REASONS FOR DECISION MINISTERIAL APPROVAL PURSUANT TO SECTION 15(1)(a) THE ENVIRONMENTAL ASSESSMENT ACT

SASKATCHEWAN WATER CORPORATION BUFFALO POUND NON-POTABLE WATER SUPPLY SYSTEM EXPANSION PROJECT

Introduction

The Environmental Assessment Act (hereinafter called the Act) states that a person shall not proceed with a development (as defined in the Act), until ministerial approval has been received. It further sets requirements for a process of Environmental Impact Assessment (EIA) intended to inform the Minister of Environment (hereinafter called the Minister) of the potential impacts of a development prior to making a decision regarding the development.

In February 2013, the Water Corporation (hereinafter called SaskWater, the Proponent) submitted a project proposal to the Environmental Assessment Branch (EAB) to develop a regional non-potable water supply system from Buffalo Pound Lake to potential customers in the Belle Plaine Industrial Corridor and other areas of southern Saskatchewan. The project proposal was sent to the Saskatchewan Environmental Assessment Review Panel (SEARP) for technical review. Following the technical review, the project was determined to be a “development” under section 2(d)(ii) of the Act. SaskWater was therefore required to conduct an EIA and submit findings in an Environmental Impact Statement (EIS).

In September 2014, the Proponent submitted the final EIS to the EAB seeking approval under section 15(1)(a) of the Act. The EIS underwent both technical review and a 60-day public review.

I am therefore satisfied that the requirements of the Act have been met.

Background

The proposed regional non-potable water supply system is designed to meet current industrial demand of 96 million litres per day (ML/d) consisting of 60 ML/d to the proposed Vale Potash project at Kronau, and 36 ML/d for other existing water commitments and anticipated future demands. The water delivery system has the capacity to expand to meet future demand of up to 168 ML/d.

The project includes installation of a breakwater and water intake in Buffalo Pound Lake, construction of a pump house and booster station, and a 93 km pipeline south through the Belle Plaine Industrial Corridor and east to the proposed Vale Potash Kronau site. The construction

SaskWater Buffalo Pound Project 15(1)(a) – Reasons for Decision Page 1 of 6 EAB 2013-002

of the water intake, breakwater, and pump station is anticipated to be completed in approximately 26 months. Upon completion of intake and breakwater construction, estimated to have a footprint of 10,000 square metres (m2), SaskWater will recontour the shoreline using riprap, or other erosion control materials, to prevent long-term erosion and sedimentation. The Proponent will also implement mitigative measures that will limit in-water works and fish habitat disruption during future capacity upgrades. Decommissioning and reclamation activities will include the removal of the intake, pump house, and booster station in accordance with regulatory requirements at the time.

Environmental Assessment

Public notice of the EIA was first given in July 2013. In seeking approval for the development, SaskWater conducted an EIA in accordance with the Act. The Proponent prepared and submitted the initial EIS entitled “SaskWater Buffalo Pound Non-Potable Water System Expansion Project: Environmental Impact Statement” to the Ministry of Environment (the ministry) in December 2013.

The EIS underwent technical review by SEARP and was found to be deficient in the information provided in various sections, which led to additional information being requested from SaskWater prior to the EIA proceeding to the public review phase.

The Proponent subsequently submitted a revised EIS in September 2014 that satisfied the requests for additional information. The final EIS (hereinafter called "the Statement") and the technical review comments document prepared by the EAB were then made available for public review from December 13, 2014 to February 12, 2015 pursuant to Section 11 of the Act. No comments were received from the public during this period.

Having made my decision to issue a ministerial approval, the Act requires me, pursuant to subsection 15(2), to state the reasons for the decision.

Reasons for Decision

Potential Impacts

The Statement submitted by the Proponent describes the development and its potential adverse impacts on the environment. Potential impacts considered during the EIA include: surface disturbance from pipeline, intake and associated infrastructure construction; effects to hydrology and the aquatic environment during construction and operation of the project; and effects on heritage resources.

Terrestrial Environment

The proposed intake and associated infrastructure is adjacent to other developments which include an existing water intake and pump station at Buffalo Pound Lake that supplies non-potable

SaskWater Buffalo Pound Project 15(1)(a) – Reasons for Decision Page 2 of 6 EAB 2013-002

water to the Mosaic Belle Plaine potash mine, Terra Grain ethanol plant, and Yara Belle Plaine fertilizer plant; the Buffalo Pound Water Treatment Plant; and Buffalo Pound Provincial Park. In addition, the area surrounding the development is primarily agricultural land with a few remnant native habitat patches. As a result, the existing current condition of the intake site reflects an area previously disturbed by human and industrial activities. Although surface disturbance will be required for installation of the pipeline, SaskWater has committed to minimizing pipeline length to limit potential disturbances, paralleling existing right-of-ways whenever possible and avoiding known sensitive areas. The Proponent has also committed to developing an Environmental Protection Plan (EPP) prior to permitting to address construction mitigation and environmental monitoring for activities including those on native prairie.

SaskWater’s vegetation surveys identified provincially listed plant species; however, no Committee on the Status of Endangered Wildlife in Canada or Species at Risk Act listed species were observed within the development footprint. SaskWater has committed to implementing measures when working in areas of known infestation of the observed noxious weed species leafy spurge (Euphorbia esula) to prevent spreading it into new areas. The Proponent has also committed to avoiding sensitive areas when selecting pipeline route; utilizing salvaged topsoils to enhance re-vegetation; and re-seeding with appropriate seed mixes to prevent significant impacts to vegetation communities. Additional rare plant surveys will be conducted by SaskWater prior to construction and if species are located, the Proponent has committed to developing appropriate mitigation in consultation with the ministry.

Wildlife surveys conducted by the Proponent located several sensitive, rare, or endangered species within the development area. SaskWater has committed to conducting additional breeding bird surveys prior to construction of any component that will occur in any native habitat, environmentally sensitive sites, or other areas potentially utilized for nesting activities. Survey results will be submitted to the EAB and the Saskatchewan Conservation Data Centre. The Proponent also committed to developing and submitting a site-specific mitigation plan to the EAB based on results of surveys, and acknowledged that changes to some project parameters may be required in certain situations to avoid impacts to sensitive, rare, or endangered species.

Based on mitigations developed to minimize impacts to land, vegetation and wildlife habitat and the disturbed nature of much of the project area, no significant residual impacts to the terrestrial environment are anticipated.

Surface Water Environment

The proposed pipeline crosses Wascana Creek, River and a number of smaller watercourses, some of which were modified by agriculture and contain no fish habitat. The construction and installation of the proposed pipeline at watercourse crossings can affect fish and fish habitat by temporarily altering surface water quality and modifying physical habitat features (e.g., siltation of bottom substrate). SaskWater has committed to using low impact

SaskWater Buffalo Pound Project 15(1)(a) – Reasons for Decision Page 3 of 6 EAB 2013-002

pipeline installation methods to avoid impacting watercourses in addition to implementing appropriate follow-up monitoring and mitigation for inadvertent disturbances.

Information presented in the EIS also assessed the overall residual effects and potential for cumulative effects of the water diversion for this development. Water Security Agency (WSA) manages water levels and discharges in the Qu’Appelle River System including Buffalo Pound Lake. A hydrological model of the Qu’Appelle System, developed by WSA, was used to assess development related impacts to hydrology and the aquatic environment. Model inputs considered the overall water demand in the system and the cumulative effects of multiple water withdrawals on Buffalo Pound Lake and downstream areas. The model results indicated that the initial phase of the development, which involves diversion of up to 96 ML/d, is expected to have no significant impact on hydrology or fish and fish habitat based on the limited predicted impacts at maximum capacity. If the development was expanded to maximum capacity (168 ML/d), there would be a slight change in water levels within Buffalo Pound Lake, but levels would remain in the defined range set by WSA as operating limits and would not be expected to impact aquatic habitat in the lake. Diversion of water for the development could also result in a decrease in average Buffalo Pound Lake outflow rates impacting a 3 km section of the Qu’Appelle River channel immediately downstream of Buffalo Pound Lake to the confluence of the Moose Jaw River. However, the decrease in flow rate downstream would be compensated by inflows into the Qu’Appelle System from the Moose Jaw River and Wascana Creek. Moreover, the 3 km section of the Qu’Appelle River is flat, muddy and slow moving, without any known or suspected spawning habitat.

Several factors will help limit the impacts of potential changes to hydrology and aquatic habitat downstream of Buffalo Pound. The anticipated increase in water inflows from in response to the diversion are expected to help compensate for the reduction in flows, maintain desired water levels and sufficiently mitigate potential effects on fish and fish habitat. Planned channel maintenance activities to improve channel capacity in the upper Qu’Appelle River will increase the ability to manage flows and further reduce the potential for the proposed water diversion to impact hydrology or aquatic habitat should the project expand to full capacity. WSA is also exploring the future development of additional conveyance works upstream of Buffalo Pound thereby limiting reliance on existing storage capacity.

Based on the conservative assumptions in the hydrological model used in the EIS, the limited extent of impacts at the proposed maximum capacity and potential future water management options including enhanced conveyance upstream of Buffalo Pound, no significant impacts to aquatic habitat or aquatic organisms are anticipated to result from the development.

Heritage and Socio-Economic

SaskWater conducted four heritage resource impact assessments along the pipeline right-of- way and at the water intake structure to identify potential effects on heritage resources resulting from the development. The study identified three nearby heritage resources with two requiring mitigation measures. SaskWater has committed to protecting the identified heritage resources

SaskWater Buffalo Pound Project 15(1)(a) – Reasons for Decision Page 4 of 6 EAB 2013-002

by marking them for avoidance during construction activities. Although there is low heritage potential in the area, SaskWater will develop a management plan for unanticipated archaeological or heritage resources discovered during construction.

SaskWater recognizes that the construction of the pipeline and booster station on agricultural land has the potential to affect agricultural land users. SaskWater is committed to discuss route and landowner concerns as well as develop any required landowner compensation plans to address any loss of production during construction. Potential changes to water levels in Buffalo Pound were the principal concern of stakeholders during information sessions. Information in the EIS indicates flows in the Qu’Appelle Rover can be managed to prevent significant impacts to lake levels or users in Buffalo Pound.

SaskWater has adequately examined and addressed all the heritage and socio-economic impacts of the development. Based on the findings, I am satisfied by the Proponent’s assessments and expect the mitigations proposed to prevent or minimize impacts.

Engagement Activities

The Proponent carried out extensive engagement activities with the public and First Nation and Métis people. Primary concerns raised by First Nation and Métis communities were centered around potential impacts of the proposed water diversion on aquatic habitat or fishery resources used to practice traditional uses in Buffalo Pound and downstream areas along the Qu’Appelle River system. Based on hydrological modelling results, the quantity of water diverted at maximum capacity for the project would only cause minor changes to the hydrology of lakes and rivers downstream of Buffalo Pound and levels would remain within the normal range for the system. No significant impacts to fishery resources or other aquatic ecosystem components are anticipated to result from this change and no impact to the ability to access Buffalo Pound and downstream areas of the Qu’Appelle River system for traditional use is present based on the EIS. As such, no DTC was triggered for this development.

The public review period for the EIA, provided an additional opportunity to review development details and provide comments. SaskWater has committed to ongoing engagement activities as required through the subsequent licensing and permitting phase. The EIS adequately addressed the concerns raised during engagement activities and no comments were received through the public review period.

Conclusion

The Ministry of Environment and review agencies are satisfied that, if the mitigative and environmental protection measures outlined in the EIS are implemented, adverse effects can be minimized and benefits enhanced. This conclusion is based on the Proponent’s commitments as documented in the Statement; on the ability of the Minister of Environment to impose specific conditions at this time; and on the knowledge that additional environmental protection requirements can be imposed through terms and conditions forming part of permits and

SaskWater Buffalo Pound Project 15(1)(a) – Reasons for Decision Page 5 of 6 EAB 2013-002

licences required by provincial legislation.

I have concluded that any adverse environmental effects associated with SaskWater’s Buffalo Pound Non-Potable Water System Expansion Project can be eliminated or minimized. Approval under the Act, therefore, has been granted to the Proponent for the development as described in the Statement.

Ministerial approval for the development includes terms and conditions designed to promote the elimination and control of adverse environmental effects associated with the development. Included are requirements that the Proponent:

(a) proceed with the development in accordance with the Statement;

(b) provide notification of any change;

(c) follow the requirements of other laws.

These conditions, plus the measures proposed in the Statement and the regulatory framework applicable to the development, now and in the future, are adequate to address all issues related to the development.

Dated at Regina, Saskatchewan this 18th day of March, 2015

Original signed by: Scott Moe Minister of Environment

SaskWater Buffalo Pound Project 15(1)(a) – Reasons for Decision Page 6 of 6 EAB 2013-002