Can Western Canada’s energy sector earn the trust of First Nations?

Martin Louie | BCBusiness
Martin Louie, Chief of the Nadleh Whut’en First Nation.

Now more than ever, Western Canada’s energy sector needs to earn the trust and consent of First Nations if it hopes to expand its pipeline infrastructure

Martin Louie, chief of the 500-member Nadleh Whut’en First Nation, stands in a gravel-strewn clearing overlooking Fraser Lake in B.C.’s Northern Interior. Strands of long, greying hair flutter across his eyes, catching on the thin creases in his face. A few dozen people, squinting into the late-August sunlight, watch as the chief begins to speak, including a handful of teenagers holding traditional drums and grandmothers watching over their grandchildren. Among the gathered are nine men standing in a semi-circle facing Louie—chiefs and other leaders who represent some of the nearby First Nations, including the Tsilhqot’in, Wet’suwet’en and Gitxsan. Five of the men wield ceremonial hatchets made with moose hooves.

This is a peace-accord ceremony, intended to promote goodwill among neighbouring bands that had long ago fought wars against one another, but it’s also a call to arms as they prepare to confront the B.C. government over resource development on their ancestral lands. For two days, aboriginal leaders have met amidst the spruce forests of Nadleh Whut’en territory west of Prince George to draw up negotiation plans for a key meeting with the government. “It’s time we stood up. It’s been too long that we never stood together,” Louie exhorts his peers. He speaks in a calm, defiant voice that remains steady despite gusts of wind that threaten to drown him out. “We used to fight with weapons. Now we fight with paper.”

First Nations across B.C. are gearing up for a series of land-title claims and resource negotiations that could determine the fate of the province’s ambitious plans to turn B.C. into a global energy powerhouse. Markets in Asia are hungrily eyeing vast, newly viable natural gas reserves in northeastern B.C. and northwestern Alberta, with some estimates indicating the shale basins surrounding Dawson Creek could yield a quarter of the world’s marketable natural gas—nearly 3,000 trillion cubic feet (Tcf).

Getting that fuel to paying customers will not be easy. The shale gas boom in the U.S. has imploded demand for the fuel in Canada’s traditional markets south of the border, and cashing in on Asian demand will require building a web of pipelines crisscrossing B.C. from wellheads near the Alberta border to liquefaction and shipping terminals on the coast near Kitimat and Prince Rupert. Those plus the contentious Northern Gateway bitumen project and a dozen other pipelines are now under consideration in B.C., with the extraction, transport and shipping all affecting land and water resources that First Nations have used for millennia. Three of the gas pipelines, plus Northern Gateway, are proposed to run through the Nadleh Whut’en’s traditional territory.

In the old days, companies planning pipelines—or other industrial projects, for that matter—would simply avoid building on the small fraction of land designated as reserves under the federal Indian Act and ignore any stake First Nations may have had on other areas. But over the past 50 years, B.C. First Nations have won successive court decisions that increasingly recognized their authority over their traditional territories—not just the small parcels set aside as reserves. Most of B.C. is unceded territory that has never been surrendered by First Nations in treaties.

This June, the Supreme Court of Canada handed B.C. First Nations a landmark victory when it decided, in Tsilhqot’in Nation v. British Columbia, that aboriginal title over territory the group has traditionally controlled must be recognized. The Tsilhqot’in had been contesting a logging licence the province issued to Carrier Lumber Ltd. in 1983, on land near Williams Lake the Tsilhqot’in claimed as its own. Three decades later, and after an epic 339-day trial, the Supreme Court declared the First Nation had the “right to use and control the land and to reap the benefits flowing from it.”

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The decision has not re-written the laws that govern land rights in the province. The Tsilhqot’in First Nation may have earned recognition of their title rights over a 1,750-square-kilometre section of their traditional territory, but that’s one plot of land claimed by one of B.C.’s 198 First Nations. Still, Tsilhqot’in Nation v. British Columbia sets a powerful precedent for aboriginal groups trying to wield more influence in future land-use decisions. Industry and the B.C. government now face a stark choice: negotiate with First Nations to find common ground on resource projects or endure years of costly litigation that will likely end with similar results as Tsilhqot’in. The nightmare version of B.C.’s gas dream would see every wellhead and every stretch of every pipeline challenged for decades in the courts.

Less than two weeks after Martin Louie’s lakeside ceremony, the chief and leaders from the rest of B.C.’s First Nations gather for an unprecedented meeting at the Fairmont Hotel Vancouver. Premier Christy Clark, her cabinet and the government’s top deputy ministers have all come here to promise a new relationship with B.C.’s aboriginal communities. It is the first time the government’s entire senior leadership has sat down with all of the province’s First Nations. The government’s lawyers had, up until just a few months prior, fought the Tsilhqot’in in Canada’s top court, but today, in the hotel’s grand ballroom, Clark promises a different course.

“That decision set out a fork in the road and as leaders we have a decision to make,” says the premier as the crowd nibbles on muffins and steel-cut oatmeal. “We can decide to ignore it, encourage more litigation, put economic development and all of our futures in peril, or we can take it. We can take that fork in the road and begin a journey down a new road.”

Clark proclaims the decision a victory for all British Columbians, not just First Nations or the Tsilhqot’in. “All of British Columbia can benefit from this new opportunity,” she says, thanking Tsilhqot’in leaders for pursuing the case for so long.

Her talk is welcomed by polite applause but does little to placate First Nations leaders who had pushed for the government to apply the principles of the Tsilhqot’in decision province-wide. “All we heard was public platitudes,” says Grand Chief Stewart Phillip of the Union of British Columbia Indian Chiefs afterwards. “It’s going to take more than public platitudes to achieve economic certainty in the province of British Columbia.

“I believe we are going to have to wallpaper this province with lawsuits before the government will wake up to this new reality that is represented by the Supreme Court decision,” he continues. “I believe we’re looking towards a very litigious future. There will be more lawsuits. The province and Canada will continue to lose.”

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But what if Clark and her government decide to walk the walk, reconcile with B.C.’s First Nations and affirm aboriginal title rights throughout the province? What does aboriginal title mean for the province’s natural gas ambitions and for other parts of the resource sector? There’s a legal side of the answer and a practical one.

First of all, it’s important to recognize that while title is a powerful property right, it does not strip government of its powers. The courts have ruled that government and industry must consult with and grant accommodation to titleholders when developing resources—but that doesn’t necessarily mean getting consent.

“There is a power of expropriation in Canada,” says Gordon Christie, an aboriginal law professor at UBC’s law school. “It’s used all the time for non-aboriginal people and their property interests. People lose their land to airports and who knows what else. But the fact is that if communities could get title shown, then they would have a very powerful legal tool to use to try and stop the pipeline from passing through their territory.”

Title can be very difficult, costly and time-consuming to have recognized. A First Nation must show evidence of how it has historically used lands being claimed, in court proceedings that could stretch all the way to Canada’s top court. “You can assert title, but asserting title is not the same thing as having title,” says Christie.

Much of the Tsilhqot’in case was consumed by witnesses trying to prove that Tsilhqot’in people had long occupied the land in question. “There were 29 Tsilhqot’in witnesses, mostly elders,” says Grand Chief Edward John of the First Nations Summit, an umbrella group representing 60 First Nations involved in land title claims. “Chief Roger William alone was on the witness stand for 46 days. Six hundred and four exhibits containing hundreds of thousands of pages of documents were submitted.”

Potentially, each individual First Nation along each pipeline’s route could be forced to prove its title claims in the same manner—in court appeal after court appeal. In the Tsilhqot’in ruling, however, Chief Justice Beverley McLachlin laid out a speedier path forward: “Governments and individuals proposing to use or exploit land, whether before or after a declaration of Aboriginal title, can avoid a charge of infringement or failure to adequately consult by obtaining the consent of the interested Aboriginal group,” she wrote in her decision. In short: consult first, assume title exists and skip the legal battles.

So what needs to be done on a practical front to earn that consent? While the jobs and cash expected from energy development could ease the high levels of poverty experienced by many B.C. First Nations, money is not the first priority, according to Chief John. “Our biggest concerns, right across First Nations territories, is about protecting the environment and the land that provides food for our people,” he says. The health of the environment is a real life-or-death issue for First Nations people in a way that city dwellers don’t experience. “Fish, hunting, resources, medicines, plants—these are things that our people have depended on throughout our history.”

For all the confrontational talk over pipeline projects in B.C., many First Nations groups have lined up in support of B.C.’s nascent liquefied natural gas industry and are doing what they can to push those projects forward. Former Ontario Premier and federal Liberal MP Bob Rae is now the chair for FN (PTP) Group Limited Partnership, or FNLP—a limited partnership of 15 First Nations along the proposed 480-kilometre-long Pacific Trail Pipeline route between Summit Lake (north of Prince George) and Kitimat. The $4.5-billion project, called Kitimat LNG, has some of its environmental permits in place, and with First Nations on board, it’s positioned to be one of the first Canadian LNG exporters out of the gate.

“I am doing a lot of work with First Nations groups around the country, and this struck me as having a lot of potential in terms of the economic benefits that will flow to First Nations,” Rae says. The project has a National Energy Board permit to export as much as 10 million tonnes of natural gas per year, with the pipeline construction employing an estimated 4,500 people. The Kitimat terminal will be built on land leased under an agreement with the Haisla First Nation.

FNLP secured guaranteed payments from Kitimat LNG to be paid on a regular basis to the partnership’s member First Nations throughout the life of the pipeline. “Obviously those payments will depend on a final investment decision being made by the company,” says Rae. “But already there have been substantial payments made to First Nations communities, and there will be more even before the final investment decision. The total value of those financial payments is well over $200 million dollars, which is the largest amount that has been generated by a project of this kind.” Rae notes that other benefits of the partnership include jobs and a number of procurement possibilities for member First Nations.

Rae and the aboriginal leaders he represents do worry that their demands could drive the price of gas shipped from the B.C. coast to unviable levels. “The reality is that B.C.’s projects have to be competitive on a world basis,” he says. “They have to be able to compete on price, on reliability and predictability on when the project can be completed, with projects around the world.” But Rae adds that First Nations won’t temper their demands for environmental safety, no matter if it costs them the economic benefits of a pipeline project. “Our group would not want to see the environment being compromised. In fact we’re building in additional protection and giving a stronger role to environmental stewardship for the First Nations. I think that’s very doable, and I think it’s essential. It’s certainly essential to build the confidence and the good will of the First Nations.” Ultimately, the veteran politician believes that any effort to make B.C. or Alberta gas more competitive will require financial concessions from all partners—government, industry and First Nations.

Chief Louie’s Nadleh Whut’en First Nation is one of the partners in the FNLP—a small band that could use the financial boost. The hills surrounding the Nadleh Whut’en reserve are today covered in a patchwork of spruce and stubble. Forestry companies have spent more than a century taking lumber from land the band once controlled; giant stacks of timber pile up just a few hundred metres from the band’s ceremony site, awaiting shipment to distant markets. For Chief Louie, the promise of the new gas industry is not measured in dollars or jobs. “There is just a little labour here and there,” he says of the pipeline’s construction. “There is nothing for us.” Instead, the potential windfall for industry and the province has given his band leverage to take control over its territory and fate.

“Everyone has their own laws about how to protect their land,” says Louie, his voice hardening with the exasperation brought on by decades of negotiations and legal battles. “Those laws can work within provincial structure. I am not against development; I am not against anything. It’s how it’s done. In my laws, you keep something for the kids after you’re gone. We can’t do that unless our laws are recognized within Canada.”