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The Athabasca Chipewyan First Nation is suing Alberta’s energy regulator for not telling it for almost a year that water tainted with dangerous levels of arsenic and other toxins was seeping from the Kearl oil sands project into public lands and waterways near the community.

The nation, located in the province’s north, says in a court filing that the incident was not isolated, but rather a symptom of broader deficiencies in what it calls an “unconstitutional” legislative and regulatory regime for the management of mining waste, known as tailings, and other energy project approvals in Alberta.

The Alberta Energy Regulator and Imperial Oil Ltd. IMO-T, the company that owns Kearl, learned that the project’s tailings area was leaking in May, 2022. But neither of them informed the community until after a second incident on the site nine months later. In the second case, a drainage pond overflowed and sent an estimated 5.3 million litres of industrial wastewater laced with pollutants, including dissolved metals and hydrocarbons, into the environment about 70 kilometres north of Fort McMurray.

In Athabasca Chipewyan’s statement of claim, filed Tuesday in Edmonton, the First Nation argues that the AER had a duty of care to warn the community about the tailings flowing into lands and bodies of water that feed the Athabasca and Firebag Rivers. By failing in that duty, it says, the regulator harmed the First Nation’s ability to exercise its treaty rights safely.

Even as the province collected $50-million a month in royalties from the Kearl project, the regulator took no steps to notify the community about the contamination of land and water, or consult it about how best to mitigate the impact to members’ rights and way of life, it adds.

Ultimately, the regulator didn’t enforce licence conditions placed on Imperial Oil so it could operate the oil sands facility, the First Nation argues. The nation also alleges the AER knew that leakage was a possibility and had been aware of deficiencies in tailings management for years, but still failed to monitor Kearl in order to minimize risks.

The claims have not been proven in court.

Athabasca Chipewyan Chief Allan Adam told The Globe and Mail in an interview Wednesday that the incidents at Kearl have underscored the critical need for environmental regulatory reform – something his community has long asked for.

The lawsuit is a “game-changer,” he said.

“We’ve never had this kind of an opportunity to take the Alberta Energy Regulator to court before,” he said. “They’ve always walked a fine line. This time, they went and they stepped over the line.”

Among other remedies, Athabasca Chipewyan wants a declaration that the Crown caused a substantial weakening of the community’s traditional way of life. It’s seeking part of the royalties the government has earned from Kearl during the leak, and $500-million in damages.

“We’ve had enough,” Mr. Adam told AER president and chief executive Laurie Pushor on Tuesday night, at a fiery meeting about the issue in Fort Chipewyan.

The AER said in an e-mail it will be seeking legal advice about the lawsuit.

Several AER officials accompanied Mr. Pushor to the meeting, where residents demanded answers about what they contend is a lack of regulatory oversight of the oil sands.

“Fix the problem,” Mr. Adam said at the meeting. The AER is responsible for making sure the community is safe, he added, and “if you can’t do that, it’s time to shut down the oil sands.”

Kendrick Cardinal, president of Fort Chipewyan Métis, echoed the call to shut down the oil sands.

“As we speak right now, Imperial’s leaking. No matter what I say, no matter what you say, it’s still going to leak. It’s a joke. You can’t stop it,” Mr. Cardinal said.

Imperial spokesperson Lisa Schmidt confirmed on Tuesday that seepage at Kearl is still occurring, but she said various mitigation measures are preventing more water from moving off-site.

Ms. Schmidt said environmental testing to date has shown no indication of adverse impacts to wildlife or fish populations in nearby river systems, or risks to drinking water.

Although the AER hit Imperial with a non-compliance order and an environmental protection order over the incidents at Kearl, it maintained it was the oil company’s responsibility to inform the community about the leak – not the regulator’s.

Nevertheless, the AER board ordered a third-party review into aspects of its own response to the incidents at Kearl, including what it told Indigenous communities and other stakeholders.

That review, conducted by the accounting firm Deloitte, said the AER’s staff had adhered to the regulator’s policies and procedures in response to the spills. It placed the blame on the policies and procedures themselves, saying many are not in line with current standards. Indigenous leaders said the report did not go far enough in addressing problems that led to the incidents and kept people in the region largely uninformed about them.

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