Alberta taxpayers hit with $143M bill in first of multiple coal policy settlements

Alberta taxpayers are on the hook for more than $140 million, as the province settled one of five lawsuits filed against it over coal mining policies.

The Alberta government’s multimillion-dollar settlement with a coal company is drawing backlash from environmental groups, opposition MLAs and Indigenous leaders, who say the payout reflects years of policy flip-flopping that left taxpayers on the hook.

Five coal companies were part of a $16-billion legal action launched after the province abruptly reversed its coal policy multiple times between 2020 and 2024.

In 2020, the province nixed land protection rules that dated back to 1976, prompting public backlash which forced the UCP government to reverse its decision the following year.

The government then cancelled leases which were earmarked for potential new mines and declared an indefinite moratorium on coal exploration.

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That decision did not sit well with Atrum Coal Limited, one of the plaintiffs in this lawsuit which was the first to disclose a settlement publicly, confirming in a statement this week that it had reached a $142.8 million agreement with the province.

The agreement includes $6 million being withheld until the company completes site reclamation.

Other companies involved including Evolve Power Ltd. have also reached a settlement but have declined to comment further at this time on what the amount is.

Cabin Ridge Project Ltd., Black Eagle Mining Corp., and Northback Holdings Corp. are the other companies involved in the lawsuit which have yet to reach an agreement with the province.

“Atrum has stated they will surrender all their Alberta coal leases to the Government of Alberta,” Energy Minister Brian Jean said in a statement to CTV News.

“These leases are in Category 2 lands under the 1976 Coal Development Policy. The government has no intention to further lease these rights Atrum has stated it will complete necessary reclamation works as part of the settlement, this will support our stated commitment to protect the foothills and Rocky Mountains.”

The province says additional agreements are still being finalized but declined to share further details.

Opposition slams province

“This latest payout is another example of how this UCP government doesn’t know what they’re doing,” said Alberta NDP Leader Naheed Nenshi.

“Taxpayers are on the hook for nearly $150 million, directly as a result of this government’s flip-flopping on their coal policy.”

“We also don’t know how much more taxpayers will have to pay,” Nenshi added. “The government has announced none of these settlements itself. We are only hearing from the coal companies.”

“The terms of these settlements remain privileged, and we cannot discuss details related to the settlements, related discussions or any other active litigation at this time,” Jean said.

Alberta Environment Minister Rebecca Schulz said her ministry is also focused on improving policy certainty for industry.

“The work being done on the coal Modernization Initiative is really to make sure that we do have policy certainty moving forward,” Schulz said. “We take our environmental standards very seriously.”

Concern over long-term impacts

Sarah Elmeligi, the NDP’s shadow minister for environment, said the government’s approach has caused widespread confusion in industry and the public.

“The government has created a complete disaster of this coal file,” Elmeligi said. “Flip-flopping and poor consultation has led to a lot of confusion in the sector.”

“When the coal policy was rescinded, companies started putting in development applications,” she said.

“But then those applications were not valid anymore when the coal policy was put back in place and now Alberta taxpayers have to pay $148 million in this one settlement. That’s money that could have been spent on health care or hiring educational assistants, improving our education system, or reducing surgical wait times.”

Environmental groups also raised questions about the long-term consequences.

“It’s really unclear how the settlement amount was calculated,” said Katie Morrison, Executive Director of CPAWS Southern Alberta.

“Is the government just bowing to coal companies and paying them off with public funds much beyond what they’re actually owed?”

Morrison said companies are already “years behind on their reclamation requirements” and questioned whether the $6 million holdback is sufficient.

“That could become a public liability,” she said.

Nicole Johnston, a member of the Piikani Nation, said the lack of formal disclosure from the province raises broader concerns about accountability.

“It wasn’t long ago when Danielle Smith stated how she was protecting the taxpayers from lawsuits when they lifted the ban on the eastern slopes,” Johnston said. “But the lawsuits didn’t go away and now this settlement is also going to be taking away from the taxpayers.”

“She’s just trying to go out of her way to take to cover the mistakes and the decisions she’s made, which is not good for the people in Alberta,” Johnston said.

Northback Holdings, another company with a coal project in the Crowsnest Pass, also filed a separate lawsuit earlier this year.

In a brief statement, the company said it remains committed “to developing high quality steelmaking coal in Alberta, adhering to the highest environmental standards while delivering economic benefits to Albertans.”

Evolve Power, another firm involved in the original joint lawsuit, declined to comment.

Elmeligi said the fundamental issue remains unresolved.

“We don’t have a government that has made it clear and has taken a clear position that there should not be coal mining on the eastern slopes,” she said. “We need a government that will just say no.”