Nisga’a find favour with revenue sharing commitment

THE prospect of Avanti Mining reviving a closed molybdenum property

THE NISGA’A will vigorously pursue the provincial government’s commitment to sharing revenues from mineral taxes.

Speaking last week, Nisga’a Lisims Government president Mitchell Stevens said a revenue sharing model not only recognizes aboriginal interest in resources, but is a good business practice.

“It provides certainty,” said Stevens of a defined revenue sharing system. “It’s what I’ve been saying all along. It’s about economics. Uncertainty does not make for good economics.”

The comments follow those made last week in Toronto by Randy Hawes who spoke at a mining conference in his capacity as the provincial minister of state for mining.

“Our support for revenue sharing is unequivocal. We are determined to continue engaging with First Nations as fully as possible,” said Hawes.

“For the benefit of both the province and the First Nations, it is vital that First Nations play a significant role in the mining industry,” he added.

Mineral taxation revenue sharing is particularly relevant for the Nisga’a as several mining companies have projects in advanced stages.

One, Colorado-based Avanti Mining, wants to reopen a molybdenum property at Kitsault at the end of Alice Arm on the north coast.

It is within Nisga’a traditional territory but not within the Nisga’a treaty lands.

The company had a public meeting in Terrace last night, one of the requirements along the road leading to a formal application for environmental certification.

Depending upon approval, financing and signing up customers, Avanti is so far forecasting a mine life of 16 years, providing direct employment for 350 people. A 650-person construction workforce would be needed over a 25-month period.

Stevens says Avanti favours a tax revenue sharing program.

“We put forward our proposals and they’ve been very, very receptive,” said Stevens of sessions between Avanti officials and the Nisga’a Lisims Government.

Stevens did add that the Nisga’a are not yet in a position to decide whether they should support Avanti’s mine plan or not because the project has to undergo a full environmental evaluation.

Avanti chief executive officer Craig Nelson says the company has no trouble supporting a Nisga’a plan to be included in taxation sharing agreements with the province.

“In general we support it,” said Nelson. “This can be a huge benefit to proponent companies in general. Companies already sign impacts and benefits agreements. If it were all to fall on a company’s shoulders, that would be a huge burden and that could affect the economics of a project.”

Nelson said revenue sharing agreements with the province also add to the certainty of the steps needed in the development of  a mine.

Nelson is familiar with taxation revenue sharing agreements with First Nations because he sits on the board of New Gold, the company that has the New Afton copper-gold-silver mine near Kamloops.

Last year, the province signed an agreement with the  Tk’emlups and Skeetchestn communities to provide $30 million over 20 years from the mine’s taxation base. That’s nearly a third of the total revenue the province expects to receive.

The province signed a second agreement, also last year, with the McLeod Lake Band, providing it with between $35 million and $40 million over the anticipated 20-year life span of the Mt. Milligan gold and copper mine now being built 155km northwest of Prince George.

The overall provincial plan is that revenue sharing won’t be a cost to a mining company and will instead be decided by agreement between itself and a First Nation group or groups.

The amount of revenue shared will be based on mine size, and the nature and interests of First Nations involved.

Impact benefits agreements are arrangements between First Nations and mining companies and involve job placements, business opportunities and community assistance.

 

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