2013 Year in Review - Alberta Energy

Coal and Mineral Development in Alberta
2013 Year in Review
Coal mining and projects
Metallic and industrial mineral activity
Land-use planning
Industrial mineral and coal production and royalty
Mineral assessment reports
Alberta Energy
Resource Revenue and Operations Division
Coal and Mineral Development Branch
North Petroleum Plaza
9945-108 St NW
Edmonton, AB T5K 2G6
Phone: 780-427-7707
Fax: 780-422-5447
Email: [email protected]
Web: www.energy.alberta.ca/OurBusiness/minerals.asp
www.energy.alberta.ca/OurBusiness/coal.asp
All Alberta Acts and Regulations are available online:
www.qp.alberta.ca/Laws_Online.cfm
Permit and Leasing Toolkits
www.energy.alberta.ca/minerals/547.asp
Coal and Mineral Development in Alberta Year in Review
January 2014
Contents
Introduction3
Metallic and industrial minerals
3
2013 metallic and industrial mineral exploration
highlights4
2013 industrial mineral quarry activities
8
Coal9
2013 coal exploration highlights
9
2013 coal mine activities
11
In Situ Coal Gasification (ISCG)
14
CMD Updates
15
Activities15
Mineral Assessment Reports
15
Interactive maps
15
Legislation15
Alberta Energy Regulator
15
Coal Policy
16
New publications
16
Alberta Geological Survey
16
Land-use planning
16
Land-use Framework 16
Energy and Mines Ministers’ Conference
18
About Alberta’s regulatory system
19
ISBN 978-1-4601-1509-1 (Print)
ISBN 978-1-4601-1510-7 (Online)
CMD Year in Review-03(2013)
The information contained within this report has been collected
from publicly available government information, company
websites, press releases, and reports filed on Sedar (www.
sedar.com). All figures quoted are current as of the time of
publication. Please consult the company websites for specific
information regarding any projects outlined in this report. Any
other references are noted within the document. The authors
make no warranty of any kind with respect to the content and
accept no liability, either incidental, consequential, financial or
otherwise, arising from the use of this document.
Scan the QR code to go to the Alberta Energy
website, where you can download a pdf of the
2013 (and previous years') Year in Review.
Cover photo
Panoramic: Grande Cache coal mine, Grande Cache,
Alberta. Courtesy: T. Hauk
ISSN 2291-1545(Print)
ISSN 2291-1553 (Online)
“Coal and Mineral Development in Alberta Year in
Review” is published annually by Alberta Energy
2
Coal and Mineral Development in Alberta
The coal sector was very active in 2013, with
a number of sales of both operating mines and
exploration assets by long-term coal players to
new entrants to the Alberta coal market. This
is in addition to exploration started on new and
historical coal exploration targets. The main
interest, from a new development perspective,
is in the metallurgical coal potential. Exploration
targets were not the only news in the coal
sector: two potential new mines made significant
advancements towards starting in 2013.
Construction on one or both of the projects could
begin in 2014.
In conjunction with the rekindled interest in
Alberta’s coal, the province’s regional planning
through the Land-use Framework continued
with implementation of the Lower Athabasca
Regional Plan and development of the draft South
Saskatchewan Regional Plan.
Limited work was reported in the metallic and
industrial mineral sector; however, two advanced
projects reported work.
Metallic and Industrial
Minerals Permits
12,000
2013
Year in Review
8,000
6,000
4,000
2,000
0
1576 130 1305 60 1550 405 1121 43
2009
2010
2011
2012
986 12
2013
Figure 1. A bar graph with the total area of metallic and
industrial minerals permits and permit applications from 2009
through 2013 (the report period is October 1 through September
31). Numbers at the base of the bars indicate the number of
individual permits or applications.
Metallic and Industrial
Minerals Leases
094 Metallic and Industrial Minerals Lease
A94 Metallic and Industrial Minerals Lease Application
350
Metallic and industrial minerals
300
Area ('000 ha)
The total area covered by metallic and industrial
minerals permits decreased slightly from the
previous year, along with the total number of
permits (Figure 1). This is a continuation of a
downward trend in the total number of metallic and
industrial minerals permits over the past 5 years.
This, in part, is most likely the result of a reduction
of exploration activity by junior mining companies
that have been suffering the effects of low metal
prices and tight financial markets. The total number
of metallic and industrial minerals leases in Alberta
remained approximately the same in 2013 (Figure
2).
093 Metallic and Industrial Minerals Permit
A93 Metallic and Industrial Minerals Permit Application
10,000
Area ('000 ha)
Introduction
250
200
150
100
50
0
208 63
273 39
308 34
301 15
315
2
2009
2010
2011
2012
2013
Figure 2. A bar graph with the total area of metallic and industrial
minerals leases and lease applications from 2009 through 2013
(the report period is October 1 through September 31). Numbers
at the base of the bars indicate the number of individual leases or
applications.
3
As seen in the previous few years, the number of
metallic and industrial minerals licences continued
to rise in 2013, with a 50% increase from 2012
(Figure 3).
Assessment report filings in 2013 were
approximately $5 million, which are significantly
lower than the $15 million in 2012 (keeping in
mind 2012 saw a spike from the five-year average;
Figure 4). The assessment expenditures reported
have up to a two year lag from the work done
because assessment reports are required on a two
year cycle.
See Figure 6 for a map of tenure activity at the end
of 2013.
Metallic and Industrial
Minerals Licences
1,400
092 Metallic and Industrial Minerals Licence
1,200
DNI Metals Inc (www.dnimetals.com) announced
the analytical results from their 2012 drilling
program in January 2013; the drilling was on the
Buckton and Buckton South deposits on their SBH
property in northeast Alberta. In addition, a new
mineral resources estimate was released in August
2013 for the Buckton deposit. The estimate was for
a suite of metals, including nickel (Ni), cobalt (Co),
zinc (Zn), copper (Cu), uranium (U) [1], rare earth
elements (REE), and yttrium (Y).
Using the estimates provided in the mineral
resource assessment, DNI completed a Preliminary
Economic Assessment (PEA) for the Buckton
deposit. The PEA outlined a conceptual mine plan,
which featured significant potential for U and REE
production from the deposit, with achievable annual
productions of 450 tonnes of uranium yellowcake
and 5,500 tonnes of REE-oxides.
Iron
Ironstone Resources Ltd (www.
ironstoneresources.com) made significant progress
on its Clear Hills project, located approximately 80
kilometres northwest of Peace River in northwest
Alberta (Figure 5 and 6). The company’s focus has
shifted from exploration and deposit delineation
600
400
200
0
2009
2010
2011
2012
2013
Figure 3. A bar graph with the total number of active metallic and
industrial minerals licences from 2008 through 2012 (the report
period is October 1 through September 31).
Assessment Report Expenditures
18000
Accepted expenditures ($)
Area (ha)
Permits
16000
14000
400
300
10000
250
8000
200
6000
150
4000
0
450
350
12000
2000
500
Permits
Polymetallic Shale
800
Expenditures (x$1000)
Area (x1000 ha)
2013 metallic and industrial mineral exploration
highlights
Number
1,000
100
21
23
19
21
24
2009
2010
2011
2012
2013
50
0
Figure 4. A graph of mineral assessment report statistics for
2009 through 2013. The number of permits and area are those
reported in submitted reports. The accepted expenditures are
those accepted by Alberta Energy; the total amount claimed is
not reported, but is higher than the accepted expenditure value.
Accepted values for 2013 are preliminary because not all report
reviews were completed at the time of publication.
[1] In Canada, mining is usually governed by provincial regulations. Uranium production, however, is under federal
jurisdiction. Canada’s independent nuclear regulator, the Canadian Nuclear Safety Commission, regulates uranium
mines and mills and all subsequent stages of the nuclear-fuel cycle, such as refining, conversion and fuel fabrication, to
protect health, safety, security and the environment.
4
Coal and Mineral Development in Alberta
to metallurgical and process testing. From testing
during 2012-2013, Ironstone reported high
metallization of iron in reduction kilns, a reduction
in phosphorus levels, a decreased temperature
requirement for reduction, and vanadium
pentaoxide (V2O5) in the process tails.
How is steel produced?
There are two main ways that steel is
produced:
1) integrated smelting using a blast
furnace followed by a basic oxygen
furnace, and
2) the electric arc furnace.
The blast furnace method is the most
common, producing about 70% of the
world’s steel. Metallic iron is produced by
feeding iron ore, coke (from metallurgical
coal), and a flux (e.g. limestone) into the
furnace. This produces metallic iron, which
can be used to make steel.
The electric arc furnace uses primarily scrap
steel as the main feedstock. An electric arc
between two electrodes provides heat that
melts the scrap. Direct reduced iron (DRI)
can be used as an alternative feedstock for
this process.
Metallurgical coal from the Cardinal River
and Grande Cache mines in Alberta is
exported for use in blast furnaces.
The DRI briquettes that Ironstone
Resources intends to produce would be
used as a feedstock for electric arc furnaces.
Figure 5. A photograph of Ironstone Resources' bulk sample pit
at their Clear Hills property. The photo is courtesy of Ironstone
Resources Ltd.
Ironstone is planning more work over the next year
to advance their project toward commercialization.
A preliminary economic assessment is planned for
the first quarter of 2014, followed by a commercial
scale-up of their pilot project in quarter two. In
the fourth quarter of 2014, they are planning to
complete the process flow-sheet for the reduction
process. By the fourth quarter of 2015, Ironstone
anticipates completion of a demonstration pilot
plant and a pre-feasibility study on the project.
Whereas typical iron mines produce a 63% iron ore
as their final product, Ironstone is developing their
process to produce metallic iron briquettes, which
will be in the order of 90% iron. They are marketing
the briquettes as a substitute for scrap iron in
electric arc furnaces for steel production. Ironstone
is also developing a method to recover vanadium
as part of the process.
Ironstone’s Clear Hills project is an oolitic ironstone
deposit hosted in the Bad Heart formation. The
most recent resource figures are published in their
July 2012 NI 43-101 technical report. Ironstone
reports 652 Mt Indicated and Inferred resources
at 33% iron, and a 557 Mt Indicated resource at
0.20% V2O5.
Uranium
Declan Resources Inc (www.declanresources.
com) announced, in October 2013, that they have
reached an option agreement with 877384 Alberta
Ltd for the Firebag River Uranium property. The
agreement includes a $3 million work commitment
by Declan. The property is located 30 km southwest
of the Athabasca Basin. Limited exploration on the
property was completed by E&B Explorations Ltd in
1977.
For additional information regarding metallic and
industrial permits and properties that did not report
active exploration in 2013, go to Alberta Energy’s
online interactive map: www.energy.alberta.ca/
OurBusiness/1072.asp.
Other commodities
Alberta remains prospective for various other
metallic and industrial minerals, despite no
continued on page 8
2013
Year in Review
5
Metallic &
Industrial Minerals
Agreement Activity
WOOD BUFFALO
Permit
Lease
Permit Application
Indian Reserve
Métis Settlement
National Park
Municipality
2
Hydrography
Primary Highway
1 Ironstone Resources
2 DNI Metals
Fort McMurray
1
63
2
5
Grande
Prairie
Cold Lake
28
ELK ISLAND
16
EDMONTON
16
Lloydminster
JASPER
Red Deer
2
BANFF
CALGARY
SOURCE INFORMATION:
Mineral Agreements: Alberta Energy
Indian Reserves: Natural Resources Canada
Base Map Data Provided by Spatial Data Warehouse Ltd.
DISCLAIMER:
This product or the data represented within may not be revised,
copied, distributed, republished, uploaded, posted, or transmitted
in any way without prior consent of Alberta Energy, the Government
of Alberta. The information as depicted is subject to change; therefore
the Government of Alberta assumes no responsibility for discrepancies
at time of use.
Published Date: December 2013
Author: Resource Mapping & Analysis (JS)
1
0
50
100
2
Medicine
Hat
Lethbridge
3
Kilometres
Transverse Mercator Projection (10TM)
North American Datum 1983 (NAD83)
WATERTON
LAKES
www.energy.alb erta.ca
G:\Custom\2 013\P ro jects\CMD\CMD_A nnualRepo rt_ Dec20 13\Metallic_ Activity
Figure 6. A map of Alberta showing metallic and industrial mineral tenure activity as of December, 2013. An interactive, real-time
version of this map is available at www.energy.alberta.ca/OurBusiness/1072.asp
6
Coal and Mineral Development in Alberta
12,000
$700
350
$600
300
10,000
$500
8,000
$400
6,000
$300
4,000
$200
2,000
$100
0
2009
2010
2011
2012
2013
Production (x1000 tonnes)
Production
Royalty
Royalty paid (x$1000)
Production (x1000 tonnes)
14,000
Salt Production
250
$125
$75
150
$50
100
$25
50
0
$150
$100
200
$0
Figure 7. The total quarriable mineral production and royalty
collected for the last five years, including 2013. The report period
is from October 1 to September 31.
Production
Royalty
2009
2010
2011
2012
2013
$0
Figure 8. The total salt production and royalty collected for the last
five years, including 2013 The report period is from October 1 to
September 31.
Industrial Mineral Quarries
Mine/Quarry
Commodity
Location
Operator
Calling Lake*
Salt
North of Athabasca
Calcium Inc.
Clearwater
Limestone
Rocky Mountain House
Burnco Rock Products Ltd.
Cougar Ridge
Limestone
Rocky Mountain House
Prairie Creek Quarries Ltd.
Exshaw
Limestone
Exshaw
Lafarge Canada Ltd.
Fish Creek
Limestone
Nordegg
Graymont Western Canada Inc.
Fort Hills
Limestone
North of Fort McMurray
Hammerstone Corporation
Fort McMurray West
Limestone
Fort McMurray
Suncor Energy Inc.
Gap
Limestone
Exshaw
Graymont Western Canada Inc.
McLeod
Limestone
Cadomin
Lehigh Hanson Materials Ltd.
Mitsue*
Salt
Slave Lake
Tiger Calcium Services Inc.
Muskeg
Limestone
North of Ft McMurray
Hammerstone Corporation
Peace River Silica
Silica Sand
Peace River
Contractors Leasing Corp.
Riverview*
Salt
Riverview
The Canadian Salt Company Ltd.
Rundle Stone
Dolomitic Siltstone
Canmore
Kamenka Quarries Ltd.
Seebe
Shale
Kananaskis
Lafarge Canada Ltd.
Sprayfalls
Sandstone
Exshaw
Thunderstone Quarries Ltd.
Steepbank
Limestone
North of Fort McMurray
Hammerstone Corporation
Summit Lake
Limestone
Coleman
Graymont Western Canada Inc.
Sunnynook*
Salt
Drumheller
Jarodon Resources Ltd.
Vicory
Sandstone
Coleman
Pat Dwyer Construction Inc.
Yamnuska
Sandstone
Kananaskis
Lafarge Canada Ltd.
Table 1. A table of the active industrial mineral quarries in Alberta; there are no metallic mines. *Salt is produced through in
situ leaching from the Elk Point group.
2013
Year in Review
Royalty paid (x$1000)
Quarriable Mineral Production
7
publicly reported exploration over the past year.
This includes base metals in northwest Alberta,
diamonds in the Buffalo Head Hills area, lithium in
groundwater near Fox Creek and Valleyview, and
potash along the southern portion of the AlbertaSaskatchewan border.
Titanium Corporation (www.titaniumcorporation.
com) continued with their process development for
extracting heavy minerals and residual bitumen
from oil sands tailings. Titanium’s plan is to
integrate their technology into the current oil sands
processing circuits and process the tailings before
they are sent to settling ponds. The company
suggests that the oil sands contain almost 1%
heavy minerals, which are concentrated to 25%
in the sand fraction during the primary bitumen
recovery process [2].
January 16, 2013. A pre-hearing meeting was
held in Fort McMurray in August 2013 to discuss
potential issues that may arise during a public
hearing of the project. A report from that meeting
was released by the NRCB on September 6, 2013.
At the time of publication a hearing date was not
set.
The Parsons Creek Aggregate project is located
between highway 63 and the Athabasca River,
immediately north of Fort McMurray. The company
plans to quarry 58 Mt of limestone over a 40 year
mine life.
2013 industrial mineral quarry activities
Production and royalty. The royalty rates for
quarriable minerals, salt and placer gold are all
production-based. The metallic mineral royalty is
revenue-based but there is currently no production
of metallic minerals.
The production of both quarriable minerals
(including limestone, dolomitic siltstone, sandstone,
and silica sand) and salt are slightly down from
2012 (Figure 7 and 8). It is, however, within the
relatively flat five-year trend. The most significant
quarriable mineral production each year is
limestone. Salt production is completely from in
situ leach operations that remove salt from the
Devonian Elk Point group.
Table 1 lists all operating industrial mineral quarries
in Alberta.
Limestone
Parsons Creek Aggregates (www.
parsonscreekresources.com) continued through
the review process for their limestone quarry
project (Figure 6). In January 2013 they submitted
a Supplementary Request Responses #4
document to the Natural Resources Conservation
Board (NRCB; www.nrcb.ca) and held an open
house in Fort McMurray. The NRCB considered
the Parsons Creek application complete,
and Alberta Environment and Sustainable
Resource Development (ESRD) considered their
Environmental Impact Assessment complete, on
What is limestone used for in
Alberta?
Limestone is made of the mineral calcite,
which is calcium carbonate (CaCO3). It is
an important industrial mineral commodity
throughout the world. Because limestone is
inexpensive and heavy, it is not economic to
transport it over distance; it is important that
there is a local supply.
Without any processing, limestone is used
as a building stone, for landscaping, or it is
crushed for use as an aggregate for road
construction. Limestone from the Muskeg
Quarry is used for building mine haul roads
and well pads in the oil sands area. The
Parson’s Creek Aggregate project also
proposes to produce limestone for use as
a reagent to remove sulphur in bitumen
upgrader operations, or for water purification
at in situ oil sands projects.
Graymont and Lafarge plants near Exshaw
produce refined products, such as quick
lime (calcium oxide; CaO) which is a key
ingredient in the production of cement.
[2] Zircon from a unique source. Mineral Sands Report, issue 197, March 2012, pages 11-15.
8
Coal and Mineral Development in Alberta
Coal
See Figure 11 for a map of Alberta’s coal fields,
coal ranks, mines, and projects.
2013 coal exploration highlights
In Fall 2013, Altitude Resources Ltd (www.
altituderesources.ca) signed an exploration and
option agreement with Elan Coal Ltd (www.
elancoal.com) that can earn Altitude up to a 51%
interest on 22,000 hectares of coal rights that
Elan holds in coal lease applications. The lease
applications are located in the Eastern Slopes north
of the Crowsnest Pass area in southwest Alberta;
they extend for approximately 55 kilometres along
strike of the Kootenay group.
Coal Leases
800
700
013 Coal Lease
A13 Coal Lease Application
600
Area ('000 ha)
The total area and number of coal leases and
coal lease applications in the province remained
constant from 2012 to 2013 (Figure 9). Whereas
interest in 2012 was focused on acquiring new
coal rights, 2013 saw companies focused more on
commencing exploration programs and doing other
work on their properties.
500
400
300
200
100
0
1143 284 1167 294 1231 332 1205 554 1216 561
2009
2010
2011
2012
2013
Figure 9. A bar graph with the total area of coal leases and
lease applications from 2009 through 2013 (The report period is
October 1 through September 31). Numbers at the base of the
bars indicate the number of individual leases or applications.
The Elan property includes five different areas with
historical work, dating back to the 1940s, by various
companies, including Consol Energy, Devon
Canada, Granby Mining, CanPac Minerals, and
Canadian Hunter. Current exploration is targeting
multiple coal seams of low-mid volatile bituminous
coal. Altitude is planning to complete an NI 43-101
compliant resource calculation in 2014.
From August to September 2013, Altitude drilled 30
holes on their Palisades property, which is located
north of Highway 16 near Hinton. The 4,583 metres
of drilling included 27 rotary and 3 core holes. Coal
analysis on the collected samples was underway at
the time of publication. A 2011 NI 43-101 technical
report on the property identified a 140 million tonne
exploration target. Coal quality is low to medium
volatile with variable but generally moderate ash
content, with good washability and coking coal
properties. Historical work was completed as the
Hoff property by Rio Tinto, in 1969, and Denison
Mines during 1982-83.
Black Eagle Mining Corporation (www.
blackeaglemining.com) completed the drilling of 48
exploration drill holes in 2012, on its Blackstone
metallurgical coal project (Figure 11). NI 43-101
Measured and Indicated Resources of 176 Mt of
2013
Year in Review
Figure 10 . Coal core from Riversdale Resources' Grassy
Mountain project. The photo is courtesy of Riversdale
Resources.
9
Figure 1: Export
Bituminous
Alberta
coal mines
& Domestic
and
projects
Subbituminous Coals
WOOD BUFFALO
Coal Mine
S
Ç
Ç
«
Advanced Coal Project
A
Export/Domestic Boundary
S
Land Use Framework
Boundaries
K
Coal Leases/Applications
Coal Fields & Deposits
A
LOWER PEACE
Bituminous Coals
T
Subbituminous Coals
C
Fort McMurray
Lignites
Indian Reserve
H
Métis Settlement
³
²
63
UPPER PEACE
2
A
Primary Highway
³
²
Hydrography
N
Grande
Prairie
UPPER
ATHABASCA
Cold Lake
³
²
28
Grande Cache
Obed
R
I
Ç
JASPER
EDMONTON
16
Vista
Ç
Highvale
Ç
ÇÇ
Coal Valley Burtonsville
Island
Cheviot
Genesee
T
Red Deer
I
Ç
«
Blackstone
³
²
S
2
H
Paintearth/Vesta
Sheerness
CALGARY
L
Kilometres
ÇÇ
Ç
Ç«
«
Ç «
Ç
Ç
SOUTH
SASKATCHEWAN
Elan
B
Transverse Mercator Projection (10TM)
North American Datum 1983 (NAD83)
³
²
2
U
100
M
I
A
Published Date: December 17, 2013
Author: Resource Mapping & Analysis <st>
Ç
O
´
50
Ç
Lloydminster
NORTH
SASKATCHEWAN
Ç
C
0
16
Dodds
RED DEER
BANFF
SOURCE INFORMATION:
Alberta Coal Data: Alberta Energy Regulator
British Columbia Coal Data: BC Ministry of Energy & Mines
Indian Reserves: Natural Resources Canada
Base Map Data Provided by Spatial Data Warehouse Ltd.
ELK ISLAND
Grassy
Mountain
1
Medicine
Hat
³
²
B
Ç ÇÇ
«
«
³
²
Palisades
³
²
Summit Coal
³
²
ÇÇ
«
DISCLAIMER:
This product or the data represented within may not be
revised, copied, distributed, republished, uploaded, posted,
or transmitted in any way without prior consent of Alberta
Energy, the Government of Alberta. The information as
depicted is subject to change; therefore the Government
of Alberta assumes no responsibility for discrepancies
at time of use.
W
LOWER
ATHABASCA
Municipality
E
National Park
3
Lethbridge
WATERTON
LAKES
Figure 11. A map of Alberta showing coal tenure activity (dark brown), and coal mines and projects, as of December, 2013. Coal
fields (light brown) and approximate coal rank distribution (coloured bands) are also shown. An interactive, real-time version of the
coal tenure on this map is available at www.energy.alberta.ca/OurBusiness/1072.asp.
10
Coal and Mineral Development in Alberta
high quality mid-volatile metallurgical coal were
reported from this drilling with a total Resource
of 275 Mt. A preliminary economic assessment is
currently underway and further exploration and
feasibility study is planned for mid-2014.
Riversdale Resources entered the Alberta coal
market in 2013 with the purchase of coal assets
in the Crowsnest Pass from Consol Energy and
Devon Canada. The sale was for Crown leases
and freehold rights for coal, for $24 million and $23
million respectively. The main asset of the sale is
the Grassy Mountain property from Consol, which
is located immediately north of Blairmore (Figure
11), and also includes three additional exploration
projects: Bellvue, Adanac, and Lynx.
The Grassy Mountain property is a historic
metallurgical bituminous coal project. There are
existing mine workings from the production of 3.5
million tonnes of coal between 1947 and 1960.
Consol Energy drilled 391 exploration holes on the
property between 1973 and 1975, and collected
a 54,000 tonne bulk sample. The last historical
work was a feasibility study in 1982 that suggested
annual production of 2 million tonnes over a 28
year mine life.
Riversdale completed a pre-feasibility study and
environmental audit in 2013, and have begun the
initial steps to commence an environmental impact
assessment. They have engaged a consultant
to begin work on a feasibility study, and have
commenced drilling on the property (Figure 10).
Riversdale reports both resources and reserves for
the property:
Resources
Measured
Indicated
Inferred
Reserves
Proven
Probable
38.5 million tonnes
101.8 million tonnes
51.7 million tonnes
19.8 million tonnes
72.2 million tonnes
Other Alberta assets sold by Consol Energy were
purchased by Ram Coal (www.ramcoal.com). The
$55 million sale was for coal lease applications in
the Rocky Mountain Foothills. The Ram and Scurry
Ram properties are located south of Nordegg.
Ram Coal reports a NI 43-101 compliant Measured
and Inferred resource of 359.0 Mt, and Inferred
resource of 84.8 Mt of medium- to high-volatile
metallurgical bituminous coal.
2013
Year in Review
There are 501 historical drill holes on the properties
since 1970. Ram Coal has planned 66 new holes
in 2013 and 2014, using rotary and core drills. They
planned environmental and engineering work for
the end of the third quarter of 2013, and a feasibility
study in 2014.
2013 coal mine activities
On December 24, 2013 Sherritt International
Corporation (www.sherritt.com) announced the
sale of coal assets for $946 million. Coloradobased Westmoreland Coal Company (www.
westmoreland.com) will buy Sherritt’s Prairie and
Mountain operations in Western Canada for $465
million and Altius Minerals (www.altiusmineral.
com) of St. John’s, NL, will buy Sherritt’s entire coal
and potash royalty portfolio and coal developments
for $481 million.
Sherritt’s mountain operations in Alberta include the
active Coal Valley mine and the suspended Obed
Mountain mine. Production from Sherritt’s mountain
operations in 2012 totalled approximately 3.5 Mt.
Sherritt’s Prairie Operations in Alberta include four
subbituminous (mine-mouth) coal mines: Highvale,
Paintearth, Sheerness, and Genesee. These
mining operations supply electricity generators with
coal under secure long-term contracts. Production
in 2012 from Sherritt’s mine-mouth operations was
approximately 21.6 Mt.
Production and Royalty. Bituminous coal
production has remained constant over the last
three years. Because of lower net revenues
reported by producers, royalty payable has
decreased over the same period (Figure 12). The
total subbituminous coal production has remained
about the same in 2013 as the previous four years
(Figure 13). The proportion of production from
Crown-owned coal is higher over the last three
years, which has resulted in an elevated amount of
royalty collected relative to 2009 and 2010.
Table 2 lists all operating coal mines in Alberta.
Summit Coal
In August 2013, Maxim Power Corp (www.
maximpowercorp.com) received final approvals
from the Alberta Energy Regulator (AER) to begin
construction on their Summit Coal Mine project
(Summit Coal) at Grande Cache (Figure 11). The
11
8,000
7,000
30,000
$25,000
25,000
$20,000
6,000
5,000
$15,000
4,000
$10,000
3,000
2,000
$5,000
1,000
0
$30,000
2009
2010
2011
2012
2013
Production (x1000 tonnes)
Production
Royalty
9,000
Royalty paid (x$1000)
Production (x1000 tonnes)
10,000
Subbituminous Coal Production
Production
Royalty
$7,000
$6,000
15,000
$5,000
$4,000
10,000
$3,000
$2,000
5,000
0
Figure 12 . The total bituminous coal production and royalty
collected for the last five years, including 2013. The report period is
from October 1 to September 31.
$9,000
$8,000
20,000
$0
$10,000
40%
43%
59%
60%
59%
2009
2010
2011
2012
2013
Royalty paid (x$1000)
Bituminous Coal Production
$1,000
$0
Figure 13. The total subbituminous coal production and royalty
collected for the last five years, including. The percentages are the
portion of the production from Crown coal rights. Alberta Energy
does not collect royalty is on freehold coal production. The report
period is from October 1 to September 31.
Coal Mines
Mine
Coal rank
Location
Owner/Operator
Main use
Burtonsville
Subbituminous
Burtonsville
Keephills Aggregate Company
Inc.
Small-scale sales
Cheviot
Bituminous
(Cardinal River)
Hinton
Teck Coal Ltd.
Export: metallurgical
Coal Valley
Bituminous
Hinton
Coal Valley Resources Ltd.
Export: thermal
Dodds
Subbituminous
Ryley
Dodd’s Coal Mining
Company Ltd.
Small-scale sales
Genesee
Subbituminous
Warburg
Capital Power LP /
Prairie Mines and Royalty Ltd.
Electricity: Genesee generating
stations
Grande Cache
Bituminous
Grande
Cache
Grand Cache Coal Corp.
Export: metallurgical
Highvale
Subbituminous
Wabamun
Transalta Corp. /
SunHills Mining LP
Electricity: Keephills and
Sundance generating stations
Paintearth/
Vesta
Subbituminous
Forestburg
Prarie Mines and Royalty Ltd.
Electricity: Battle River
generating stations
Sheerness
Subbituminous
Hanna
Prairie Mines and Royalty Ltd.
Electricity: Sheerness generating
stations
Table 2. A table of the active coal mines in Alberta.
12
Coal and Mineral Development in Alberta
How do I get application
information from the AER?
All applications and supporting information
are required to be put on the public record.
To view an application, contact
AER Information Product Services
Suite 1000, 250-5 St SW
Calgary, AB T2P 0R4
phone. 1-855-297-8311
e-mail. [email protected]
Alberta Government Library
Great West Life Building
6th Floor, 9920-108 St NW
Edmonton, AB T5K 2M4
phone. 780-427-5828
approvals include a new licence for a beneficiation
plant and an amendment to their existing Mine 14
mine licence that increases the maximum annual
production from 0.48 Mt to 1.3 Mt. Summit Coal is
being developed through the Summit Coal Limited
Partnership.
The beneficiation plant will be located on Milner
Power’s existing industrial complex, and, each
year, will produce 950,000 tonnes of low- to midvolatile bituminous metallurgical coal for export.
The 350,000 tonnes of waste coal will be used as
a mine mouth feedstock to the HR Milner power
station on the complex.
Maxim issued an updated NI 43-101 technical
report in May 2013, which reported a 119.3 Mt
Measured and Indicated Resource, a 154.0 Mt
Inferred Resource, and a 18.7 million tonne Proven
and Probable Reserve. Current reserves and
proposed annual production give a 15 year mine life
for the project.
The latest timelines from Maxim have mine
equipment being delivered in 2014 and coal
production beginning at the start of 2015. They
have secured port space at Ridley Terminals in
Prince Rupert. In August 2013, Maxim announced
the sale of US assets, in order to help finance
construction of the Summit coal mine.
2013
Year in Review
Vista
Coalspur Mines Limited (www.coalspur.com) is in
the final stages of the Alberta Energy Regulator’s
(AER) regulatory review of their Vista coal mine
project.
Public hearings were scheduled to hear opposition
to the project from four interveners. In December
2013, Coalspur announced that it came to an
agreement with the Ermineskin Cree Nation and the
Whitefish Lake First Nation, which were registered
as interveners in the review. They subsequently
announced an agreement with the third intervener,
Tourmaline Oil Corp. At the time of publication there
was one remaining intervener for a January 2014
hearing in Hinton. The AER is required to deliver
decisions no later than 90 days after each hearing,
therefore as of the publication date a final decision
had not been delivered.
In March 2013, Coalspur announced that they
have signed a final agreement with CN to transport
coal to tidewater at the Ridley Terminals in Prince
Rupert, BC. It is a seven year contract, from
January 1, 2013 to December 31, 2019, for up to
12 million tonnes per year. The agreement also
includes the construction of 6.5 km of rail to tie CN’s
rail line into Vista’s proposed loading facilities. With
the transportation agreement signed, Vista released
an estimated total FOB operating cost of $59.55 per
tonne over the first ten years of the mine.
13
The Vista project is a proposed bituminous coal
mine that would supply thermal coal to Asian
markets. Coalspur reports a 1.7 billion tonne
Measured and Indicated coal resource that will be
mined over a 30 year mine life.
Obed Mountain
On October 31, 2013, the Obed Mountain mine
reported a breach in a containment pond that
released approximately 670,000 cubic metres
of process water into the nearby Apetowun and
Plante creeks. While there was an increase of
contaminants in the water reported by Alberta
Environment and Sustainable Resources
Development (ESRD), Alberta Health, on
November 17, 2013 said tests indicated there was
no immediate risk to human health. A notification
was also issued to towns downstream to avoid
drawing water while the plume was passing.
ESRD issued an Environmental Protection Order
on November 19, 2013 to the mine operator, Coal
Valley Resources Inc, and the parent company,
Sherritt International Corporation. The order
requires the company to file several plans with
ESRD:
•
Solids recovery plan
•
Short- and long-term impact assessment
plan
•
Wildlife mitigation plan
•
Waste management plan
•
Mine wastewater management plan
•
Detailed and comprehensive remediation
plans
Sheerness
Prairie Mines and Royalty (www.sherritt.com)
filed an application with the Alberta Energy
Regulator (AER), and Environment and Sustainable
Resource Development in October 2013 to expand
the Sheerness mine. Their plan is to expand
the current mine permit area so production can
be moved into coal reserves adjacent to current
production.
The Sheerness mine is located approximately 200
km northeast of Calgary, near the town of Hanna.
It produces subbituminous coal, which is used as a
feedstock for the Sheerness generating station. The
Sheerness station is co-owned by TransAlta and
ATCO Power; ATCO Power operates the units.
In Situ Coal Gasification (ISCG)
There was no significant work done in 2013 with
respect to developing in situ coal gasification. The
most advanced project in the province, Swan Hills
Synfuels’ pilot project, has been on hold since late
in 2011.
The Obed Mountain mine, located approximately
30 kilometres northeast of Hinton, is currently
inactive. The last continuous production was in
November 2012; a small amount of stockpiled coal
was processed in August 2013. The mine produced
bituminous coal that was exported overseas as high
quality thermal coal.
Sherritt has stated that they will remain involved in
the clean-up process throughout and after the sale
of their coal assets.
Figure 14 . New exposure of folded coal seams at the Grande
Cache coal mine. The photo is courtesy of T. Hauk.
14
Coal and Mineral Development in Alberta
CMD Updates
Activities
Roundup and PDAC. Representatives from the
Coal and Mineral Development (CMD) branch
of Alberta Energy hosted booths at the Mineral
Exploration Roundup in Vancouver and the
Prospectors and Developers’ Association of
Canada convention in Toronto, in 2013. These
conferences provide Alberta Energy an opportunity
to disseminate information about Alberta, our
resources, mineral rights, and other related
topics. They also provide an opportunity for those
interested in Alberta to make a direct connection.
Staff will be attending both conferences again in
2014.
China Mining Conference and Investment
Forums. Alberta Energy engaged for the first time
as a full participant with a Canadian delegation to
the annual China Mining Conference and Exhibition
(www.china-mining.org/en/index.aspx) in Tianjin,
China, and Canada Mineral Investment forums in
Beijing and Shanghai, China, and Tokyo, Japan.
The trip was successful solidifying new connections
and building relationships in Asia. Alberta also
helped arrange mineral investment forums where
companies working in Alberta met investors based
in China and Japan. Support for the trip was
provided by the Alberta offices in Beijing and Tokyo.
Other jurisdictions that were part of the Canadian
delegation were British Columbia, Yukon,
Saskatchewan, Quebec, Newfoundland and
Labrador, and the federal government.
Interactive maps
There are online interactive maps available on the
Alberta Energy website to show up-to-date tenure
information for ammonite shell, coal, and metallic
and industrial minerals. The data is updated nightly.
The maps are a very important tool for those
interested in applying for mineral rights.
New for 2013, the interactive maps were upgraded
to the Geoview platform. This has improved their
functionality and performance and includes several
new features:
•
Enhanced search and navigation functions
•
New annotation tool
•
Integration with Google maps
•
New feature identification tools
Data from the ammonite shell, coal, and metallic
and industrial minerals maps are still available
for download, as they were before. The maps are
located in the same place on the Alberta Energy
website as the old versions (www.energy.alberta.
ca/OurBusiness/1072.asp). There is an easy to use
tutorial available, accessed by selecting the help
button when in the map.
Legislation
Mineral Assessment Reports
All assessment reports submitted to the department
are subject to a confidentiality period of one year.
The most recent reports will not be available on the
website until after this period.
New this year, non-confidential mineral assessment
reports housed by Alberta Energy are available on
the Alberta Energy website: www.energy.alberta.
ca/minerals/3441.asp. Reports dating back to
1949 have been scanned and are available in PDF
format.
Mineral assessment reports are required by Alberta
Energy for a permittee to maintain a Metallic and
Industrial Minerals Permit. Every two years, a
2013
permittee must supply a report that documents the
exploration work they did during the previous twoyear period and that they expended the required
amount of money doing so. Assessment reports are
the record of the exploration work that is done by
permit holders.
Year in Review
Alberta Energy Regulator
On December 10, 2012, the government passed
the Responsible Energy Development Act; it came
into force on June 17, 2013. The act established
the Alberta Energy Regulator (AER), which is
provided the mandate to regulate all aspects of oil,
gas, and coal development in Alberta. It replaces
the Energy and Resources Conservation Board,
which no longer exists, as well as taking on the
energy specific regulatory responsibilities from
Alberta Environment and Sustainable Resource
Development (ESRD), including the Public
Lands Act, the Environmental Protection and
15
Enhancement Act, and the Water Act. The AER is
100% funded by industry and is an arms-length
agency that reports to the Minister of Energy.
Coal Policy
The current Coal Development Policy for Alberta
was published in 1976. Alberta Energy is currently
evaluating what opportunities may exist to update
the 1976 Coal Policy so that, going forward, policy
for coal in Alberta takes into account current and
anticipated coal sector dynamics.
New publications
Alberta Geological Survey
The Alberta Geological Survey (AGS) released new
bedrock geology maps for Alberta and the Alberta
Rocky Mountains. Maps and all other publications
are available for free from their website: www.ags.
gov.ab.ca.
Geology of the Alberta Rocky Mountains and
Foothills. Pana, D.I. and Elgr, R., AER/AGS MAP
563, 2013.
Bedrock Geology of Alberta. Prior, G.J.,
Hathaway, B., Glombick, P.M., Pana, D.I., Banks,
C.J., Hay, D.C., Schneider, C.L., Grobe, M., Elgr,
R., and Weiss, J.A., AER/AGS MAP 600, 2013.
Notes to Accompany MAP 600. Prior, G.J., AER/
AGS Open File Report 2013-02, 2013.
Land-use planning
The Alberta Land Stewardship Act (ALSA)
was passed June 4, 2009 and is the legislative
mechanism to implement and support the
development of regional plans under the Landuse Framework (LUF). To clarify the intent of
the legislation and reinforce the Government of
Alberta’s commitment to respecting the property
rights of Albertans, a number of amendments were
introduced in the ALSA on May 10, 2011.
Land-use Framework
A key strategy of the Land-use Framework (LUF)
is the development of seven regional land use
plans (see Figure 15). Along with environmental
monitoring and regulatory enhancement, regional
planning is a cornerstone of the resource system
that the Government of Alberta is building. This
more integrated and coordinated resource system
will deliver the best economic, environmental and
social benefits for Albertans today, and improve
competitiveness and certainty for industry for years
to come.
Lower Athabasca Regional Plan
The Lower Athabasca Regional Plan (LARP),
the first regional plan developed under the LUF,
was publicly released in August 22, 2012 and
the regulatory components of the plan took effect
on September 1, 2012. The LARP is a forwardlooking, 50-year blueprint that provides the strategic
direction needed to enhance environmental
management in the Lower Athabasca Region
which hosts the Athabasca Oil Sands Area, a major
economic driver for the region and the province.
The LARP ensures future opportunities for oil
sands, petroleum and natural gas, metallic and
industrial mineral, and electricity development.
The establishment of six new conservation areas
by the LARP brings the total conserved area to
two million hectares (22% of the region). The plan
also requires the development of biodiversity,
groundwater and surface water quality frameworks.
Nine new recreation areas established by LARP
help address social needs, giving Albertans access
to various recreational sites to enjoy year round.
Implementation of LARP is underway, and
comprises a number of key elements. These
include the establishment of the Urban
Development Service Region around Fort
McMurray to enhance the City of Fort McMurray’s
ability to respond to the population growth impacts
of development, the cancellation of Oil Sands
and Metallic and Industrial Mineral agreements in
conservation areas, and the development of air,
Land-use planning questions?
For more information regarding the LARP,
SSRP, or other land-use plans, contact:
Land-use Framework Regional Planning
780-427-7707
16
Coal and Mineral Development in Alberta
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Published Date: October 2012
Author: Integrated Resources & Environmental Policy (eu)
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DISCLAIMER:
This product or the data represented within may not be revised,
copied, distributed, republished, uploaded, posted, or transmitted
in any way without prior consent of the Alberta Energy, Government
of Alberta. The information as depicted is subject to change; therefore
the Government of Alberta assumes no responsibility for discrepancies
at time of use.
18
C.F.B.
18
SOURCE INFORMATION:
Land-use Framework: Government of Alberta
Parks & Protected Areas: Alberta Tourism, Parks & Recreation
Indian Reserves: Natural Resources Canada
Base Map Data Provided by Spatial Data Warehouse Ltd.
28
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G:\access\basemaps\LUF\LUF
Figure 15. A map of Alberta, showing the boundaries of the regional planning areas associated with Alberta's
Land-use Framework.
2013
Year in Review
17
water and biodiversity management frameworks for
the region.
Energy and Mines Ministers’
Conference
South Saskatchewan Regional Plan
The 2013 Energy and Mines Ministers’ Conference
(EMMC) was held August 25 – 27, 2013 in
Yellowknife, NT. The meeting was co-hosted by
the Canadian Minister of Natural Resources, Joe
Oliver, and the Northwest Territories Minister of
Industry, Tourism, Investment, and Transportation,
David Ramsay.
The draft South Saskatchewan Regional Plan
(SSRP) was released October 10, 2013. Direction
in the draft SSRP supports Alberta’s Integrated
Resource Management System (IRMS) by
establishing clear regional outcomes, providing
clear direction to land use decision-makers, and
the use of monitoring to support achievement of the
outcomes.
The draft SSRP seeks to provide certainty for
industry by ensuring that well-defined rules for
access to, and responsible development of, natural
resources are in place. The draft SSRP proposes
setting aside 125,000 hectares in ten new or
expanded Conservation Areas to help sustain
biodiversity and maintain healthy ecosystems.
To help meet growing demand for recreational
opportunities, 21 new or expanded parks or
recreation areas are also proposed in the draft
SSRP.
Formal public consultation sessions on the draft
SSRP were held between November 5 and
November 28, 2013. The input received from
these consultations and online workbooks will
be considered in the final drafting of the SSRP. It
is currently anticipated that the final plan will be
released on or around April 1, 2014.
Other regional plans
Pre-planning work for the remaining 5 plans is
underway. A Regional Advisory Council is expected
to be struck for the North Saskatchewan Regional
Plan in Spring 2014.
Alberta Energy staff are actively involved in several
EMMC sub-committees, including the Green Mining
Initiative, and the Mining Sector Performance
Report, as part of the Mines Intergovernmental
Working Group.
Green Mining Initiative [3] – Ministers endorsed
and approved the Green Mining Initiative (GMI)
Progress Report: Addressing Regulatory Barriers
to the Adoption of Green Mining Technologies in
Canada. The GMI has three major tasks:
•
Enhance engagement and communications
with industry and regulators
•
Assess the feasibility of an environmental
technology verification program
•
Assess the use of outcome-based
regulations as a means to foster mining
innovation
Mining Sector Performance Report [4] – Ministers
released the 2013 edition of the Mining Sector
Performance Report (MSPR). The MSPR provides
an analysis of economic, environmental, and social
performance of Canada’s mining sector, from 1998
to 2012. Development of the report is directed by
an EMMC sub-committee with representatives
from nine provinces and territories, and an external
advisory committee with representation from
industry, NGOs, academia, and Aboriginal groups.
The first edition of the MSPR was released at
EMMC in 2010 (for the period 1998-2008). The
working group is tasked by ministers to provide an
updated version every three years.
[3] The Natural Resources Canada website has more information on the GMI:
www.nrcan.gc.ca/minerals-metals/technology/4473
[4] www.nrcan.gc.ca/minerals-metals/sites/www.nrcan.gc.ca.minerals-metals/files/files/pdf/MSP-report-eng.pdf.
18
Coal and Mineral Development in Alberta
About Alberta’s regulatory system
The Crown owns 81% of the mineral rights in Alberta. The other 19% are Freehold mineral rights and
are owned by individuals, companies or the federal government on behalf of First Nations. The Coal and
Mineral Development Branch is responsible for the administration of the Crown’s mineral rights for metallic
and industrial minerals and coal.
The mineral rights for coal, and metallic and industrial minerals are managed using a variety of agreements,
depending on the specific substance and/or activity a client wishes to pursue (see Table 3). Each agreement
type is defined and governed through the Alberta’s Mines and Minerals Act, the Metallic and Industrial
Minerals Tenure Regulation, and the Ammonite Shell Regulation. Fees and rentals are set out in the Mines
and Minerals Administration Regulation
Annual
rental
Work requirements
$625
N/A
Term 1
$5/ha
Term 2-3 $10/ha
Term 4-7 $15/ha
15 years;
renewable
$625
$3.50/ha
N/A
The exclusive right to
win, work, and recover
metallic and industrial
minerals.
15 years;
renewable
$625
$3.50/ha
N/A
Metallic and
Industrial
Minerals
Licence
The non-exlusive right to
win, work, and recover
metallic and industrial
minerals through placer
mining (i.e. a sluice
box).
5 year; notrenewable
$50
N/A
N/A
Secondary
Mineral Lease
The right to win, work,
and recover metallic
and industrial minerals
through a secondary
recovery operation.
5 years;
renewable
$625
$3.50/ha
N/A
Special Mineral
Lease*
The exclusive right to
create caverns and store
material in underground
salt formations.
15 years;
renewable
$625
$12.50/
ha
N/A
Ammonite Shell
Agreement
The exclusive right
to recover ammonite
shell. Must be held in
conjunction with an
exemption from the
Historical Resources
Act.
15 year,
5 year
renewal
$625
$3.50/ha
N/A
Agreement
Rights granted
Term
Metallic and
Industrial
Minerals Permit
The exclusive right to
explore for MIM in the
subsurface and remove
samples for exploration
purposes.
14 years,
divided
into 7
2-year work
terms; notrenewable
Coal Lease
The exclusive right to
win, work, and recover
coal.
Metallic and
Industrial
Minerals Lease
Application fee
Table 3. A table outlining the various coal, and metallic and industrial minerals agreements, along with the detail of each type of
agreement. *Special Mineral Leases are one-off agreements between a lessee and the Crown; the details listed in this table are not
exclusive, they are the most common.
2013
Year in Review
19
www.energy.alberta.ca