Stelmach decision worries oilpatch
Industry wonders if cancelling Marie Lake permits for bitumen mining hints at new rules for future
http://www.canada.com/edmontonjournal/news/cityplus/story.html?id=9b00c5...
Archie McLean, The Edmonton Journal
Published: 1:50 am
EDMONTON - Premier Ed Stelmach's decision to halt seismic testing at a northern Alberta lake is raising concerns in the oilpatch over what it means for future projects.
"Does this set precedent, or is this a one-off kind of decision?" asked David Pryce, a spokesman for the Canadian Association of Petroleum Producers.
Pryce said industry needs to know how such decisions will be made in the future.
"What we're looking for is a signal that the existing process does actually exist and will prevail in time," he said.
"That's what's important for industry. That will give us the certainty we need and the confidence we're looking for."
Stelmach said his decision applies just to Marie Lake. "This is only one lake, with a process for extracting bitumen that was new."
He said the province needs a new way to make decisions on such matters. Seismic testing on provincial lakes has gone on for years, but mining bitumen underneath them is new.
Testing at the picturesque lake 300 kilometres northeast of Edmonton was approved by Alberta Sustainable Resource Development last month.
The department put environmental restrictions on the testing, which uses underwater air guns to help assess the amount of bitumen under the lake.
Residents, cottagers and local Tory MLA Denis Ducharme were furious. They said the project threatened the ecological integrity of the lake and they decried the government's attitude towards development.
Sustainable Resource Development Minister Ted Morton said he couldn't go back on the decision because it followed government procedures.
Late Tuesday, after meeting with Ducharme and Morton, Stelmach changed course.
He said the decision doesn't reflect badly on Morton, who was simply following government rules.
"It shows that I'm keeping my word and trying to find a balance between continued economic growth, developing our resources, and the environment," Stelmach said.
Oil Sands Underground Mining (Osum) Corp., bought the 25-square-kilometre lease last year.
Even if the testing had gone ahead, Osum would have had to apply to the Alberta Energy and Utilities Board to extract the bitumen.
In a statement Wednesday, Osum chairman and CEO, Richard Todd said he was surprised by Stelmach's decision.
"Industry has performed seismic testing on more than 30 lakes in Alberta without negative impact, and the Alberta government's Sustainable Resource Development department previously approved the seismic application," Todd said.
"In our opinion, a decision such as this can have significant negative industry impact and implications well beyond our proposed seismic program at Marie Lake."
NDP Leader Brian Mason said Stelmach made the right choice. But he said it shows flaws in the government's system for granting leases.
"There is no opportunity for public input before a lease is given," Mason said.
"These leases are given and people then have an expectation that they can extract the resources that they've just bought. So it creates an enormous contradiction in the system."
amclean@thejournal.canwest.com
© The Edmonton Journal 2007
