Sierra Club Canada Foundation et al. v. Minister of Environment and Climate Change Canada et al.

The Applicants, three environmental non-profit organizations, sought judicial review of the federal Minister of Environment and Climate Change’s decision approving the Bay du Nord offshore oil project under the Canadian Environmental Assessment Act, 2012. They argued that the environmental assessment was deficient because it failed to assess downstream greenhouse gas emissions and the marine shipping of oil from the project, and that the Crown had breached its duty to consult the Mi’gmawe’l Tplu’taqnn Incorporated (MTI), which represents eight Mi’gmaq communities in New Brunswick.

In 2023, the Federal Court dismissed the application, finding that the Minister reasonably relied on the Agency’s report and that the Crown had fulfilled its duty to consult. On the failure to consider the impacts of downstream GHG emissions and marine shipping, the Court found that downstream greenhouse gas emissions were not within the legislative authority of Parliament, as they could occur anywhere in the world and for various purposes, and the Impact Assessment Agency of Canada (“Agency”) would be speculating if it tried to assess them. The Court also found that the Agency’s decision was consistent with previous regulatory decisions that did not require the consideration of downstream GHG emissions, and the Agency had a wide margin of appreciation in determining the scope of the project. On the failure to consult, the Court found that the Crown had met its duty to consult before reaching the decision under review. The Court held that the Agency had reasonably determined the degree of consultation required based on the low level of potential impacts and the unlikeliness of such impacts to the rights held by the groups represented by MTI, and further found that the Agency had provided MTI with multiple opportunities to raise their concerns and provide comments, which were considered and responded to by the Agency and the Minister. The Court found that the Crown was not required to agree with the concerns raised by MTI or to reach agreement or perfection in the consultation process.

The Applicants appealed. In Sierra Club Canada Foundation v. Canada (Environment and Climate Change), 2026 FCA 110, the Federal Court of Appeal dismissed the appeal and affirmed the Federal Court's reasoning. The Court agreed that the Minister reasonably relied on the Agency's report and that, under the Canadian Environmental Assessment Act, 2012 and existing Federal Court of Appeal precedent, the assessment was not required to evaluate downstream greenhouse gas emissions, whose extent depended on the uncertain destination and end use of the extracted oil and was therefore speculative. It likewise agreed that the Agency reasonably confined its assessment of marine shipping to activities within the Project Safety Zone, distinguishing the Tsleil-Waututh Nation case because broader marine transportation would occur far offshore, beyond Canada's territorial jurisdiction, and depended on uncertain future shipping routes. The Court further agreed that the Crown had adequately discharged its duty to consult MTI. In observations intended to provide "practical assistance" for future environmental assessments and Indigenous consultation processes, the Court emphasized that participants must raise concerns in a timely and meaningful manner while the decision-maker still has an opportunity to address them, explaining that delay or lack of diligence in raising an issue may signal on judicial review that the issue was not sufficiently important to render the administrative decision unreasonable.