Concern in NWT about impact of Kevin O’Leary’s Alberta AI data centre

The head of Keepers of the Water says the group’s members “definitely have concerns” with a celebrity-backed AI data centre being planned in northwestern Alberta.

Jesse Cardinal is the executive director of the Indigenous-led coalition, which focuses on water protection within the Arctic Ocean drainage basin.

She said the Wonder Valley AI Data Centre – backed by investor Kevin O’Leary of Dragon’s Den fame – will use “massive amounts of fresh water” from the Smoky River, a major tributary of the Peace River. She said both rivers have experienced low water levels in recent years.

“What’s happening in northern Alberta … I say it’s like the Wild West where the governments, their only sole focus is economic development, extraction, bringing more foreign investors,” she said.

“So their language is so foreign to the way we as Indigenous people view things.”

Cardinal said Gerry Cheezie, co-chair of Keepers of the Water and former chief of Tthebatthie Denesųłiné Nation, is “very concerned” about the Peace River.

Downstream, the Peace River joins the Athabasca River in the Peace-Athabaca Delta to form the Slave River, a tributary of the Mackenzie River.

“We had a conference in March where we had people all the way from the Inuvialuit communities and we’re hearing the same thing, no matter where people come from – that the water levels have declined drastically,” Cardinal said.

According to the NWT government, the territory is seeing improved conditions on some waterways following years of drought.

The NWT’s latest water monitoring bulletin states levels on the Slave, Athabasca and Peace rivers are currently above average for this time of year. The bulletin notes, however, that water levels on the Mackenzie River are still “well below average.”

What is the Wonder Valley AI Data Centre?

US-based developer O’Leary Ventures has promoted the $70-billion Wonder Valley AI Data Centre as “the largest AI computer data centre park on Earth.”

Located in the Greenview Industrial Gateway area in the Municipal District of Greenview, about 50 km south of Grande Prairie, the multi-phase project is expected to produce a total of nine gigawatts of power once complete.

Spanning roughly 65 square kilometres, plans for Wonder Valley include data centre clusters, on-site power generation, and infrastructure for water and wastewater.

The project holds a preliminary certificate to divert up to 24 million cubic metres of water annually from the Smoky River. In a newsletter last month, however, O’Leary Digital said it now expects the project will use less than six million cubic metres of water a year – the amount the Municipal District of Greenview is allowed to withdraw from the Smoky River under an interim water licence.

The Alberta government has determined the AI data centre project does not require a provincial environmental assessment. The project will still require permits for construction.

In a statement to Cabin Radio, a spokesperson for Grant Hunter, Alberta’s minister of environment and protected areas, said the province granted the six-million-cubic-metre interim water licence after a hydrological assessment confirmed water availability in the area.

The statement added the Municipal District of Greenview’s application for a water licence to divert up to 24 million cubic metres of water from the Smoky River per year is under review. The statement asserted that 24 million cubic metres represents approximately two percent of the total annual yield for the Smoky watershed.

The spokesperson said new water licence applications on the Smoky River “have stringent terms and conditions to protect the environment,” including restricting water withdrawals during low periods.

Water and caribou ‘non-negotiable’ in NWT

In the NWT legislature last month, Great Slave MLA Kate Reid queried the potential downstream impacts of the project and questioned how the territorial government could intervene.

The territory has a transboundary water agreement with Alberta for the Mackenzie River basin.

As the project is not going through an environmental assessment in Alberta, Jay Macdonald, the territory’s minister of environment and climate change, said there is currently no avenue for the territory to intervene.

He said, however, he has had “a number of conversations” with the Alberta government and the NWT “will continue to monitor the situation” – including data on flow rates into the territory – and will “participate when the opportunity arises.”

Macdonald acknowledged the project “certainly is a large water consumer” and said water is “an area that’s top of mind” for him.

Later that day, responding to questions from Tu Nedhé-Wiilideh MLA Richard Edjericon about a speaking engagement in Alberta on Arctic development, Premier RJ Simpson told the legislature that water and caribou are “non-negotiable” issues.

“Those are the hills we’re going to die on,” he said.

“We need to ensure the people of the territory are informed and on board with decisions that are going to affect those resources.”

First Nation calls for federal assessment

O’Leary Digital said the Wonder Valley project is in its early planning phases, including technical studies, engagement and regulatory preparation.

The developer expects construction on phase one could start as early as 2027, subject to approvals.

Proponents of the project have said it will provide short-term construction jobs and long-term operations and maintenance employment, as well as local and Indigenous contracting opportunities among other economic benefits.

Supporters have said the AI data centre will have less of an environmental impact than other initiatives previously proposed in the area.

Critics of the project have voiced concerns about environmental and cultural impacts, including heat, noise, emissions and water use.

Some have pointed out that in July 2025, the Municipal District of Greenview declared an agriculture disaster for the livestock industry due to worsening drought and grasshopper infestations.

The University of Calgary has estimated the AI data centre project, which is anticipated to use off-grid natural gas and possibly geothermal power, could produce 25.7 to 30.5 megatonnes of emissions per year.

One of the biggest opponents of the project is the Sturgeon Lake Cree Nation. The First Nation said it learned about the project through a press release, describing a lack of meaningful engagement and consultation that it termed a “cause for serious concern.”

“Our people have traplines in this area, we rely on the water from the Smoky River; and it is one of the few areas accessible to exercise our way of life, which has been systemically eroded by unmitigated cumulative effects resulting from the provincial government’s authorizations of industrial development in our territory,” Chief Sheldon Sunshine wrote in a January 2025 letter to Alberta Premier Danielle Smith.

The First Nation is calling on the federal government to conduct an environmental impact assessment of the project and is challenging Alberta’s decision to grant it a water licence.

“This is a massive project with significant emissions, water use and, most alarming, [could] create a heat island in an area already ravaged by wildfire, drought and climate change,” Chief Sunshine was quoted as saying in a news release.

The Impact Assessment Agency of Canada told Cabin Radio it has not yet received an initial project description from O’Leary Digital to determine whether a federal assessment is required for the project.

In its May newsletter, O’Leary Digital said it had worked to reduce the project’s water use based on feedback from local residents and Indigenous groups.

The company said it will continue to engage with Indigenous communities, share project information and respond to questions, adding that feedback will inform project planning “where reasonably practicable.”

The company said it is advancing environmental studies on air, noise, water and wetlands.

In information published on its website, O’Leary Digital has promised to set aside land for a wildlife preservation area and to mitigate emissions using carbon capture and storage technologies. The website provides little detail about those plans.

Neither O’Leary Ventures nor the Sturgeon Lake Cree Nation returned Cabin Radio’s requests for comment.

The Municipal District of Greenview declined to comment.

AI data centre rush

Data centres are facilities housing the computer systems and associated components that power cloud systems, streaming services and websites.

Recent research by York University estimates there are currently 192 operational data centres across Canada with a combined capacity of 1.6 gigawatts and average capacity of 11.3 megawatts.

That study found ownership of those facilities is predominantly foreign, with US-based companies owning more than half of active facilities.

Other reports have asserted there are upward of 300 operating data centres in Canada.

Hyperscale data centres used to power large language models, such as ChatGPT, Gemini and Claude, are relatively new. These AI data centres require enormous amounts of power and water compared to traditional data centres.

The federal government is pushing for more large-scale AI data centres to be built in Canada as a means to assert digital sovereignty.

The study by York University said 143 proposed AI data centres have been announced across the country, with a combined planned capacity of 13.2 gigawatts and an average capacity of 116 megawatts – more than 10 times the average of currently active sites. The study said data centres proposed in Alberta account for 93 percent of planned capacity.

The federal government’s new national artificial intelligence strategy promotes Canada as a competitive place for AI data centre developers due to its electricity grid and northern climate reducing the amount of water needed for cooling.

But the University of Calgary has said air-cooled systems are less efficient and require more power than liquid-cooled systems.

Data centre pushback

There has been significant pushback to planned AI data centres in communities across Canada, including in British Columbia, Saskatchewan, Ontario and New Brunswick. Manitoba Premier Wab Kinew has said the province will reject a proposed AI data centre southeast of Winnipeg as its impacts on the environment and community outweigh the benefits.

An e-petition backed by Edmonton Strathcona NDP MP Healther McPherson – calling on the House of Commons to impose a federal moratorium on proposed hyperscale AI data centres in Alberta – had about 8,700 signatures at the time of writing.

In a recent Angus Reid poll of 1,803 Canadian adults, 46 percent of respondents said Canada needs domestic AI infrastructure to keep digital services under Canadian control. Sixty-eight percent said they would oppose a large data centre being built within a few blocks of where they live.

Cardinal, at Keepers of the Water, expressed concern that Prime Minister Mark Carney appears to be reducing environmental regulation to fast-track major projects across Canada, while Alberta Premier Smith plans to increase oil and gas production in the province.

She said Canadians are already experiencing the impacts of climate change, including drought and heat waves, while resource extraction projects haven’t delivered on prosperity promises as the gap between the rich and the poor gets wider. She said Canada needs to quickly diversify its energy sources.

“This is a time where we should be making decisions based on where we’re at right now, not based on somebody’s financial reports and the financial piece of it,” she said.