Aboriginal rights need clarity for LNG

Ravina Bains is associate director of Aboriginal policy studies at the Fraser Institute

Last summer I wrote that the Supreme Court’s Tsilhqot’indecision, which for the first time granted aboriginal title outside an Indian reserve, was going to be a real game changer and would “increase uncertainty in Canada’s natural resource sectors in areas lacking treaties with First Nations.”

Since then we’ve seen First Nations in British Columbia serve eviction notices to corporations and take resource companies to court over title claims.

Most recently, the Lax Kw’alaams band rejected a billion dollar deal from Pacific NorthWest LNG, which is majority-owned by Petronas which itself is owned by the Malaysian government, for a liquefied natural gas (LNG) project proposed on Crown land on Lelu Island near Port Edward.

The rejected deal would have provided money and land and stretch over 40 years.

Despite the rejection, Premier Christy Clark said that project will move forward, although negotiations are ongoing with the band.

This project, if it eventually breaks ground, could net up to 4,500 construction jobs and an investment of $11 billion in B.C.

All of this uncertainty, spurred by last summer’s court decision, has reduced confidence in B.C.’s mining sector.

For example, in 2014, 50 per cent of respondents to the Fraser Institute annual survey of mining company executives indicated that land uncertainty was either a strong deterrent to investment or a reason to simply not invest, up from 32 per cent in 2013.

Increased uncertainty also threatens LNG investment in B.C. The LNG sector is expected to yield great returns for British Columbians if projects come to fruition.

The provincial government, which has promised a legacy fund, states that if five LNG plants are built, they would add$1 trillion to the province’s GDP, more than $100 billion in provincial tax revenue and draw $175 billion in new investment into the province.

Critically, this increased uncertainty isn’t just an issue for project proponents but also for First Nations communities.

The Tsilhqot’in decision made it very clear that the Crown could override aboriginal rights and allow a project to proceed on aboriginal title land without the consent of the First Nation; but only if the government deems the project in the greater public interest. In other words, there’s a chance that if the Lax Kw’alaams band is able to prove title (an inherent right to land or territory) on the project site, the LNG facility would proceed without their consent.

And without an agreement between the First Nation and Pacific NorthWest LNG, despite Premier’s Clark recent announcement, this scenario would leave the First Nation out of potential revenues and jobs generated from the project.

This scenario could be avoided, and current uncertainty could be mitigated, if the provincial government clarifies which projects, if any, are in the greater public interest, and therefore, can override aboriginal rights.

Apparently, the provincial government believes a negotiated settlement between Pacific NorthWest LNG and Lax Kw’alaams First Nation is within reach.

But if the deal falls through, the province will have to weigh aboriginal rights against potential benefits from the LNG project.

So clarity is key. First Nations in B.C., like the Lax Kw’alaams band, deserve greater clarity on what, if any, projects trump aboriginal title rights.

Companies looking to invest in B.C. deserve greater clarity on the willingness of the government to support projects on aboriginal title land – without the consent of First Nations.

And all British Columbians should know whether or not LNG projects, which promise to add a trillion dollars to the province’s GDP, will come to fruition.

Ravina Bains is associate director of Aboriginal policy studies at the Fraser Institute.

She is also the author of A Real Game Changer: An Analysis of the Supreme Court of Canada Tsilhqot’in Nation v. British Columbia Decision. The study is available at www.fraserinstitute.org

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