The environmental law group Ecojustice is threatening legal action if the Alberta government's inquiry into the funding of oil and gas industry foes continues as is — but Premier Jason Kenney says the reaction confirms his government is on "exactly the right track."

The Vancouver-based Ecojustice issued the warning in a letter to inquiry commissioner Steve Allan and has given him 30 days to respond.

Kenney's United Conservative Party had promised the inquiry before winning the spring provincial election, saying deep-pocketed American charities have bankrolled efforts to block Canadian energy development for years.

In announcing the $2.5-million inquiry this summer, Kenney's newly elected government gave it a mandate to find out how much foreign money has funded environmental campaigns against Alberta oil and gas. Kenney said it would determine whether any laws have been broken and recommend any appropriate legal and policy action.

Alberta Premier Jason Kenney speaks at a press conference in Edmonton on August 7, 2019. Ecojustice is threatening legal action if the Alberta government's inquiry into funding of oil and gas industry foes continues as is. (Jason Franson/The Canadian Press)

Ecojustice says in the letter that the terms of reference lay out a predetermined result and there's a reasonable apprehension the inquiry will be biased against the groups it's investigating.

The group also says the inquiry risks violating rights to freedom of expression and assembly protected under the Canadian Charter of Rights and Freedoms.

Ecojustice adds that the inquiry must be procedurally fair, meaning anyone called before it must be able to cross-examine witnesses and receive copies of documents submitted as evidence, among other things.

It's proposing amendments to the inquiry's terms of reference that would fix some of those issues.

Ecojustice executive director Devon Page likened the inquiry as it stands to a "medieval witch hunt."

"It wasn't about finding the truth. It was about finding witches," he said in an interview.

"This is a political exercise. It's intended to target Canadians who are concerned about climate change and silence them."

'I understand why these groups are hyperventilating,' Kenney says

On a teleconference from New York City on Wednesday, Kenney said he hadn't read the letter but called the response "entirely predictable" and a "regurgitation" of the "laughable" letter sent last week by Amnesty International, which also criticized the inquiry.

"I understand why these groups are hyperventilating," Kenney said.

"These responses confirm that we are on exactly the right track."

Kenney's office followed up with an email pointing to the financial information Ecojustice filed with the Canada Revenue Agency. It shows the group received money from foreign sources, including $1,046,974 from Nov. 1, 2017, to Oct 31, 2018, and $730,984 the year before that.

The inquiry is one plank of the United Conservative government's strategy to fight back against critics of Alberta's beleagured oil and gas industry, which has struggled to get its product to markets as new pipelines are mired in delays.

When Kenney announced the inquiry, he said it would "serve notice that Alberta will no longer allow hostile interest groups to dictate our economic destiny as one of the most ethical major producers of energy in the world."

Allan, the commissioner, is a forensic and restructuring accountant with more than 40 years experience.

His ability to compel witness testimony and records is limited to Alberta, but Justice Minister Doug Schweitzer has said much of the information Allan needs is publicly available and he'll be able to travel outside Alberta to gather more.

The first phase of the inquiry is to focus on fact finding, with public hearings to follow if necessary.

Allan is to deliver his final report to the government next summer.