Wrenches are being tossed into plans for a project to develop an estimated 820 million barrels of heavy oil in northwestern Alberta.
A former partner in the venture is trying to freeze the assets of the four remaining companies in the consortium, and the Lubicon Lake First Nation, an economically deprived, but politically hard-nosed community, is calling for an assessment of the environmental, social and economic impacts before any approvals are granted.
The corporate showdown is pitting I.G.M. Resources against Deep Well Oil & Gas, the lead partner in the Sawn Lake project, along with Classic Energy, Nearshore Petroleum and 97908 Alberta (a private numbered company).
I.G.M. is seeking compensation for what it alleges is “unjust enrichment,” accusing the defendants of improperly using well data and related information from the lease.
Meanwhile, Lubicon Chief Bernard Ominayak has contacted federal Environment Minister Stéphane Dion and Indian and Northern Affairs Minister Andy Scott in a bid to get a full panel assessment of the Sawn Lake plans, saying it would be irresponsible of the Canadian government to let the project go ahead without resolving a 66-year Lubicon land claim.
Because the Sawn Lake property is close to Lubicon land, the First Nation is worried about the affect on surface and ground water reservoirs, given Deep Well’s plans to drill more than 500 wells.
Adding to the concerns is the prospect that once the heavy oil has been removed, the companies could move to an oil sands project, using steam-assisted gravity drainage technology and posing a threat to the area’s water supply.
The Lubicon attracted global attention in 1988, during the Winter Olympic Games in Calgary, when they blockaded roads close to their community, closing access to oil companies.
It required members of the Royal Canadian Mounted Police, carrying machine guns, to end the blockade.
The community’s attempt to negotiate a settlement on land, compensation and self-government has been stalled for the past year since the federal government left the negotiating table.
Deep Well’s chairman is Horst Schmid, a former Alberta cabinet minister. One of the company’s s directors, Len Bolger, was president of Shell Canada Chemical Co. in the 1980s and is currently co-chairman of the Alberta Energy Research Council and chairman of the Alberta Oil Sands Technology and Research Authority.
—Gary Park
