Calgary analyst says Supreme Court decision clarifies who can oppose projects
By Dan Healing, Calgary Herald
CALGARY — A Supreme Court decision on B.C. native land titles creates new risks for a resource sector already struggling to deal with aboriginal opposition, industry observers said Thursday.
The most positive aspect of the ruling — which gives bands with unresolved land claims the right to legal title to traditional lands regularly used for hunting, fishing and other activities — is that it offers clarity on what has been a murky issue, they added.
Alex Ferguson, vice-president of policy and direction for the Canadian Association of Petroleum Producers, said the group which represents oil and gas companies is still digesting the 80-page decision.
“Our view is, at the surface, it’s a good piece of clarity to add to the long-standing evolution of these issues,” he said, noting there may be “rub points” that emerge as the ruling is interpreted.
He said it’s difficult to say how the decision and its “strength-of-claim” implications will affect the $6.5-billion Northern Gateway pipeline proposed by Enbridge Inc. (given federal approval last week) or the proposed $5.4-billion expansion of Kinder Morgan’s Trans Mountain pipeline.
Both are designed to carry oil from Alberta to the West Coast and both face fierce opposition from native groups as well as federal opposition parties and provincial politicians.
In a research report Thursday, analyst Steven Paget of FirstEnergy Capital said the ruling means more native communities will be able to claim standing to oppose pipelines but at least the proponents will know which groups they must negotiate with.
“We believe this decision has both positive and negative implications for pipeline projects,” he wrote, noting it appears to give standing to almost all First Nations with claims to territories in northern B.C., where there are few or no treaties.
He pointed out that the ruling doesn’t greatly help or hinder the pipelines because many First Nations that oppose the projects, especially on the coast, can claim long-term continuous settlement and therefore would have been granted standing anyway in a legal challenge.
In the Supreme Court decision released Thursday, Chief Justice Beverley McLachlin wrote that aboriginal title is not absolute and development can go ahead if there is either the consent of the First Nation or if the government can prove need and attends to its fiduciary responsibility to the aboriginal group.
Members of the Xeni Gwet’in and Tsilhqot’in First Nations appealed to the Supreme Court after the B.C. Court of Appeal issued a ruling that restricted its aboriginal title to sites where the band has had an “intensive presence.”
The Supreme Court said aboriginal title “is not confined to specific sites of settlement but extends to tracts of land that were regularly used for hunting, fishing or otherwise exploiting resources and over which the group exercised effective control at the time of assertion of European sovereignty.”
Sharon Mascher, a law professor at the University of Calgary, said the ruling has enormous implications not only for future projects but also for ones that have already been approved or started construction.
She pointed to a paragraph in the decision that says if a band acquires title to land on which development has already been approved, “it may be necessary for the Crown to reassess prior conduct in light of the new reality in order to faithfully discharge its fiduciary duty to the title-holding group.”
The government might have to retroactively cancel permission for a project if it was approved without consent prior to aboriginal title being established, the paragraph adds. Furthermore, legislation enacted before title is established may also be “rendered inapplicable” if it infringes on aboriginal title.
“That means that everybody needs to think very, very carefully about what they’re doing, not just post approval of title but also in light of prior conduct leading up to an assessment of title,” said Mascher.
CAPP’s Ferguson agreed the paragraph is troubling.
“Of course. And at risk will be those projects that weren’t properly consultative, it’s quite clear in the decision on that, too ...,” he said.
“That hasn’t changed. If you’ve gone out and done a project where you just frankly have not followed those processes and governments have not followed and met their obligations, well, those projects would be at risk.”
Aboriginal groups already have a great deal of leverage when negotiating socio-economic agreements with resource companies, Ferguson said when asked if the ruling boosts their ability to negotiate rich benefits in return for supporting projects.
Paget said the Supreme Court’s confirmation of the government’s right to allow resource projects if there is a compelling public interest is important because having coastal access for oil exports clears that hurdle.
“This part of the decision could be an avenue for Gateway or Trans Mountain to proceed, although we expect there would be further court cases where Enbridge or Kinder Morgan would be forced to prove that their pipelines were in the public interest,” he wrote.
He said he will continue to leave the Northern Gateway project out of his calculations for future Enbridge earnings as it faces too many obstacles. The company has not yet officially sanctioned the project.
In a morning news conference to announce forestry project funding in Calgary, Natural Resources Minister Greg Rickford said the federal government is reviewing the ruling.
“We ultimately believe the best way to resolve outstanding aboriginal rights and title claims is through negotiated treaty settlements,” he said.
He refused comment on how the decision might affect the Northern Gateway pipeline.