Alberta to Rescind Coal Development Policy

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Bennett Jones LLPEffective June 1, 2020, the Government of Alberta is rescinding A Coal Development Policy for Alberta, also known as the 1976 Coal Policy. The effect of this rescission will be to remove the land use classification system which consisted of the following four coal categories:

Category 1: in which no exploration or commercial development will be permitted. This category includes national parks (current and proposed), wilderness areas, natural areas, restricted development study areas, watershed research study basins, designated recreation areas, designated heritage sites, wildlife sanctuaries, settled urban areas and major lakes and rivers.

Category 2: in which limited exploration is desirable and may be permitted under strict control but in which commercial development by surface mining will not normally be considered. This category includes lands in the Rocky Mountains and Foothills.

Category 3: areas in the Northern Forested Region and eastern portions of the Eastern Slopes region, and class 1 and class 3 agricultural lands, where exploration is desirable and may be permitted subject to proper assurances respecting protection of the environment and reclamation of disturbed lands and confirmation that the infrastructure is in the public interest.

Category 4: all other areas not covered by the previous three categories where exploration is desirable and may be permitted subject to proper assurances respecting protection of the environment and reclamation of disturbed lands and confirmation that the infrastructure is in the public interest.

The prohibition against coal activities within public lands formally designated as coal category 1 will remain. However, all restrictions on issuing coal leases within the former coal categories 2 and 3 have been removed and coal exploration and development activities can now be pursued more readily on these lands subject to applicable land use plans. The existing regulatory approval requirements for coal project development in Alberta remain in effect.

The removal of the restrictions in relation to former category 2 and 3 areas obviously has a direct impact on existing coal lease applications. As described in more detail in Coal Information Bulletin 2020-2 issued on May 15, 2020, proponents with active coal lease applications will be offered a right of first refusal by Alberta Energy. Specifically, Alberta Energy will be issuing notifications to proponents with a listing of their eligible coal lease applications and the option to either proceed to lease or cancel the application. A response is required within 60 days of the date of the notice and a failure to respond will result in lease cancellation. Effective May 15, 2020, Alberta Energy placed a 120-day moratorium on all new applications for coal rights while it resolves all existing coal lease applications.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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