First Nation launches legal action over Alberta oilsands cleanup fund

A First Nation in northeast Alberta is challenging the provincial government in court over its approach to ensuring oilsands companies pay to clean up their operations.

The Athabasca Chipewyan First Nation filed an application this week for a judicial review of the province's 2024 decision to renew the rules for the Mine Financial Security Program (MFSP), saying it failed to meaningfully consult and is ignoring ACFN's concerns about infringement on Treaty rights.

The program collects deposits from energy companies to make sure they cover the cost of remediating oilsands and coal mine sites after they're decommissioned.

About a third of ACFN members live in the community of Fort Chipewyan, Alta., downstream from oilsands operations.

The ACFN's legal application, filed on April 1, argues the MFSP is "grossly inadequate for achieving its intended purpose," and the province hasn't addressed recommendations and concerns raised during a recent review.

"Without a properly funded program, industry will be able to walk away from their leases — leaving the mess behind for First Nations communities to live with," acting ACFN Chief Hazel Mercredi said in a statement.

The MFSP was criticized in 2021 by provincial auditor general Doug Wylie, who found that the government holds just $1.5 billion in security on mining liabilities of $31.5 billion.

A subsequent report from researchers at the University of Calgary's School of Public Policy in 2023 estimated liabilities at anywhere between $45 billion to $130 billion, with just $2 billion in reserve.

Ryan Fournier, press secretary for Environment Minister Rebecca Schulz, told CBC News in a statement that the province made "effective changes" to the MFSP last year.

"These were designed to ensure mine operators provide security to cover reclamation without unfairly targeting the energy sector."

Fournier said the government is reviewing ACFN's legal action, but can't comment further while it's before the courts.

Environmental law organization Ecojustice is representing ACFN. 

Ecojustice lawyer Matt Hulse said their position is the government is failing in its obligations to ACFN under Treaty 8.

"We're also saying the decision is unreasonable because keeping such a flawed program does not actually uphold the purposes of Alberta's environmental legislation."

The legal application asks for action including a declaration that the province breached its duty to consult ACFN, and an order to amend the MFSP within six months, addressing the Nation's concerns.

It also seeks a judge's order requiring the province provide ACFN "an independently verified estimate of total oilsands liabilities and supporting analysis."

The judicial review is scheduled to be heard in the Fort McMurray Court of King's Bench on May 21.

ACFN also filed a lawsuit last year against the Alberta Energy Regulator, alleging negligence and a failure to live up to Treaty obligations after multiple tailings leaks at Imperial Oil's Kearl facility.