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Canadian green group splits, thumbs nose at Ottawa

CALGARY, Alberta (Reuters) - A Canadian environmental group has split in two as a way to keep up public opposition to projects such as Enbridge Inc’s Northern Gateway oil pipeline to the West Coast, while avoiding moves by Ottawa that threatened its previous charitable status.

Officials with ForestEthics Canada, a staunch opponent of the C$5.5 billion ($5.6 billion) pipeline, said on Tuesday one segment will keep on working on environmental projects and agreements as a way to adhere to tighter enforcement of rules that limit the political action of charitable groups.

The other, which expects funding from donors that support its cause for reasons other than garnering tax receipts, will focus all efforts on advocacy.

ForestEthics Canada also announced that high-profile lawyer Clayton Ruby will be a director of the new ForestEthics Advocacy.

The Conservative government of Prime Minister Stephen Harper has been highly critical of ForestEthics and similar groups, saying their members are bent on preventing any and all developments aimed at bolstering energy production, by stacking public hearings and launching publicity campaigns.

In its March budget, the government said it will crack down on political activity by charities as a way to limit such activity. On Tuesday, it further angered green groups with details of plans to streamline environmental reviews.

“The government applied that people in the environmental community, or had the nerve to act or donate to environmental groups, were really unpatriotic - potential terrorists in fact,” Ruby told reporters on a conference call. “The suggestion is that this is beyond the Canadian tolerance. So the government then moved to announce an C$8 million special funding operation in the last budget to audit charities.”

Under regulations, charities cannot dedicate more than 10 percent of their money to political activities.

For the past eight years, ForestEthics received some of its funding from Tides Canada, an organization that provides financial and management services to various charitable groups.

Tides Canada said on Tuesday it backs the reorganization of ForestEthics, but will no longer be able to provide funds.

“Whether you agree or disagree with environmental organizations, Canada is a democracy and all voices should be heard,” Tides Canada Chief Executive Ross McMillan said in a statement. “We support ForestEthics in making a bold move to speak out on behalf of Canada’s ecosystems and communities.”

Editing by Peter Galloway