Challenges remain, but native-industry co-operation continues
by Greg Klein
Not even a billion-dollar offer could win native support for the Pacific NorthWest liquefied natural gas proposal in British Columbia. News that the Lax Kw’alaams band rejected Petronas’ 40-year, $1.14-billion deal suggested aboriginal agreement constitutes an insurmountable barrier to development. But, as a non-profit advocacy group points out, what the band actually opposed was the terminal location. The Lax Kw’alaams council stated it’s otherwise still open to the project. Further accentuating the positive—while acknowledging the challenges—Resource Works released a new report on May 14, Becoming Partners: A Decade of Progress in Aboriginal-Industrial Relations in B.C.
Speaking with eight people active in native negotiations, author David Jordan found several success stories, lots of room for improvement and an understanding that the province has entered a new era of development. Courts led the way, although with inadequately explained admonitions to “consult.” Governments followed by rejecting projects when consultation failed. That left industry and aboriginals to sort matters out themselves, a problem intensified by B.C.’s unresolved land claims. Maybe the most important lesson learned is the importance of aboriginal engagement right from the outset.
With natives on side, regulatory hurdles fall, stated one source. Referring to an agreement between northern B.C.’s Haisla Nation and Chevron Canada, Roger Harris told Jordan the project sped through the regulatory process. “Once the Haisla and Kitimat LNG agreement was in place it was less than six months, by the feds and the province. The bureaucrats couldn’t sign it off fast enough when they knew that there were no longer any first nation issues to deal with.”
A partner in the public affairs firm Harris Palmer and former B.C. forestry minister, he added, “The value the band will bring to the table by getting them to support you will save you millions in the regulatory process, both in the beginning and on the ongoing operation, because you’re always needing a permit to do something. And having these guys as partners makes the government just go away.”
The bureaucrats couldn’t sign it off fast enough when they knew that there were no longer any first nation issues to deal with.—Roger Harris, of public affairs firm Harris Palmer
It’s thanks to its government, however, that B.C. leads Canada in direct revenue sharing. An initiative that helped win support for a number of mining projects, the program began in 2013 with an agreement between two native bands and New Gold’s (TSX:NGD) New Afton mine. Joint ventures or other partnerships often accompany the agreements.
While Harris blames any failure to agree solely on industry, other respondents acknowledge challenges from the native side too. One problem is that band administration “can be cleared out” when a new council gets elected, said Bruce Falstead, manager of aboriginal initiatives for FortisBC.
“People who have institutional knowledge and have been around for a while get shuffled out in favour of nepotism. We couldn’t possibly do business if at Vancouver City Hall half the people got fired and other people got put in every four years. That’s exactly what’s going on and it’s not being addressed.”
Another challenge is inexperience, which holds back some native communities from taking part in projects themselves. Some “have set aggressive targets for developing industrial capacity,” Jordan stated, “but the vast majority of the approximately 200 first nation communities in the province have no experience in resource development; some have chosen not to actively pursue developing that capacity, and those that have made it a priority face the daunting task of building industrial capacity from scratch.”
Among the success stories is the McLeod Lake Indian Band, which runs the Duz Cho group including a road-building company and the province’s third-largest logging outfit. McLeod Lake has now partnered with two other bands to pursue even bigger contracts.
Companies and first nations want to see the same thing happen. They want to see value generated off of land that doesn’t see value being generated yet.—John Jack, Huu-ay-aht
First Nations councillor
A former mines minister now working for a number of resource companies including the Duz Cho group, Blair Lekstrom attributes McLeod Lake’s success to merit. “Many feel entitled to the work because they’re first nation commercial entities,” he said. “We’ve never taken that approach; we will earn the work through quality of work and competitive price.”
Should a band lack experience to negotiate, Falstead stated, FortisBC will pay the community “to hire the expertise that you need in order to engage with us.”
But he calls on government to help those who find themselves swamped with offers. Falstead knows of bands getting 2,000 inquiries a year. “When you get that many requests you can’t effectively respond, so it creates a risk for the company, it creates a risk for the government, and first nations don’t get to be properly heard because they don’t have the ability to respond.”
Overlapping land claims present further problems. But they’re not insurmountable. That fact was demonstrated by what Jordan calls an “historic watershed,” the 2013 agreement between 15 bands and Apache Canada over the 463-kilometre Pacific Trail pipeline proposal.
“Companies and first nations want to see the same thing happen,” explained Huu-ay-aht councillor John Jack. “They want to see value generated off of land that doesn’t see value being generated yet…. Why and whether it gets done is a question of will and communication and relationship-building.”
Jordan credits LNG proponents with bolstering B.C.’s new era of co-operation. He calls last year’s completion of B.C. Hydro’s 340-kilometre Northwest Transmission line “a major infrastructure project that wouldn’t have been possible without the co-operation of the Tahltan and Iskut first nations.” His report notes several native-owned logging companies as well as native participation in 28 clean energy projects. Jordan also lists at least 15 native agreements for mines and mining proposals.