Outline of History of the Canadian Pacific Railway's Land Grants (Page 2)

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Mineral Rights

Most of the land grants from the government included timber, where such existed, and "all mines and minerals" (except gold and silver, which are reserved by Statute to the Crown). Throughout the so-called Sedimentary Basin, (east of the Rockies and south of the Canadian Shield) in which most of the Company's lands are situated, geologists state that apart from petroleum, natural gas and coal, the chief minerals likely to be encountered are those comprising the ''salt group'' such as salts of potassium, magnesium, sodium, chlorine, bromine, etc., and their compounds; the occurrence of metallic minerals such as iron, copper, etc., usually being confined to the older geological formations.

In the early days when the Company first commenced selling its lands to settlers, no reservations of the mineral rights were made in the agreements for sale or in the subsequent transfers. Likewise, the government did not reserve minerals underlying lands patented to homesteaders. Inasmuch as the Railway company was a large user of coal, and as coal was known to exist under portions of the lands included within the grant, the policy of reserving coal to the Company was soon instituted. Later this reservation was extended to cover Valuable Stone, and still later, about 1905, the reservation was expanded to read ''All Coal, Petroleum and Valuable Stone". It was not until after the formation of the Department of Natural Resources and the establishment by the Company of its own full-time solicitor at Calgary (Mr. G.A. Walker) that the mineral reservation was again expanded to cover ''All Mines and Minerals''. As a result of the foregoing, the areas in which the Company's minerals were retained are approximately as shown below:

Note: In 1948 the Company voluntarily transferred to the Alberta government its mineral rights where these were limited to ''coal'' or ''coal and valuable stone'' underlying approximately 705,000 acres of land, in areas in which no commercially valuable coal was taken in 1953 in respect of approximately 770,000 acres in that Province. The annual savings in mineral taxes as a result of this action were approximately $10,000 and $23,000 respectively. The figures in the above table show the totals remaining after these two surrenders had been made.

Attention should be directed to the fact that the above totals do not include any minerals which the Company may own underlying its right- of-way and station grounds. Although the Department of Natural Resources has been instructed to deal with these rights in any parcel where an application to lease is received, no accurate estimate of the total right-of-way acreage can be made at this time, owing to a recent decision of the Supreme Court of Canada as to the validity of Section 198 Of the Railway Act, which provides that lands purchased for railway Purposes after February 1, 1904 shall not include minerals unless they are expressly conveyed.

A glance at the above figures brings to light the fact that most of the Company's minerals rights lie in Alberta, the reason for this being that it was the last of the three Provinces to be overtaken by the westward push of settlers. To date this has proved very fortunate for the Company, as Alberta has been far more prolific in the production of oil and gas than either Saskatchewan or Manitoba.

As might be expected, early revenue from mineral rights was derived mainly from coal. Revenues from valuable stone have been negligible. Although the Company itself did not engage actively in the production of coal on the Prairies, it granted numerous leases on a royalty basis to producers of coal in the Drumheller, Edmonton and Estevan districts. In the early days the Company made some preliminary investigations in the vicinity of Crowfoot Creek, near Gleichen, but this did not lead to any production of consequence. Actually, the Company did produce commercial coal at Bankhead, near Banff; and for a time at Bienfait, Saskatchewan (property later leased, and ultimately sold); also at Lethbridge when the Galt Mines of the A.R. & 1. Co. were taken over by the Company in 1912.

The Bankhead mine, near Banff, was developed and opened in 1902- 03 and produced coal (a sub-anthracite) for a number of years. It was found, however, that as mining progressed deeper into the mountain, the percentage of large-sized coal (lump) decreased to the point where the operation became unprofitable. This was offset for several years by the installation of a frequenting plant, but the mine was finally closed down in 1923.

About the time of the commencement of the Bankhead operations, investigations were undertaken at Bienfait, Saskatchewan, and a mine (lignite) was opened and operated until the end of 1904. Thereafter, it was leased to the Souris Coal Co. and successively to several other lessees, and finally was sold to the lessee in 1931.

The Galt Mine coal operations at Lethbridge were carried on from 1912 until 1935, when the Company's coal interests in the Lethbridge area were merged with those of the two other major operators in the vicinity, namely, the Cadillac Coal Co., (the Sir Mortimer Davis interests), and Monarch Coal Mining Co., (the H.A. Lovett interests) both of Montreal, into what has since been known as Lethbridge Collieries Ltd., in which the Company has a controlling interest (64.375%).

There was another coal operation which the Company undertook at Hosmer, BC in the Crowsnest Pass. This is dealt with later under the British Columbia Section of this article.

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