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Tar Sands, Saskatchewan

Extreme extraction plans rejected by local residents

by Sandra Cuffe

A sign for Cenovus' Axe Lake project. PHOTO: Sandra Cuffe
A sign for Cenovus' Axe Lake project. PHOTO: Sandra Cuffe

LA LOCHE, SASKATCHEWAN—La Loche is almost the end of the road in northwestern Saskatchewan, 600 kilometres north of Saskatoon. Even the kids play in Dene here. It’s one of the things other northerners describe about the place: some 90 per cent of the 3,500 people in the town of La Loche and the neighbouring Clearwater River Dene Nation still speak their language.

Heading north through the boreal forest on a road that leads to the Cluff Lake uranium mine, which shut down a decade ago, the flat lands give way to rolling hills. Exploration work continues around the string of lakes, but these days uranium isn’t the only thing resource companies are looking for. A hundred kilometres north of La Loche, no-trespassing signs now surround the Axe Lake tar sands project.

If industry has its way, Saskatchewan’s tar sands deposits may not remain under the sandy forest floor for much longer. Axe Lake is under new ownership, and two new exploration permits have been sold off to the highest bidder.

At an informal gathering with other Denesuline activists, Daniel Montgrand sits by the fire at a campsite he built near his late father’s birthplace on the Clearwater River, between La Loche and Axe Lake. From here, the river winds its way to Fort McMurray, where it flows into the Athabasca. The small clearing amid the jack pines feels like a world away, but it’s not far to the tar sands in Alberta: as the raven flies, it’s less than 150 kilometres from Fort McMurray.

Montgrand, a La Loche resident, first heard of tar sands plans for Saskatchewan in 1998. Ten years later, in 2008, La Loche municipal leaders signed a Memorandum of Understanding with Calgary-based Oilsands Quest Inc, the first owner of the Axe Lake tar sands concession. “There was no consultation held anywhere. They just went into one little office there and [signed the agreement]. They stole the land away,” Montgrand told The Dominion. “What’s happened in the north is they opened up a floodgate for the companies to come in and do whatever they want.”

Tar sands exploration in the area isn’t entirely new. Several wells were drilled in the 1970s, but the technologies to exploit the bitumen that lies 185 metres underground had not yet been developed. In June 2004, Texas company PowerMax Energy was issued an exploration permit for lands north of the Clearwater River covering 570,000 hectares—a concession the size of Prince Edward Island. Oilsands Quest acquired the permit from Petromax that same year.

After five years of work during which company contractors drilled more than 300 exploratory wells, Oilsands Quest embarked on formal application processes to build and operate multi-well pads for in situ production and a central processing facility. Their estimates pegged the resources at Axe Lake at 30,000 barrels per day for 25 years or more. Because of the depth of the deposit, extraction is complicated and costly. Following the 2008–2009 global market crisis, Oilsands Quest, a junior exploration company, couldn’t get the financing it needed to go ahead. The company filed for bankruptcy in Alberta in 2011, and in the US the following year.

Also in 2011, investors filed a securities fraud class-action lawsuit against Oilsands Quest and its directors, including Canadian Senator Pamela Wallin, alleging they intentionally overstated the value of bitumen resources. A $10.2 million settlement was reached in August 2013. By then, the project was already in the hands of a bigger player with deeper pockets, much less likely to face financing difficulties.

In October 2012, Calgary-based Cenovus Energy bought Oilsands Quest’s remaining assets—the 34,000-hectare oil sands permit in Saskatchewan containing the Axe Lake project, and the Raven Ridge and Wallace Creek leases in Alberta—for $10 million. The three blocks are adjacent to Cenovus’ Telephone Lake project in Alberta. According to the company, if Telephone Lake is approved, construction will begin in 2014.

Montgrand never did find out exactly what was contained in the agreement La Loche signed with industry. Even when he later became a town councillor, he was unable to obtain the document. “I keep telling them until today come out and tell the public,” he said, as the coffee percolated over the fire.

A stone’s throw away, multi-coloured ribbons flutter in the wind. They hang from a small wooden structure housing plaques dedicated to the memory of Montgrand’s parents. The memorial is the first of many, he said, to mark important places where the Denesuline have occupied the territory. To this day, people use the lands up to Axe Lake and far beyond, added Montgrand.

Local trappers say they have also been unsuccessful in finding out the deal’s content, and that they were never consulted about the Axe Lake project. A gate and fences around the project have cut off access to their traplines.

Some 200 kilometres to the south, tar sands exploration work is also underway.

Five oil sands special exploratory permits north of the Primrose Lake Air Weapons Range were on the auction block at Saskatchewan’s December 2012 sale of Crown petroleum, natural gas and oil sands rights. Two of the bids with a combined value of $1 million were accepted and exploration permits were granted for 200,000 hectares to Scott Land & Lease Ltd. The Calgary-based land services firm acquires surface rights, leases and permits on behalf of corporate clients in the extractive, energy and infrastructure sectors.

Neither the Buffalo River Dene Nation (BRDN) nor the two neighbouring communities, St. George’s Hill and Michel Village, were consulted or even notified about the new permits. “There was no consultation whatsoever,” BRDN Chief Lance Byhette told The Dominion. “Due to that fact, we decided to take the province to court regarding this because it’s in our traditional territory.”

On June 4, 2013, the BRDN began legal action against the Saskatchewan government, filing a judicial review application in the Court of Queen’s Bench. The failure to consult violates Section 35 of the Constitution Act of 1982, according to BRDN, since their members exercise Treaty rights within the areas covered by the oil sands special exploratory permits.

A hearing for the application has been set for November 12–13, 2013 in Saskatoon.

The lands permitted to Scott Land & Lease include hunting, trapping and plant harvesting grounds, as well as cabins, trails, traditional campsites and burial sites. The BRDN reserve is a mere 20 kilometres away. Local people don’t want to see the region turn into what they see in northern Alberta, said Byhette.

Neither does the Saskatchewan Environmental Society (SES). For the past five years, the SES has been advocating for a halt to any provincial permits or approvals for tar sands activities until a strategic regional environmental assessment for northwestern Saskatchewan is carried out.

“The sort of usual process of environmental assessment just looks at one development and the particular impact that that one development would have on a number of features of the environment, but the strategic regional approach is a much more comprehensive planning tool that I think would enable us to make better long-term decisions,” SES research advisor Ann Coxworth told The Dominion. A comprehensive assessment would take the natural features, sociology, economics, culture and so forth into account as a region, she said. SES maintains that the impacts of tar sands extraction go far beyond the individual projects.

A 2009 report produced by the SES, the Pembina Institute and the Canadian Parks and Wilderness Society found acid rain is both a threat and a current reality in the region. One estimate calculates 65 to 70 per cent of the acid-producing sulphur dioxide and nitrous oxide emissions from tar sands activity in Alberta is carried over into Saskatchewan by the wind.

Northern Saskatchewan has some of the most acid-sensitive soil in Canada, according to the 2009 report, citing forest soil research produced for the Canadian Council of Ministers of the Environment. “The terrain in northwestern Saskatchewan [is] very vulnerable to acid, just because of the nature of the geology. And so if there is an increase in acid rain, it could fairly quickly damage forests and lakes and fish. So I think it’s a really serious issue,” said Coxworth. New tar sands developments in Saskatchewan would likely compound the problem.

Studies or no studies, BRDN members say the impacts have already begun. “People do have concerns and the people that are always occupying the territory, they notice some different changes within the territory,” said Byhette. He went out onto the land with other BRDN members and elders to see some of the changes, including in the pines, for himself. Locals suspect acid rain from Alberta’s tar sands is largely to blame, he said.

With work at the Axe Lake project picking up again under new ownership and with the court challenge to the new exploration permits, the future of the tar sands in Saskatchewan remains uncertain. Byhette and others vow to protect their traditional territories. “We want to for sure maintain that for generations to come,” he said. “We don’t want to see that go. It won’t, is what it boils down to.”

Sandra Cuffe is a vagabond freelance journalist. She recently spent several months in northern Saskatchewan.

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Topics: Environment
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