Lone Pine Resources Files Outrageous NAFTA Lawsuit Against Fracking Ban

Media Release
October 3, 2013

Lone PineCanada, Quebec and U.S. Environmental Groups Denounce the anti-environmental case

WASHINGTON, D.C. – An electronic copy of a quietly filed lawsuit was unearthed, exposing oil and gas company Lone Pine Resources moving forward with a $250-million North American Free Trade Agreement (NAFTA) lawsuit against Canada over Quebec’s moratorium on fracking for oil and gas underneath the St. Lawrence River.

Fracking, the dirty and destructive process of dislodging gas deposits from shale rock formations, is known to contaminate drinking water, pollute the air, and cause earthquakes. Quebec placed a moratorium in June 2011, which was expanded in fall 2012, banning drilling below the St. Lawrence River until a strategic environmental evaluation was completed.

“Based on the principle of precaution, the Quebec government’s response to the concerns of its population is appropriate and legitimate,” said Martine Châtelain, president of Eau secours!. “No companies should be allowed to sue a State when it implements sovereign measures to protect water and the common goods for the sake of our ecosystems and the health of our peoples,” added the spokesperson of the Quebec based coalition for a responsible management of water.

On September 6, Lone Pine Resources quietly submitted its formal request for arbitration against Canada. Instead of going to a domestic court to challenge Quebec’s moratorium, Lone Pine lawyers will make their case in front of a panel of three private sector attorneys meeting behind closed doors.

“Quebec’s moratorium on fracking is legal and supported strongly by the public. Corporate profit should never get in the way of environmental and public health safeguards. It’s outrageous to even think that we may have to pay Lone Pine not to drill in the St. Lawrence River. Trade rules shouldn’t be used to appease the whims of dirty oil and gas companies,” said Stuart Trew, trade campaigner for the Council of Canadians.

We’re likely to see more dangerous cases like this if trade pacts currently being negotiated are signed into law. For example, the text of the proposed Trans-Pacific Partnership between the U.S., Canada, and 10 other nations, is expected to closely mirror NAFTA’s investment rules, while Canada is in the final stretch for a deal with the European Union (CETA) that would also provide those excessive powers to multinationals.

“This lawsuit – which must be dropped by Lone Pine Resources – highlights just how dangerous investment rules are for democratic decision making and public interest policies. Governments should learn from this and other similar cases and stop writing investment rules that empower corporations to attack environmental laws and policies in private tribunals,” said Ilana Solomon, Director of the Sierra Club’s Responsible Trade Program.

Background:

In fall 2012, energy company Lone Pine Resources announced it planned to challenge Quebec’s fracking moratorium using an investment protection chapter in NAFTA. Lone Pine is registered in Delaware but maintains all its operations in Canada. The Council of Canadians, the Réseau québécois sur l'Intégration continentale (RQIC), the Sierra Club, For Love of Water (FLOW), Eau Secours!, and AmiEs de la Terre responded by collecting signatures on a letter asking Lone Pine to drop plans to sue Canada under the investment chapter of the North American Free Trade Agreement. With each 1,000 new signatures, a letter was sent to Lone Pine executives demanding they abandon the $250-million claim. The groups have collected close to 4,500 signatures.

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