It’s one of Alberta Premier Jason Kenney’s pro-oil-patch applause lines: Ottawa must approve any and all energy projects, and quickly.
But according to one small oil company, the Premier’s United Conservative Party government is not living up to that standard when it comes to its own approvals.
Prosper Petroleum Ltd. applied to build a small oil sands project northwest of Fort McMurray, Alta., in 2013 – the same year Trans Mountain filed for the massive expansion of its oil pipeline to the West Coast. Trans Mountain’s project, seen as key to the industry’s export hopes, is finally under construction after numerous delays, including a court decision quashing the initial federal approval.
Not so for Prosper’s oil sands proposal, known as Rigel. The Alberta Energy Regulator (AER) ruled in June, 2018, that the project is in the public interest. The file has since languished on the cabinet table of two successive governments – first, NDP Premier Rachel Notley’s and now Mr. Kenney’s – with no final go-ahead decision and no explanation why.
The privately held company, which describes itself as 95-per-cent Albertan, is worried its future as a going concern is at “serious and imminent risk" as the wait goes on. So on Tuesday, it will take the rare step of asking a judge to force the government to make a decision on whether Rigel should proceed.
Prosper’s partner in the proposal is a subsidiary of Lama Energy Group, based in the Czech Republic. With a capacity of 10,000 barrels a day, it is not a major development by oil sands standards.
There are complications, however, and it appears no government, regardless of political stripe, wants to deal with them. Prosper faces opposition from an influential Indigenous community, and one that is typically among the most supportive of oil sands development.
Fort McKay First Nation runs several businesses to support the oil sands, including fuel supply and hauling, vehicle fleet maintenance and leasing companies. Its corporation says its revenue in 2018 was $500-million.
But in this case, Fort McKay says the project would encroach on its territorial lands near a small water body called Moose Lake. The First Nation has been involved for years in the development of an access management plan for the region, saying it wants a process to make sure development is orderly and that the area’s ecological and cultural integrity is protected.
In October, Fort McKay launched an appeal of the AER’s approval, arguing that the project’s facilities come too close to Moose Lake, where it has called for a 10-kilometre buffer zone.
This is where things get thorny for the UCP. Various Indigenous groups in British Columbia have opposed pipeline developments, and Mr. Kenney has said that they should not be allowed to hold up the projects that otherwise have support, including from other First Nations.
A look at an affidavit from Prosper’s chief executive officer Brad Gardiner shows a long and circuitous process to first win AER approval, then seek an order in council from the cabinet. The company has spent $65-million through the process, according to Mr. Gardiner.
He lists the many times in the past year and a half that he and his colleagues have written, first to then-NDP energy minister Marg McCuaig-Boyd, copying Ms. Notley, then, after the UCP was elected last spring, to Mr. Kenney and Energy Minister Sonya Savage. Mr. Gardiner urged the politicians as well as senior bureaucrats to make a decision. He variously was told that a decision was coming, or he was, in modern parlance, ghosted.
One final exchange concerns Mr. Gardiner’s efforts to meet with UCP Environment and Parks Minister Jason Nixon late last year to discuss the access management plan for Moose Lake and the project. His regulatory adviser’s e-mails with Mr. Nixon’s executive assistant show, first, warnings that the minister’s calendar was very tight, then following Prosper’s insistence, an invitation to meet with him in early December.
That meeting was subsequently cancelled by the minister’s office, citing “legal issues surrounding this topic that [the] minister is not, at this point, able to discuss."
Jess Sinclair, Mr. Nixon’s spokeswoman, declined to elaborate on the legal snags, saying that the matter is before the courts.
The answer could come at the court hearing on Tuesday. But as the Prosper case shows, the UCP’s get-tough approach on energy has its limits, even within its provincial boundaries.