At what price 'white man's money'?

Shawn McCarthy
Globe and Mail
Jul. 21, 2009

The candidates vying to succeed Grand Chief Phil Fontaine pretty much agree that economic development is the key to prosperity for Canada's native people. Many others, however, fear the cost

Each spring, Art Sterritt and his family gather at his wife's ancestral home among B.C.'s Gitga'at people to harvest seaweed, clams and cockles on the shores of Hartley Bay near Kitimat.

The event is more than vacation; it connects the 60-year-old grandfather and his growing family to a way of life that has existed for a millennium.

But the Gitga'at and other aboriginal people on the isolated coast worry about a new and dire threat to that natural abundance that forms the basis of their cultural identity.

Calgary-based Enbridge Inc. plans to build a 1,170-kilometre pipeline to carry oil-sands crude from Edmonton. Double-hulled tankers would navigate 80 kilometres up Hartley Bay to Kitimat to take it the rest of the way to Asia and the U.S. West Coast.

First nations in the region adamantly oppose the tanker traffic, fearful that spills and even heavy wakes from the massive vessels would disrupt the tidal environment that nourishes them.

"The dangers of it are monumental," says Mr. Sterritt, who is executive director of Coastal First Nations, an umbrella group that pursues sustainable economic development for 10 member communities.

"The minute there is tanker traffic, there is damage to a way of life."

But native people also badly need the jobs that would come from building and maintaining the pipeline as well as operating the marine terminal in Kitimat. In fact, the whole town is suffering so badly from the loss of industrial jobs and population that the local hospital may have to close.

Enbridge is offering aboriginal communities not only training and jobs, but the opportunity to own 10 per cent of the $4.5-billion project.

Long excluded from the development of Canada's natural resources, many native leaders now insist their people must take part, and warn that failure to include them could derail projects.

The five candidates in next week's vote to choose a successor to Phil Fontaine as Grand Chief of the Assembly of First Nations have all promised to pursue resource development as a way of alleviating the appalling poverty and social conditions on reserves.

"This represents an enormous opportunity for us," Mr. Fontaine says.

NO CONSULTATION, NO DEVELOPMENT

From the Enbridge project (known as the Northern Gateway) and the proposed Mackenzie Gas Pipeline in the Northwest Territories to the Lower Churchill River hydro development in Labrador and the development of wind power and transmission lines in Southwestern Ontario, energy companies are facing people who are newly empowered as well as assertive. After a series of Supreme Court of Canada decisions, governments now have a duty to "consult and accommodate" first nations before the approval of any development that has an impact on their traditional lands.

"We expect that, if we do this right, there is a real good opportunity to turn the corner in terms of first nations poverty," Mr. Fontaine explains in an interview.

"But it will only occur if our people are trained and we develop a highly skilled, highly mobile work force, and if this legal requirement - this duty to consult and accommodate aboriginal interests - is reflected in policy at all levels of government."

In many cases, the native groups want to become full partners in the developments, and some are pursuing their own projects, most notably renewable energy in Ontario. At the very least, they expect to be fully consulted and to share in the financial benefits that flow from the resource projects on their traditional lands. Although they don't have veto power, they can harass developers with court action unless properly accommodated.

But the push for development has sparked debate within aboriginal communities, pitting those who see development as an answer to the poverty that plagues native peoples against those who fear that, even with aboriginal input, the environmental and cultural impact on their way of life will be too great.

Communities on the B.C. coast, for example, prefer low-impact development opportunities, including eco-tourism, fish farming and sustainable forestry, to the polluting, scarring resource extraction that typically provides jobs in remote areas.

And they make common cause with environmental groups and native protesters who oppose the proposed expansions of oil-sands extraction as a poisonous blight on the land.

However, other first nations remain eager for the income and employment that resource development can offer. They insist that they can work with corporations and government to minimize the impact, even in the oil sands.

This week, the Birch Narrows Dene Nation in northwest Saskatchewan signed an agreement with Calgary-based Oilsands Quest Inc., which hopes to introduce oil-sand extraction to the wheat-field province.

According to Chief Robert Sylvester, the pact offers "new business and employment opportunities for our local residents, and also recognizes that social, economic and environmental impacts need to be addressed."

On the Northern Gateway pipeline, Enbridge is already in talks with 30 of the 50 first nations whose traditional lands would be traversed. The aim is to secure their consent, or at least satisfy the need to "consult and accommodate" before governments can approve the project.

As well, the company has signed agreements with aboriginal communities in Saskatchewan and Manitoba, where its main pipeline carries oil-sands bitumen from Alberta to the United States.

However, one candidate for the AFN leadership, Manitoba Chief Terrance Nelson, has slammed the pipeline companies and the National Energy Board for proceeding with projects over the objections of his Roseau River First Nation. He is urging the AFN to take a militant approach, promoting the use of civil disobedience and U.S. courts to block developments unless aboriginal rights to the land and resources are fully respected.

A long shot to succeed Mr. Fontaine, he says he doesn't want "white man's money," but his rivals are promoting co-operation with companies eager to operate in native territory.

THE EAST ALSO HAS AN ENERGY CASH COW

In the West, the oil industry offers the greatest potential benefits, but the big prize in Manitoba and Eastern Canada is electric-power development.

In Newfoundland and Labrador, Innu leaders are close to a deal for a benefits package from the Lower Churchill development - one that is expected to include a small ownership stake in the project.

In Ontario, the provincial government last fall withdrew its long-term energy plan and told its Ontario Power Authority to conduct more consultations with first nations to ensure their concerns are met. The province's Clean Energy Act will allow native communities to develop their own power projects and sell the electricity to the grid at attractive rates.

The co-operation of aboriginal groups is critical to Ontario's plan to develop renewable sources - the most attractive sites tend to be far from population centres and will require new transmission lines across native land.

Hydro One, the provincially owned transmission company, has had to halt construction of a high-voltage line from Niagara to Hamilton after protesters from Six Nations reserves set up barricades over land claims near Caledonia.

The agency also has negotiated co-operation agreements with Indian and Métis communities along a planned transmission line to Milton that would deliver power from a retooled Bruce Nuclear plant as well as any new wind projects on Lake Huron and Georgian Bay.

First nations are looking to launch their own energy projects as well as benefit from corporate-driven developments. But native leaders warn that governments and companies will have to help them so they can properly consult in planning and maximize their benefits.

The developers will need to be patient, says Angus Toulouse, Ontario regional chief for the AFN, while communities come to grips with the often-overwhelming requirements for expert decision-making.

"There is obviously a desire of industry to move quickly, because time is money," Mr. Toulouse concedes. "But without a reasonable level of resources made available, many first nations simply have no capacity to engage."

They also have little access to capital, so governments will have to find innovative ways to help them take part in projects. But the native communities themselves will need to be patient.

The 4,200-member Walpole Island First Nation has been pursuing a wind-energy project for five years, spending about $800,000 on wind monitoring and other preparations.

Located on the shores of Lake St. Clair in Southwestern Ontario, the band had hoped to construct a 50-megawatt wind farm under the province's former Standing Offer program, but found it impossible to navigate the conflicts between the project's regulations and the federal Indian Act, which governs their community.

The province revamped its renewable energy policy under the Clean Energy Act, and Walpole Island now expects to proceed with a 10-megawatt, five-turbine site on nearby St. Anne's Island at a cost of $35-million.

The Walpole band is negotiating with a joint-venture partner, which will provide half the financing and the expertise in managing a wind project.

As well, they will benefit from a provincial loan-guarantee program for first nations' renewable projects and a "price adder" that will bump up the already-generous tariff being offered by the province.

The band hopes to use the income from the project to assume control of the island's power-distribution company and, economic development officer Lee White says, to subsidize electricity costs for its members.

He warns, however, that the provincial government's well-intentioned plans for native-backed renewable energy will be difficult to achieve, given bureaucratic inertia and the first nation's lack of trained people.

"Maybe we should all be given some Viagra," Mr. White says. "You have to be very patient and stay the course, because there are a lot of things that have to happen before first nations can participate."

YOUNG PEOPLE ARE KEEN - AND IMPATIENT

In many communities, the promise of participation in resource development is being greeted with considerable skepticism, given false starts and broken promises seen in the past.

Younger leaders are embracing the idea that resource development - in partnership with non-native corporations - will help to ease the Third World conditions found on so many reserves, says Mr. Toulouse, the AFN chief for Ontario, who hails from Sagamok Anishnawbek, a community north of Lake Huron.

But they need to see results: "The frustration will grow quickly if youth doesn't see the kind of development that elders tell them is available,"
he says.

And from frustration arises further conflict.

Shawn McCarthy is The Globe and Mail's energy reporter, based in Ottawa.