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A aerial view shows the Mount Polley mine near the town of Likely, B.C., on Aug. 5, 2014.JONATHAN HAYWARD/The Canadian Press

One of the little-known casualties of the Mount Polley mining disaster was a proposed new mine hundreds of kilometres away, its fate left in limbo since the tailings pond dam collapsed.

When the provincial government releases a report Friday on the cause of the massive breach at Mount Polley, it will be forced to reconsider its decision on the Morrison mine project.

In the fall of 2012, British Columbia refused to issue a certificate for the Morrison copper-gold mine, despite the fact a government report had concluded it would not result in significant adverse effects if mitigation measures were followed. It was a surprising decision from a pro-resource government that had systematically streamlined regulation and reduced oversight to encourage investment. Suddenly, the industry was questioning whether the ground rules for mining in British Columbia had changed.

A B.C. Supreme Court judge overturned the government's decision in December, 2013, saying the province had failed to meet the requirements of procedural fairness. At the time of the original decision to reject the Morrison mine, then-environment minister Terry Lake explained that his government had applied new "risk versus benefit" criteria that the proponent, Pacific Booker Minerals Inc., failed to meet.

The government was required to reconsider the Morrison mine application and had just about reached the deadline for a decision when the massive dam holding the toxic waste water from the Mount Polley copper-gold mine collapsed, spilling eight million cubic metres of tailings into Polley Lake and Quesnel Lake.

In the wake of that environmentally devastating failure, the province launched three investigations and on Friday will release the results of one of them – an expert panel review of the technical reasons for the breach. As that report is tabled, the clock starts ticking once again on the Morrison mine decision.

"Any decision on the proposed project should be informed by the outcome of the review panel's work," Environment Minister Mary Polak told Pacific Booker's management in a letter two weeks after the Mount Polley incident. "I plan to make a decision on the proposed project within 30 days of the outcome of the review panel's work."

Now, Ministry of Environment officials say there could be further delays. The Environmental Assessment Office will need to review the panel's report, an official said Thursday, to determine whether and how it applies to the environmental assessment of the Morrison mine. There is no set timeline for a final decision.

Gavin Dirom, president of the Association for Mineral Exploration B.C., said the province has been moving in a positive direction to encourage mining over the past decade, and he applauded the announcement this week that the province has doubled the budget for the department responsible for permitting new mine projects.

But the decision on the Morrison mine, worth close to half a billion dollars in investment, was a setback for the investment climate, and that needs to be fixed, he said.

"Sometimes it is three steps forward and one back, and this is an example of that," Mr. Dirom said in an interview Thursday.

In 2011, Premier Christy Clark announced a jobs plan that included the promise of eight new mines by 2015. To date, five mines have opened, creating 1,300 jobs. Three more, including the Red Chris mine (owned by Imperial Metals, which also owns the Mount Polley mine) are expected to open before the end of the year.

The B.C. Liberals may not need the Morrison mine to meet their stated target, but given the rebuke from the Supreme Court about fairness, and the lengthy delay, the industry will be watching closely to see what happens next. "This one has to be addressed," Mr. Dirom said. "Clearly the process was not functional and it needs to be remedied."