain.

Aftermath of the Elk Valley coal mine
The aftermath of coal exploration is pictured in a drone photograph. (Locke Stock Creative)

These companies, many assuming they had the green light to plow ahead, commenced exploration work with the idea they would eventually end up establishing coal mines there. New roads were built and hundreds of drill sites were established.

All of this was done here, in an area that is home to endangered species and serves as traditional territory for Treaty 7 First Nations. It also contains the headwaters of rivers integral to the drinking water of Albertans.

Today, the financial futures of many of these companies involved are far from certain. Many are on life support. For some, there appears to be no clear financial plan.

Some of these companies may have expected their successful coal mines would fund reclamation work, the process that attempts to return the land to something resembling what it was before.

The silence since has left some in Coleman concerned about the future of the lands they’ve grown to love.

Heather Davis, the owner of a Crowsnest Pass-based outdoor guiding service, Uplift Adventures, has seen first-hand the impacts of industry on the land.

“When you fall in love with an area, and you’re really connected to an area, you just see that it’s degrading,” Davis said. “And it’s sad. It makes me want to cry when I see this beautiful area not being respected the way that it deserves to be respected.”

Heather Davis, owner of Uplift Adventures, a Crowsnest Pass-based outdoor guiding service, says she's frustrated to see the huge impact on the landscape as a result of coal exploration in the area.

So how far does the exploration stretch — and who’s going to clean it up? To start with, let’s go back to the beginning.

The 1976 coal policy

The 1976 coal policy carved up the landscape into four categories based on existing uses, whether they be mining, agriculture, environmentally protected wilderness or parks.

Roughly speaking, the categories tended to work in a gradient — protected areas in the west up against and in the Rockies in Category 1, areas farther east progressively more open to mining — but in certain regions such as the Crowsnest Pass, previous coal exploitation and pre-existing coal agreements led to a hodgepodge of zoning.

Coal exploration often takes place in very rugged, steep terrain. Take a drive on the backroads along the Crowsnest Pass and you’ll see, from a distance, some work that’s been done on these mountains, but also the effect on the lands from ongoing logging in the area.

Indeed, the roads extend up from Highway 3, a spine of partially developed roads up a centre mountain range sandwiched between protected mountain ranges on either side.

When the policy was removed, four companies came into this mountainous area and started building roads and drilling.

The work left a mark on the landscape, disrupting wildlife and allowing human activity in areas that would have otherwise been left alone, says the Canadian Parks and Wilderness Society (CPAWS), an environmental NGO.

Concerned over the effect of the exploration, CPAWS estimated the length of roads and number of drill sites in the area that would need to be remediated.

Comparing satellite imagery taken between 2017 and 2021, CPAWS estimated mining companies built approximately 80 kilometres of exploration roads in addition to 264 kilometres of roads that were already in place in 2017.

Based on the as-built information submitted by coal mining companies, the Alberta Energy Regulator (AER) says the built number is more like 40 km. It says that between 2017 and 2021, approximately 1,900 drill sites were approved for coal exploration programs, of which approximately 27 per cent were drilled.

Nevertheless, comparing satellite imagery is not an exact science and no other body or organization has done a comprehensive, on-the-ground survey of new roads in the area.

What is clear is that the landscape has been affected just by the exploration due to the policy reversal.

A thin layer of topsoil pushes down the hillside as debris from a coal exploration road in Cabin Ridge. (Lorne Fitch)

The new roads above Crowsnest Pass have created barriers for wildlife and streams as the hillside in this steep and hilly terrain has been carved out and disrupted.

Financial woes

Cam Gardner, a councillor with the Municipal District of Ranchland No. 66, gestures to the rolling hills behind him, wide and green. In Gardner’s view, there’s no amount of money on the planet that you could trade for these areas.

But he’s concerned about the future of the coal projects near this property, located southwest of High River, Alta., such as Cabin Ridge. In early July, the private coal company behind that project said it was seeking more than $3.4 billion in damages from the Alberta government, citing the province’s reversal on coal policy.

“Now that those companies appear to be paused, and because they’re operating in critical habitat that was previously protected under the coal policy, the municipality has real big concerns that Alberta taxpayers are going to be left holding the bag,” said Gardner.

Cam Gardner, a councillor with the Municipal District of Ranchland No. 66, has concerns that money hasn't been left behind to clean up the work done on nearby coal exploration projects.

Each mining company faces its own specific financial circumstances when it comes to reclamation work. Not too far from Gardner’s property is one of these projects put on hold.

Australian coal company Atrum Coal’s Elan Hard Coking Coal project is located on Category 2 lands, where the company holds extensive coal leases.

Atrum put its project on hold after the reinstatement of the 1976 policy. After the nearby proposed Grassy Mountain mine, located roughly seven kilometres north of Blairmore, was deemed “not in the public interest” by a review panel in June 2021, Atrum was undeterred and said it would continue pressing forward.

But the company’s share prices have dropped significantly since then, and have fallen off a cliff compared to its peak of nearly $1.95 AUD in 2013. On Aug. 24, the company’s shares were trading at $0.0090 AUD.

Atrum has been mum on its reclamation plans for its flagship asset. The company did not respond to requests by CBC News for an interview.

Though it was not listed as a liability before, in its 2021 report the company said it “decided to recognize” its reclamation liability on the Elan project, to the tune of slightly more than $2.2 million AUD.

And though the company now recognizes the liability, its current cash on hand raises serious concerns about its ability to complete that reclamation. In its January cash flow report, the company noted it had $1.8-million AUD on hand for future operating activities, representing an estimated 0.98 quarters of funding available.

Should that report be taken as accurate, the company would now be out of cash. In its annual report, the company says the group is expected to be cash-flow negative in the foreseeable future as a result of continued expenditures.

Carleton Osakwe, an associate professor of finance at Mount Royal University in Calgary, says it’s possible that Atrum could sell some of its exploration and evaluation assets to cover the liability.

“That said, the company’s low cash balance and low projected cash flows from operating activities indicate that without an external cash infusion (say through an equity issue), it may be difficult for the company to remain a going concern beyond 2022 unless their Elan project, which is currently on hold, is somehow able to begin production,” he said in an email.

Martin Olszynski, an associate professor in the University of Calgary’s faculty of law, says issues around reclamation hit the news around a year ago, posing some important questions for companies like Atrum.

“When would it be cleaned up? When would it be dealt with?” Olszynski said. “And what we’re seeing right now is that it still hasn’t been dealt with. And it’s unlikely to be dealt with this year. If at all.”

A systemic issue

Alberta grants exploration permits through the AER on a five-year term. That period includes two years to complete exploration, and up to three years for reclamation work.

When Alberta Energy Minister Sonya Savage announced the pause on exploration, her order said reclamation could proceed. According to the AER, reclamation of coal mining sites is up to the companies that own the mines. They must remove their infrastructure, abandon the site and return the land to a state comparable to what it was like before.

And the government assures Albertans that its Mine Financial Security Program (MFSP) is custom-built for situations like this: the program, the AER says, helps manage coal liabilities by collecting financial security from mining companies, protecting the public from paying for project closure costs.

But that program does not collect securities for exploration work. No liabilities have been collected by the AER for the work already done at the Isolation South, Cabin Ridge, Elan South and Tent Mountain projects.

“These companies are liable to complete reclamation and obtain a reclamation certificate within the specified timeframe. Failure to do so may result in further enforcement actions,” reads a statement from the AER.

Drone footage shows logging operations overlapping with coal exploration in Alberta. (Locke Stock Creative)

And though the province cites its MFSP as serving as protection against taxpayers holding the bag on liabilities, Doug Wylie, Alberta’s auditor general, has long been critical of the program and, in his view, the province’s failure to patch its leaks.

It’s been a systemic issue, Wylie wrote, especially when it comes to oilsands cleanup (as of Aug. 2, there were about 86,000 abandoned wells in the province, and the Orphan Well Association tracked 2,501 orphan wells for abandonment as of July 1), but also with coal mines.

In June 2021, Wylie said the government had failed to fix problems with the MFSP that his office had pointed out six years prior. There was confusion, he said, around who was responsible for the government’s contaminated sites that went beyond accounting and process issues.

Doug Wylie, Alberta’s auditor general, said that unless the province's Mine Financial Security Program is improved, the province could be at risk of paying "substantial amounts of public money." (CBC)

It led to funding issues, like when the AER hit a brick wall for reimbursement of costs tied to a coal mine near Grande Cache, Alta.

Inspectors there were very concerned in 2018 about a pond failing that contained selenium, which is natural and vital but is toxic in excess and can damage fish populations. It’s been linked to mass deaths of Westslope cutthroat trout.

The AER stepped in on an emergency basis to contain the problem, noting it had been nearly two decades since the mine had been abandoned. A stable funding stream was necessary to deal with the environmental risks that posed a potential threat to people and endangered species, the regulator said.

The environment ministry disagreed, arguing that because the AER regulates the coal industry, it was the AER’s job to pay up.

Or there was the time when the AER fixed sinkholes tied to legacy coal mines in southern Alberta. It did so using its operating budget, understanding it could use the provincial environmental protection fund to recover its costs.

But the AER was unsuccessful in getting that money back, and subsequently didn’t fix similar concerns tied to another legacy coal mine (a landowner later hired a lawyer to try to force the regulator to fix the sinkholes).

Though he’s not familiar with that specific instance, Lorne Fitch, a longtime fisheries biologist and former adjunct professor at the University of Calgary, says those legacy coal mines have “a bit of a habit” of collapsing.

“These underground shafts were connected through passages to allow air into them,” he said.

“Old mine workings have had a history of … creating these very dangerous holes in the ground where a person, if they’re not aware of it, could go for a long tumble and then probably die.”

A photo taken from the air of coal exploration roads that have yet to be cleaned up in Alberta.
A photo taken from the air of a drill site in Alberta. (Locke Stock Creative)

Without clarification and improvements to the MFSP, said Alberta’s auditor general, the province is at risk of having to pay “substantial amounts of public money” if a mine operator can’t fulfill its reclamation obligations.

Alberta’s coal policy committee anticipated that issues around reclamation were looming in its report released in December 2021.

The committee said the government should figure out who, in the end, had responsibility. It said some of these projects had exceeded their current financial securities.

Also, the committee said, there was a concerning detail that Alberta’s auditor general had flagged: that there had been a “significant risk” that asset values had been overstated within the MFSP.

“The committee understands that, of 19 coal mines required to provide financial security in 2015, only two have been subjected to detailed audits by provincial officials,” the report reads.

Gluing a mountain back together

On a sunny day in Coleman, fishing guide Matt Hodgson worries about the future of the Pass — not only its economy, but also the impacts of industry on the things he’s grown to love: tourism, fishing, hiking and mountain biking.

“It’s a little bit heartbreaking to come back and see more and more exploration roads and more trees taken down. And, you know, the wild is slowly disappearing out here,” he said.

Even in a situation where all the money was accounted for and the parties involved were clear on their directives, reclaiming these wild sites that Hodgson has grown to love is no easy task.

Fishing guide Matt Hodgson worries about the future of the Crowsnest Pass, an area of the province he's grown to love.

What becomes problematic is the difficulty in trying to “glue a mountain” together again after a bulldozer has pushed most of the material down a slope, says Fitch, the fisheries biologist.

“It’s very difficult to reassert the original slope. Part and parcel of that is that the very thin layer of topsoil has long since disappeared, so you’re left with mineral soil,” Fitch said.

“When you consider that it’s taken somewhere about 10,000 to 12,000 years to establish vegetative cover on the old existing soil, it would be a long time before you could get anything to grow.”

Fitch’s other concern involves sediment from the roads and trails being deposited into streams in the area, which could have an impact on nationally-designated threatened species, such as bull trout.

The province’s species at risk program has identified sediment as being among the most common, key threats to the population of bull trout in the province.

“The roads, which are bleeding sediment, are just an additive feature to all the other land use activities,” Fitch said.

“Logging and off-highway vehicle activity are already adding tremendous quantities of sediment to the water column, largely above the natural range of variability that these trout species have come to adapt to.”

Though it’s still unclear what will fund the reclamation work that needs to be done, an entirely separate consideration is the quality of that work, and whether things would ever really go back the way they were before.

The impacts of industry is of concern to members of Treaty 7 First Nations in the area.

“The landscape that was disrupted … it’s basically desecrated the ancestral lands,” said Adam North Peigan, chairman of the Piikani Mountain Child Valley Society.

“We’re deeply, deeply concerned about it. And somebody needs to be held accountable.”

Drone footage shows logging operations overlapping with coal exploration in Alberta. (Locke Stock Creative)

The provincial government says it is reviewing the MFSP, with results due at the end of 2022. It says it is reviewing water quality management frameworks, its management of selenium and is working with the Alberta Biodiversity Monitoring Institute to better understand the reclamation status of old roads, seismic lines and other features in the area.

The AER says exploration must adhere to approval conditions that companies must follow to minimize and mitigate impacts to the environment, wildlife, aquatic life and water resources, and reclamation must reach specific standards lest enforcement actions come into play.

Olszynski, the associate professor in the University of Calgary’s faculty of law, says issues around coal exploration — and who, ultimately, will clean up what’s been left behind — are all too familiar in a province that has frequently seen its liability regulations criticized by think tanks, research groups and by its own auditor general.

“You really need to stop and think and consider everything you’ve heard about natural resource development in this province over the past 10 years, and start to really wonder about the tired political lie that we engage in responsible resource development in this province,” he said.

“It’s fundamentally false. It’s fundamentally untrue.”

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