Alberta legislature resumes: Focus on jobs and bill to punish protesters

Marco Green
February 26, 2020

Chris Stannell, a spokesman for Teck, said in an email that the company is evaluating "improvements to project technology and other operational improvements" that it believes will make the Frontier project "technically feasible and commercially viable".

The corporation issued a letter by Teck CEO Don Lindsay to Canada's environment minister, stating Teck was "disappointed to have arrived at this stage".

"Global capital markets are changing rapidly and investors and customers are increasingly looking for jurisdictions to have a framework in place that reconciles resource development and climate change, in order to produce the cleanest possible products".

"It is our hope that this withdrawal will help create both the space and the impetus for this critical national discussion to move forward". Ultimately, that should take place without a looming regulatory deadline.

The Frontier project, valued at $20 billion, would have created 7,000 construction jobs, 2,500 operating jobs, and brought in more than $70 billion in government revenue over a 40-year period.

The federal-provincial panel acknowledged that the Frontier mine might "make it more difficult" for Canada to achieve its domestic and worldwide greenhouse gas emissions commitments, but it did not take that into account when making its recommendation.

Fourteen First Nations and Metis communities had signed participation agreements with the company on the mine, some of which expressed shock at the decision.

Teck's determination is a "wake-up name" to Alberta Premier Jason Kenney for not drafting a plan to decrease the province's general emissions, an individual conversant in the project mentioned. The impact was tempered because the overall uncertainty around the project had been priced into the stock already, analysts said.

Teck said on Sunday it would write down the C$1.13 billion ($852.12 million) carrying value of the project.

Teck originally expected a decision from the federal cabinet by the end of the month.

So just what is Canada's policy on resource development and climate?

Teck, in a Sunday letter to the federal environment minister, cited political discourse over climate change as a reason for withdrawing its application for Frontier. "Without serious improvement, it will not be the last".

Prior to Teck announcing its decision, officials with the Alberta Environmental Network (AEN), of which ReThink Red Deer is a member, published an open letter on behalf of 18 Alberta environmental and community groups urging federal environment and climate change minister Jonathan Wilkinson to not approve the project.

The reluctance of Canadian law agencies to provide similar enforcement for approved projects is another competitive disadvantage, she added.

Levin also said that the Frontier Mine was unlikely to ever have been built, given that it would only have been profitable at oil prices much higher than forecasts show.

Keith Stewart, senior energy strategist at Greenpeace Canada, said in a statement that it was "phantom project" given the current economic and climate sense.

"We are finally seeing a decline in absolute emissions and projections are on a downward trend", he said.

The Frontier Project was set to produce some 260,000 barrels of oil a day.

The only way to make such a costly development project work financially would be through even more government subsidies, Bronwen Tucker, an Edmonton-based analyst for Oil Change International, told Earther in an email. "Canada must decide whether the rule of law and fair consultation will prevail, or a radical minority".

The project is dividing Trudeau's caucus, as well as the broader Canadian public. "The Teck decision is a huge win".

Frontier's cancellation appears to be, at least in part, the result of Canada's indecision on the question of whether it can - or wants to - continue developing and exporting fossil fuels, while implementing strong climate change policies and addressing First Nations reconciliation, and Teck does not want the Frontier project to be caught in that indecision.

Other reports by Click Lancashire

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