Athasbasca Oil shares plunge as project opponents allowed appeal

Fri Oct 18, 2013 3:03pm EDT
 
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CALGARY, Alberta Oct 18 (Reuters) - Shares in Athabasca Oil Corp plunged more than 10 percent on Friday after the Alberta Court of Appeal ruled that an aboriginal community would be allowed to challenge regulatory approvals for an oil sands project planned by the company.

Athabasca shares were down 73 Canadian cents to C$6.25 by mid afternoon on the Toronto Stock Exchange.

The company said in a statement on Friday the court had allowed the Fort McKay First Nation to appeal the Alberta Energy Regulator's (AER) approval in April of the Dover Commercial Project, a thermal oil sands development co-owned by the company and PetroChina that could eventually produce as much as 250,000 barrels per day of bitumen.

However, Athabasca said it believes its approvals are valid despite the ruling.

"Leave to appeal is not a judgment on merits of the case and does not impact the validity of the AER approval, but is restricted to a specific question of law or jurisdiction," the statement said. "The appeal on the specific question will be heard at a later date, yet to be determined."

The First Nation, a community of about 700, north of Fort McMurray in the heart of the Athabasca oil sands region, has supported development of the resource. However, since the Dover project abuts on its traditional lands, the First Nation asked the regulator to set a buffer zone around an area it considers a key wildlife and fish habitat, a proposal the regulator rejected. (Reporting by Scott Haggett; Editing by Marguerita Choy)