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Teck Resources withdraws application for Frontier oil sands mine

Company cites uncertainty around Canada’s climate change rules

On February 23, 2020, Teck Resources officially withdrew its application to develop the Frontier Mine oil sands project. The $20.6-billion project would have been located between Fort McMurray and Fort Chipewyan in northeastern Alberta.

The Frontier oil sands mine was expected to produce up to 260,000 barrels of oil a day, and directly employ up to 7,000 workers during construction and up to 2,500 workers during operation. Teck signed support agreements with all 14 local Indigenous communities in the area, and in July 2019, a joint review panel of the Alberta Energy Regulator and the Canadian Environmental Assessment Agency determined the project to be in the public’s best interest and recommended it receive final approval from the Government of Canada.

In addition, Teck committed to achieving net-zero emissions, and was going to make Frontier a cornerstone of fostering innovation and new technology implementations.

However, Teck withdrew its application due to regulatory uncertainty connected to Canada’s climate change policies. In a letter to Jonathan Wilson, federal minister of environment and climate change, Teck CEO Don Lindsay said, “The global capital markets are changing rapidly and investors and customers are increasingly looking for jurisdictions to have a framework in place that reconciles resource development and climate change, in order to produce the cleanest possible products. This does not yet exist here today and, unfortunately, the growing debate around this issue has placed Frontier and our company squarely at the nexus of much broader issues that need to be resolved. In that context, it is now evident that there is no constructive path forward for the project. Questions about the societal implications of energy development, climate change and Indigenous rights are critically important ones for Canada, its provinces and Indigenous governments to work through.”

Tim McMillan, President and CEO of the Canadian Association of Petroleum Producers, said, “This withdrawal is another in a long list of major projects abandoned as a result of a complex and uncertain regulatory system, and Canada’s inability to see major projects to fruition. The lack of regulatory certainty damages Canada’s reputation as a reliable, productive nation that welcomes high-quality projects. Aside from being a serious blow to the oil and natural gas sector, the larger implication is that this could happen to any project. Next time it could affect a manufacturing, aviation, forestry or agriculture project.”