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The federal government will be required to answer questions as to how it is protecting Canadian taxpayers and the environment as part of its review of Glencore’s takeover of coal mines in British Columbia’s Elk Valley, thanks to a legal petition filed this week by Wildsight and Ecojustice.
The Swiss-based mining and commodity giant’s US$6.9 billion acquisition of the mines from Canadian-owned Teck Resources was announced last November, but is subject to the federal government’s approval under the Investment Canada Act.
“This petition will legally oblige the government to answer questions regarding how its final decision factors in the significant and foreseeable liability to taxpayers around the cleanup of these mines,” says Casey Brennan, Wildsight Conservation Director.
The multi-billion dollar pollution cleanup at stake
Selenium-contaminated run-off from the five Elk Valley coal mines has caused an international water pollution crisis, impacting waterways from the B.C. towns of Sparwood and Fernie to communities across the border in Montana and Idaho.
A landmark 2023 study authored by U.S. Geological Survey scientists found selenium concentrations in the Elk River jumped 551%, nitrates climbed 784% and the concentration of sulphates spiked 120% from 1979 to 2022.
In March, a Wildsight-commissioned report revealed that taxpayers could stand to pay billions of dollars for the cleanup of that pollution due to insufficient reclamation securities held by the B.C. government.
What is a reclamation security in mining?
A reclamation security is a financial assurance, often referred to as a bond, that mining companies must provide to the province to cover environmental reclamation and remediation costs in case of insolvency or emergency. It is designed to ensure the financial burden associated with cleanup costs falls on industry rather than taxpayers.
“The financial risk to taxpayers will increase exponentially if ownership of these mines passes from Canadian owned Teck Resources to Glencore, a foreign entity that has publicly declared its intention to spin-off the mines within two years of the sale going through,” Brennan says. “We want to know how Ottawa is factoring that risk into its decision making, and what it’s doing to make sure polluters, not taxpayers, pay.”
Petition questions require govt consideration and response
The joint Wildsight-Ecojustice petition was submitted to Canada’s Commissioner of the Environment and Sustainable Development Jerry DeMarco on Monday after being prepared by Ecojustice lawyers with support from Wildsight.
“Pursuant to Section 22 of the Auditor General Act, Commissioner DeMarco is legally obliged to pass our petition on to the federal government,” says Fraser Thomson, Ecojustice staff lawyer. “From receipt of the petition, the appropriate ministers must consider and respond to all eight questions posed by it within 120 days. This process will force the government to respond on the record for all to see,” says Fraser Thomson, Ecojustice lawyer.
“Is the government carefully considering how Glencore’s takeover will impact Canadian taxpayers, species and landscapes? How is it factoring Glencore’s environmental track record into its decision? To what extent has it assessed Glencore’s human rights track record under international agreements such as UNDRIP? These are all questions that we hope to get answers to,” Thomson says.
Glencore’s controversy-ridden history
Glencore’s operations, and that of its subsidiaries, have been the subject of controversies around the world. Last year, a report from the Business and Human Rights Resource Centre outlined 70 allegations of human rights abuses against mining projects Glencore was involved with over 12 years.
In 2022, Glencore Ltd and Glencore International A.G. pleaded guilty to foreign bribery and market manipulation schemes across the United States, the United Kingdom and Brazil.
As of 2023, Glencore’s Horne Smelter in Quebec had released so much arsenic into the air that a decision was made to move 200 neighbouring homes, at a cost of $88.3 million to the provincial government. Children living near the smelter were found to have arsenic levels on average four times higher than children in a neighbouring town.
In Montana, the government ordered the long-term cleanup of Glencore’s shuttered Columbia Falls Aluminum Company Plant, a project that estimates from the EPA suggest could cost between US$624 million and US$1.4 billion. It does not appear that any clean up of this site has occurred.
Placing conditions on the sale to protect taxpayers and the environment
A final decision is expected on Glencore’s proposed takeover within the next few months. At a minimum, Wildsight and Ecojustice hope the federal government will place conditions upon the sale that require Glencore to post adequate reclamation securities. This would help to protect taxpayers, the environment and local communities in the Kootenay watershed.
