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The province faces a lawsuit of more than $3.4 billion over its decision to end all new coal-related exploration on the eastern slopes of the Rocky Mountains.
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Calgary-based Cabin Ridge Project Ltd. and its parent company, Cabin Ridge Holdings Ltd., say the March decision amounted to an effective expropriation of “their freehold mining rights and coal leases.”
“Cabin Ridge and CRHL acquired the Cabin Ridge Property and additional property interests (including an oil pipeline and right-of-way leading to a railroad)…for the purpose of developing a major coal metallurgical (steelmaking) project of the world,” a statement in the lawsuit filed in Calgary Court of Queen’s Bench says.
“The Cabin Ridge Project would have created about 500 jobs, provided $2 billion or more in taxes and other revenue for the provincial and federal governments, and generated approximately $9 billion in pre-tax profits.”
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The court document says Cabin Ridge paid about $56 million to acquire, invest and take steps to explore and develop the property, which is designated a Category 2 property under a 1976 provincial coal policy.
“Cabin Ridge owns the rights to coal resources on approximately 4,700 hectares of land located approximately 50 kilometers north of Coleman, Alberta.”
The complaint says that despite the province’s actions, no compensation has been offered to the companies for their losses.
“Despite Alberta’s immediate, indefinite and complete ban on coal exploration and development on the Cabin Ridge Property, Alberta has not compensated or offered to compensate Cabin Ridge or CRHL,” it says.
The lawsuit notes that on May 15, 2020, the province announced that it would rescind the 1976 coal policy, prompting Cabin Ridge to take additional steps to acquire the property and assets and further explore and develop the project.
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“Cabin Ridge relied on Alberta’s rescission of the 1976 coal policy and proceeded with the understanding that there were no unique restrictions to developing a metallurgical coal project, apart from the restrictions that applied to other industrial users, including regulatory approval requirements.
The company then proceeded to obtain permits from the Alberta Energy Regulator for coal exploration and deep drilling before the province reinstated the 1976 coal policy eight months later, followed by ministerial instructions and an order prohibiting drilling. mining on the top of the mountain and indefinitely suspended coal exploration on the eastern slopes. .
“In doing so, Alberta has de facto expropriated the Cabin Ridge Property by depriving Cabin Ridge of all reasonable uses of that property, including proceeding with the Cabin Ridge Project, and has rendered both the property and the project assets worthless.” .
The lawsuit seeks $3.441 billion in damages, or alternatively restitution of about $56 million plus contingent and future remediation costs.
A defense statement challenging the unproven allegations in the lawsuit has not been filed.
On Twitter: @KMartinCourts
