Teck CEO Don Lindsay
Diversified major Teck Resources CEO Don Lindsay on Sunday announced the group’s “difficult decision” to formally withdraw its Frontier oil sands project from the federal regulatory review process.
As a result, the major announced it would write down the C$1.13-billion carrying value of the Frontier project.
The announcement comes only days before Prime Minister Justin Trudeau’s government was meant to decide on the fate of the C$20.6-billion project. At 260 000 bbl/d of crude oil, Frontier would have been one of the largest oil sands mines in Alberta and commentators have warned that approving the project, could call into question Trudeau’s commitment to reduce the country’s greenhouse-gas emissions to net zero by 2050.
In a letter addressed to Environment and Climate Change Minister Catherine McKenna, Lindsay said it was disappointing to “have arrived at this point”.
“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,” he said.
Lindsay stated that Teck was not “merely shying away from controversy”, adding that the mining company was prepared to face opposition from a “vocal minority that will almost inevitably oppose specific developments”. However, Frontier had brought forward a broader debate over climate change and Canada’s role in addressing it.
“It is our hope that withdrawing from the process will allow Canadians to shift to a larger and more positive discussion about the path forward. Ultimately, that should take place without a looming regulatory deadline.”
Lindsay stressed that resource development and reducing global carbon emissions did not have to be in conflict, noting that a transition to a low-carbon future could also include low-carbon energy produced from Alberta’s oil sands by employing best-in-class technology.