2022 A.D.E. SINCE TIME BEGAN : Caveat - Forward Thinking Statement - Caveat : IN TRUTH WE TRUST A.D.E. 2022
ADDENDUM
Cobblestone
driveways, stainless steel appliances and spacious decks are standard features
of the roomy homes. One street over, painting crews are finishing the interiors
of another set of new houses as heavy-duty vehicles pack dirt at the next
building site. The goal is to get Fort McKay First Nation residents out of the
hamlet's old trailers and houses and into 100 new homes in the next four years.
"People come to McKay, and they say it doesn't even look
like a reserve," boasts Fort McKay Councillor Gerald Gladue.
The burgeoning prosperity in Fort McKay is a direct result of
the community's embrace of the nearby oil sands industry. A host of First
Nations-owned businesses that work with energy companies create over
$100-million of annual revenue for the 700-person community located 65
kilometres north of Fort McMurray. Unemployment is negligible.
Now the
Fort McKay First Nation has drawn a line in the oil sands. The band is taking
legal action to block development of a key part of the proposed Dover oil sands
project adjacent to an expanse of reserve land called Moose Lake used for
hunting and trapping. The land is sacred territory, Chief Boucher says, part of
the band's last areas not hemmed in by oil sands developments.
Taking its fight to the Alberta Court of Appeal, the Fort McKay
First Nation wants to create a 20-kilometre buffer zone on property leased by
the Dover project, controlled by global energy giant PetroChina Co. Ltd.,
and approved for development by Alberta's energy regulator.
A
ruling in Fort McKay's favour could block development of a rich segment of
Dover's bitumen reserves. And it could force the province's energy regulator to
consider how oil sands projects affect constitutionally protected First
Nations' rights to hunt and fish in their traditional territories, on and off
reserve land – and tip the scales in favour of First Nations when it comes to
Canadian land-use disputes in Alberta and beyond.
For
the energy industry, the widely watched case is pivotal. The legal proceedings
initiated by Fort McKay threaten to spill out into the wider world of energy
development, and serve as a risk to the oil industry's growth plans for years
to come.
Energy
companies have invested hundreds of billions of dollars to unlock the 168
billion barrels of reserves in Alberta's oil sands, and are increasingly
pushing into vast stretches of frontier territory to do it. Such new projects
are essential for the industry to meet its ambitious objective of doubling
daily oil sands production to more than four million barrels of crude a day
over the next 10 years.
And
that rising output is key for the Canadian economy, which relies on a vibrant
western energy industry to create jobs and wealth as the country strives to be
a fast-growing energy power.
To
many, Fort McKay's opposition is a wake-up call to the oil and gas industry, as
well as federal and provincial governments, that First Nations' concerns must
be resolved for the industry to progress.
"If
we can't work things out with Fort McKay, it's going to be much more difficult
to find accommodation with the next batters up. And there's a long list of those
First Nations," said Bill Gallagher, a lawyer who examines conflicts
between First Nations and energy developers.
In
Alberta, the list includes Beaver Lake Cree First Nation, which is arguing a
Court of Appeal case that the cumulative effects of hundreds of oil sands and
other industrial projects have eroded its ability to hunt, fish and trap. The
Athabasca Chipewyan First Nation, which has taken legal action against both
companies and governments in the past, says a ruling in favour of Fort McKay
would help potential legal challenges of Shell's expansion plans at its
Jackpine mine project, or oil sands projects north of the Firebag River. It
describes the lands there as "cultural protection areas" – including
Teck Resources Ltd.'s proposed Frontier project and Shell's Pierre River
project.
"If
Fort McKay can set precedents for what's necessary to preserve their cultural
rights, it strengthens our arguments," said Eriel Deranger, a spokeswoman
for the Athabasca Chipewyan.
A
number of other companies, including Sunshine Oilsands Ltd. and its large-scale
West Ells development near the Moose Lake reserve, could also be affected by a
buffer zone.
Surrounded
by industry
On
a riverfront street in the hamlet of Fort McKay, band member Lee Wilson says
the rest of Canada should be watching to see what will result from the First
Nation's legal challenge. He believes the result will set a precedent for cases
having to do with industry encroachment on treaty lands.
But
for him, the case is personal. He says he needs the peace and quiet of Moose
Lake – officially called the Namur Lake reserve lands – where there's a
smattering of cabins, clean water, plentiful fish, and a high-quality moose and
caribou habitat.
"The
reason why we go up there is basically to get away from the situation here in
Fort McKay, because there is really no place else to go."
The
hamlet of Fort McKay has Suncor and Syncrude mines directly to the south. The
Shell-controlled Muskeg River and Jackpine mines are to the east. Canadian
Natural Resource Ltd.'s Horizon project is north. And to the west, Total SA's
Joslyn North Mine is under construction.
Looking
out the front window of his bungalow, Mr. Wilson can see the night sky glowing
from the lights of the oil sands operations, many within a 20-kilometre radius.
During bird migration periods in the late fall and early spring, the cannons
that are used to scare the fowl away from tailings ponds are heard on a regular
basis.
"The
cannons sound like gunshots going off every two minutes ... Boom, boom, boom.
All day, all night," Mr. Wilson, 41, says sitting in his kitchen.
"If
you drive around at night, it's like a whole bunch of little cities all over
the place."
At
the same time, Mr. Wilson is a busy partner in a trucking and fluid hauling
company that services the oil sands industry. He says he understands the
economic importance of the oil sands.
"It
not only feeds our economic prosperity and growth, but it feeds the rest of
Canada," he says.
But
Mr. Wilson is disheartened that oil sands mines have eaten up his community's
best hunting and trapping grounds. When he wants to escape to the wilderness,
he says it's difficult to get through oil sands security checkpoints and gates.
The
father of five is also concerned about the health of Fort McKay members, living
so close to oil sands mines, and playfully dares you to drink the tap water
given that many houses in the hamlet are stocked with bottled water.
That
is why Moose Lake is so important to band members. In October, the Alberta
Court of Appeal surprised many industry watchers when it gave Fort McKay the
nod to appeal the Alberta Energy Regulator's (AER) decision to approve the
Dover project.
Economic
benefits
Fort
McKay says it's not against the project as a whole, but wants the buffer zone
to include what is now the proposed northern section of the Dover project,
which is being developed by Brion Energy, a joint venture between PetroChina
and Athabasca Oil Corp.
Brion
Energy and the Alberta Energy Regulator say that's the location of the
highest-quality bitumen reservoirs. The company said more than one-third of the
predicted 4.1 billion barrels of bitumen to be produced over the Dover
project's 65-year lifespan will come from the northern part of the project
area.
Like
most firms breaking ground on new oil sands operations today, Brion Energy will
use steam-assisted gravity drainage (SAGD) technology, which sees bitumen
extracted through steam injection and oil recovery at well sites, and doesn't
require the land to be dug up and disturbed the same way oil sands mining does.
Brion has also committed to a number of environmental measures, including
minimizing light pollution, and helping to reclaim caribou habitat outside of
its lease zone.
In
its decision report released in August, the Alberta Energy Regulator agreed
that there could be a negative impact on wildlife, and traditional land uses in
the area, but said given that cabins on Moose Lake are more than eight
kilometres away from Dover's industrial activities, community members are
unlikely to hear, smell or see project-related activities. The regulator came
down in favour of the project.
"The
economic benefits are so significant that despite the social and environmental
impacts described by the parties, the positive aspects of the project outweigh
the negative impacts," the energy regulator said in its decision.
Brion
Energy said it's continuing to work to find a resolution that's acceptable to
both parties.
"We
have been in extensive discussions with Fort McKay to more fully understand
their concerns and want to develop a long-term relationship based on mutual
respect," Brion spokeswoman Kristi Baron said in an e-mail.
The
regulatory hearing and legal manoeuvring around the project has hurt the stock
price of Athabasca Oil, which owns 40 per cent of the Dover project. PetroChina
owns 60 per cent of Dover and is expected to take full control through an
option arrangement once the project clears regulatory hurdles.
"The
Alberta Court of Appeal's decision granting the Fort McKay First Nation (FMFN)
the right to challenge the AER on constitutional grounds is significantly
negative for Athabasca and potentially sets a concerning precedent for the
industry, increasing the risk of project approvals or delays in the regulatory
process," wrote RBC Dominion Securities Inc. analyst Mark Friesen when the
court made its decision in October to hear the case.
Conflicted
Many
band members struggle with the fact that over the decades, the people of Fort
McKay have gone from berry picking, hunting and trapping to being boxed in by
oil sands projects – and enjoying great financial rewards while being a part of
the industrial apparatus.
"We
are what we are," Chief Boucher says. "Of course you're going to be
conflicted."
But
the wealth in the community is a significant point of pride, and Fort McKay has
progressed quickly in recent decades.
Former
Chief Dorothy McDonald-Hyde – one of the first women to lead an Alberta reserve
– had the foresight to establish the Fort McKay Group of Companies in 1986. The
100-per-cent First Nation-owned group of companies is now involved in
construction, road maintenance, fuel supply and hauling, industrial parks, and
in conjunction with Syncrude Canada Ltd., operates the Beaver Creek Wood Bison
Ranch, where buffalo have roamed on reclaimed oil sands land for 20 years.
The
First Nation has backed its housing and community-building boom with funds from
the Group of Companies, with revenue Chief Boucher pegs at around $120-million
last year, and joint ventures. The band also receives money from long-term
agreements – up for negotiation every five years – with nearby oil sands
operators for their presence in traditional territory, although those funds
have to be directed toward community facilities. Transfers from the Department
of Aboriginal Affairs now make up less than 4 per cent of the Fort McKay's
total budget, according to reserve officials.
Fort
McKay is now in a similar position to the oil sands companies themselves –
facing a labour shortage. To help with that dilemma, the First Nation has flown
in dozens of construction workers from the Blood tribe – a large, southern
Alberta band with high unemployment – and plans to make similar arrangements
with other aboriginal communities.
The
Fort McKay First Nation already has a close relationship with its Métis
neighbours. Just steps outside the First Nation reserve boundaries sit the Fort
McKay Métis Community office, the centre of the community for 83 Métis members.
The two communities are closely linked with both familial relationships and
finances.
There,
sentiment about Moose Lake is more strident. Métis president Ron Quintal says
Fort McKay has already "given, given, given" to industry.
"Our
traditional territory has been completely wiped off the map," Mr. Quintal
says.
While
Chief Boucher talks of court cases and negotiations, Mr. Quintal says the
community is on edge over Moose Lake.
Oil
sands developers "will never get close to that area. The community is at a
point where they would go Oka," he says, referring to the violent 1990
land dispute between Mohawk people and the town of Oka, Que.
Mr.
Quintal later gave a more detailed explanation regarding his comments in an
e-mail: "If the community exhausts all legal and political options in
trying to protect Moose Lake, the community would be prepared to take a stand,
whether it be peaceful or a standoff. God forbid that anyone get hurt. However
stopping development in this area is so crucial that the community would be
prepared to protect it themselves."
While
speaking vehemently about Moose Lake, Mr. Quintal spends much of his time and
energy focused on the community's oil-related business ventures and following
the First Nations lead in building houses for the Métis community members.
Mr.
Quintal's Métis community is equally ambitious as the First Nation, and has
plans to break ground on a hotel and conference centre within two years, and
eventually build a strip mall.
"What
we're trying to do is make Fort McKay as completely livable as possible,"
Mr. Quintal says.
The
way forward
For
the energy industry, finding resolution with First Nations starts with
engagement.
Canadian
Association of Petroleum Producers president David Collyer, a former Shell
executive, spent a number of years working with Chief Boucher. He said they
didn't always agree, but they always had a good working relationship. The
dispute over Dover is an issue for the industry, he said.
"Any
time that we have differences with somebody like Jim, it's a cause for
concern," he said. "I think he's been a very balanced First Nation
leader with respect to the oil sands industry," Mr. Collyer said.
"What I would encourage is for all the parties concerned to try to find a
constructive way through it."
But,
he noted, business often wants to move quickly with projects, he said, while
"First Nations want to take the time. And we need to understand that
there's a need to take the time to develop the relationship, to build the
trust."
A
report by energy, environmental and First Nations leaders released this week warned
that bitter conflicts across Canada are "leading us towards energy
resource development gridlock." The report said First Nations need to be
consulted well in advance of applications being filed for project approvals,
and discussions should address the total increase of resource development on
traditional lands, not just the effects of a specific project. The report also
endorsed aboriginal demands that they see greater benefits from resource
development, including some form of revenue sharing.
Another
report, by Douglas Eyford and commissioned by Ottawa, said First Nations need
"a real stake in regional economies," and "to foster inclusion,
aboriginal employment and business opportunities must translate into real jobs
and successful businesses."
In
an interview, Alberta Energy Minister Diana McQueen – who served as environment
minister up until Friday, but was moved to the energy portfolio in a cabinet
shuffle – would not comment on whether cabinet will move to approve the Dover
project before the court appeal plays out, but said the government and Fort
McKay have had a good working relationship in the past.
"We
value working with the chief, and trying to find the balance for the multiple
land uses," Ms. McQueen says. "First and foremost is to find out from
the chief what are his concerns, and then to see if there's an opportunity for
solutions."
But
there's little sign Fort McKay is going to compromise when it comes to
protecting Moose Lake. While the past two decades have seen the community embrace
the business opportunities that come with living in the midst of one of the
world's largest oil-producing regions, they maintain they didn't choose the oil
sands, the oil sands chose them.
Earlier
this year, Mr. Gladue, a hunter and band councillor, spoke about Moose Lake
being Fort McKay's last wild retreat at a hearing on the project in Fort
McMurray. He asked the Alberta Energy Regulator's three panel members to
carefully consider the band's request for the buffer zone.
"They have chopped off our arms and our
legs. Now they are going for our heart."
Follow Kelly
Cryderman on Twitter: @KellyCryderman
