Wednesday, July 23, 2014
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Barbara Yaffe: Mineral exploration companies seek tax credit for First Nations consultations

By Barbara Yaffe, Vancouver Sun columnist

In a new twist on an old problem, mineral exploration companies are asking B.C.’s government to compensate them for consulting with aboriginals before they start drilling and trenching.

“There is a huge cost to consulting with First Nations,” says Gavin Dirom, CEO of B.C.’s Association for Mineral Exploration.

Dirom estimates a tax credit compensating his industry for “aboriginal engagement” would cost taxpayers $10 million to $30 million a year.

He reports provincial officials “seem receptive” to the request, but it did not make it into last week’s provincial budget.

A fairer estimate of costs involved could only be made in considering all the other groups — lumber interests, oil companies, energy firms — that surely would want to jump on this bandwagon.

Whatever the expense, a tax credit could prove a useful investment, saving taxpayers money in the longer run — by ensuring aboriginal groups are brought onside early in a project’s development.

That would help avoid costly and time-consuming court battles that inevitably flow from aboriginals feeling their treaty rights have been disrespected.

Certainly the task of consultation often is being botched by governments, the parties with the legal duty to consult.

I wrote of a December court decision ordering B.C. to fork over $2 million to a logging company in northeastern B.C. because bureaucrats neglected to adequately consult aboriginals who trapped in the area. They also neglected to warn the logging company before it began work about the aboriginals’ intention to blockade any harvesting attempt.

In a recent news release, the Union of B.C. Indian Chiefs, the B.C. Assembly of First Nations and the First Nations Summit, together cited “countless examples where Canada has refused to enter into meaningful negotiations with First Nations to implement rights that are affirmed by federal and provincial courts.”

Dirom suggests it may be “more productive for the industry to start that relationship (with first nations) early.”

Corporate interests, driven by a profit motive and often having shareholders to satisfy, could do a better job of approaching aboriginal groups and sensitively carrying out mutual-interest consultations.

This won’t be the case with every corporate interest: witness the clumsy way Enbridge has engaged aboriginal communities to be affected by its Northern Gateway pipeline project.

But a tax credit could help smaller companies put in the time and effort apparently required for more positive outcomes.

Dirom says “engagement” can account for as much as 20 per cent of a company’s exploration budget.

His association, in its Winter 2013 Mineral Exploration publication, reveals it soon will release an Aboriginal Engagement Guidebook, “to provide principled guidance and practical advice to mineral explorers in B.C.”

The publication notes, “Mineral exploration today requires achieving a social licence to operate among the first nations on whose traditional territories they are exploring.

“The key to engagement is to get in early and start a conversation.”

The publication advises explorers to build relationships with the chief and council, band office staff, elders and youth. “Spend time with all of them and find out who the influential people and decision makers are.”

Dirom points to the example of geologist Robert Quartermain, CEO of Pretium Resources Inc., exploring the Brucejack gold project in northern B.C.

Quartermain is learning greetings and other phrases in Gitxsan, Gitanyow, Nisga’a and Skii km Lax Ha, to better communicate with First Nations in the area.

Such personalized engagement could help define the “duty to consult” requirement that has become so integral to resource development in B.C.

With a tax credit in place, energetic engagement certainly becomes more affordable.

Whatever Trevor

Dis is Trevor.

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