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The government says old system was excessively bureaucratic. Tailing ponds can be seen at the Athabaska Oil Sands north of Fort McMurray, Alberta in an aerial photograph Aug. 31/2010.(Photo by Kevin Van Paassen/The Globe and Mail)

Kevin Van Paassen/Kevin Van Paassen/The Globe and

The Harper government is preparing to allow oil sands and mining companies to cancel regulatory permits that require them to compensate for loss of fish habitat, critics charged Friday.

Under the budget omnibus bill tabled this week, companies will be allowed to apply to the fisheries minister who can either amend or cancel old permits – as well as the conditions that applied to them – if the minister "is of the opinion that the holder no longer need an authorization."

Critics say the bill, which also reduces federal protection for navigable waters, is part of an ongoing attack that is gutting the country's environmental laws.

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"What we see in Bill C-45 is a continuing pattern of removing regulatory hurdles to pave the way for tar sands and pipeline development," Jessica Clogg, executive director of the West Coast Environmental Law Association, said in an interview Friday.

"We fear this provision [in the act] will be used to allow tar-sands mining companies off the hook for promised compensation for lost or damaged fish habitat," she said.

Currently, resource companies have to receive federal authorization under the Fisheries Act when they intend to alter lakes and streams. When the damage will be severe, they are required to compensate by building new lakes or diverting streams.

Total E&P, for example, was granted federal approval last year to proceed with its Joslyn oil-sands mine. As part of a federal-provincial agreement, Total must build a lake on the property to provide twice the amount of fish habitat as will be lost. Imperial Oil Ltd. will build three compensation lakes at its Kearl oil-sands project now under construction.

Total spokeswoman Saphina Benimadhu said the company is a long way from completing the project design, but will stand by its commitment to compensate for the loss of habitat.

Prime Minister Stephen Harper and his ministers have defended the changes to the environmental review process – which was a major feature of both the current bill and last spring's version – by saying the old system was duplicative and excessively bureaucratic in requiring major reviews for minor issues. They say the changes are necessary to ensure the country can prosper from its resource bounty and access new markets.

New Democratic Party environment critic Megan Leslie said the precise impact of the legislation remains unclear until the government releases accompanying regulations. She noted the Conservatives have now amended the Fisheries Act twice in one year, and have still not released regulations that were required under the spring legislation.

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"What is clear is the fact that the Conservatives are making environmental policy on the fly," Ms. Leslie said. "It's like they can't gut Canada's environmental protections fast enough."

In a statement, an official with Fisheries and Oceans Canada said the amendment is meant to ensure that existing permits are consistent with the new regime adopted last spring, which lowered the threshold of what habitats need to be protected.

"If the minister deemed, after this review, that the authorization was no longer required under the new regime to protect Canada's fisheries, the minister may cancel that authorization," said Barbara Mottram, spokeswoman for Fisheries Minister Gail Shea.

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