Indigenous and Northern Affairs Committee on Nov. 17th, 2009

[Stephen Mills]

Without getting into too much detail, 16,000 square miles of land is geared to be settlement land. Of that, 10,000 square miles includes subsurface rights. The other 6,000 square miles is simply on the surface rights.

In the end, if all first nations settled--there are still three outstanding claims--approximately 9% or so of Yukon land would be considered settlement land.

[The Chair, Conservative, Bruce Stanton]

Is that all?

[Stephen Mills]

That's with regard to the issue--that's right, 9% is settlement land--but we have to remember that the agreements themselves provide for traditional territories for which there are harvesting, economic, and many other rights, and they protect the rights of many first nations within their entire traditional territory. So the agreements go well beyond the extent of simply those settlement land blocks. That is probably what Chief Johnston was saying there.

The area in which we have rights for harvesting and traditional use as well as economic benefits and others covers a much broader area than simply our settlement lands themselves.

[The Chair, Conservative, Bruce Stanton]

This has been very helpful. As we're looking at this study on identifying obstacles and barriers to northern economic development, it gives rise to the fact that the government, or any government, would be interested in that, of course, but we have to be interested in it in terms of how it actually improves the lives of people who live here. In other words, it's not just development for the sake of development. It has to in fact have some tangible measure in terms of improvement to opportunities for people.

You have shed some real light on that, and thank you for that.

We are now going to suspend. I'm told, members, that we will suspend until 1 p.m. We'll resume here, so perhaps you could be back here at about 12:50, before we get under way to meet our next panel of witnesses.

Lunch will be available in a room called the office. I understand there is sufficient for all the members and staff.

We will suspend until 1 p.m. Thank you.

[The Chair, Conservative, Bruce Stanton]

Welcome, witnesses and members, back to our continuing meeting. This is meeting number 37—trente-sept—and we are in consideration of barriers and solutions or opportunities for the advancement of northern economic development in Canada's north, specifically the three territories.

We're delighted to be here in Whitehorse today, and we're going all day today, as a matter of fact, through until 9 this evening, with a whole cross-section of representation from different stakeholders on the question of northern development.

I'll introduce witnesses here in a moment, but for the benefit of our guests this afternoon, we will generally start off with a five-minute presentation from each of you. We are waiting still on one representative from Northwestel who is supposed to be joining us, and may do so in the course of our—

[Roger Gaudet, Bloc, Montcalm, QC]

Can you hear?

[The Chair, Conservative, Bruce Stanton]

Maybe the device needs to be changed. We'll work on that.

As I was saying, we'll start with a five-minute presentation from each of the witnesses, after which we will then go into questions from members. Those are also five minutes, including both the question and the responses from the various members, and we go around the table in a sort of preordained fashion.

We have actually, as I said, three organizations and a total of four witnesses today. Today we welcome Ruth Massie, the chair, and Pearl Callaghan, the operations leader for the Alaska Highway Aboriginal Pipeline Coalition. Welcome.

We also welcome Mr. Randy Clarkson. Randy is an engineer with the Klondike Placer Miners' Association.

Then we also welcome Jennifer Byram. Jennifer is the vice-president for Pelly Construction Limited.

And as I said, we will also be welcoming, hopefully, through the course of our session, a representative from Northwestel.

Let's begin with Ruth Massie, here from the Alaska Highway Aboriginal Pipeline Coalition. You have five minutes.

[Chief Ruth Massie, Chair, Alaska Highway Aboriginal Pipeline Coalition]

Thank you, Mr. Chair.

Good afternoon, Mr. Chair and committee members.

My name is Ruth Massie. I'm the chair of the Alaska Highway Aboriginal Pipeline Coalition. I am representing five self-governing first nations along the proposed Alaska pipeline route. I am also a citizen of the Ta'an Kwäch'än council, and I welcome the standing committee members to our traditional territory, which we share with Kwanlin Dün First Nation.

We thank you for the invitation to present to you our experiences with the barriers and challenges of economic development for our organization and our communities within the Yukon.

Since day one of settling our land claims and establishing our own self-government structures, Yukon first nations have experienced many challenges and setbacks in our efforts to meet our obligations within our agreements. It has been a constant struggle to keep up.

Now we are faced with another challenge: the largest proposed project in our history at our doorstep. We recognize the need to prepare ourselves and our communities for a new industry, oil and gas, of which we know little.

Our biggest challenge to date is plain and simple: the lack of human capacity in our communities and the lack of financial resources to support our efforts. The Alaska Highway Aboriginal Pipeline Coalition submitted a multi-year business plan proposal to the Government of Canada over four years ago, asking for support to flow the information and communicate to the first nations communities, and we still haven't heard or received a reply.

The Government of Canada has fully supported the Mackenzie Valley pipeline and has ignored our requests to support us in regard to the Alaska Highway pipeline project. It is our intent to try to avoid the mistakes we have heard about with the Mackenzie Valley pipeline.

We need to be prepared and proactive and we need to participate as key stakeholders with industry, governments, and other first nations with regard to the proposed mega-pipeline project, which requires adequate resources. This project will inevitably impact our lands, water, environment, fish and wildlife, and our people's way of life--forever.

Our operation has received $200,000 annually from the Yukon government, and periodically we receive funds to accommodate our workshops from the Canadian Environmental Assessment Agency.

Our question is, when is the Government of Canada going to consult and accommodate first nations in the Yukon with regard to the proposed Alaska Highway pipeline project?

Our organization is still seeking a face-to-face meeting with the Government of Canada. They have been meeting regularly with the Yukon government and industry officials for some time now. We need to discuss the importance of first nations being proactive now in the preparation of this megaproject.

First nations do not have adequate resources to address all the aspects of this project. What the aboriginal pipeline coalition had asked for was long-term financial support for each community to hire one person as a community liaison officer to focus on this megaproject and communicate with everyone involved on a regular basis.

After all, this project will affect every person's life, and right now there are a lot of fears in the communities. The communities have expectations, which are to capitalize on the opportunities that arise while minimizing the issues and risks involved. Oil and gas is a new industry in our region and we need to educate ourselves about it.

In closing, I thank the standing committee for this opportunity to speak to you and wish you a safe stay and a good trip home.

Thank you.

[The Chair, Conservative, Bruce Stanton]

Thank you very much, Ruth.

I also express our thanks to Pearl.

We'll come back to questions later. I'm sure there will be many.

Let's go now to Jennifer Byram.

Jennifer, you have five minutes for your presentation. Please proceed.

[Jennifer Byram, Vice-President, Pelly Construction Ltd.]

Okay.

Pelly Construction is headquartered in Whitehorse, Yukon. We are an earth-moving business primarily in contract mining and road reconstruction. We currently employ close to 200 workers year-round. Though we're based in Whitehorse, we often work in British Columbia and sometimes in the Northwest Territories and Alaska. One of our most adventurous projects took us to Antarctica to build an airstrip, hangar, fuel storage tanks, and water system for the British Antarctic Survey.

We have grown into a very successful northern business doing approximately $60 million to $85 million of business per year. At the moment, our two main projects are in the Minto mine in Yukon and the Brule mine in British Columbia. We have several first nations agreements in the Yukon or joint ventures with the development corporations here, such as Little Salmon Carmacks First Nation, Na-Cho Nyak Dun, Selkirk First Nation, Vuntut Gwitchin, and Ta'an Kwäch'än in the Yukon. Many of our projects are in these people's territories, and we work within their local first nations representation.

We are very proud of our relationship with the Vuntut Gwitchin Limited Partnership. I believe you heard from Stephen Mills this morning. We own a company, Porcupine Enterprises, that is 51% aboriginally owned. Porcupine operates out of Old Crow and completes earth-moving projects up there, such as river bank stabilization, rock crushing, and hauling gravel from their mountain. The partnership is so successful that we decided to continue this and become partners with the Ta'an development corporation as well, and we're going to develop the waterfront property here with condos and commercial property.

Our location in the Yukon is an obvious barrier for us in trade. All our parts and equipment come up the highway. In the last few years, money for the reconstruction of the Alaska Highway from Public Works has lessened. The route from Alaska to Anchorage is even in worse shape. The permafrost is destroying the highway. Our clients at the copper mine are able to get their product to the market, though, by trucking the ore to Skagway, Alaska, through the South Klondike Highway, and loading it on to ships from the local port. A railroad is always something we talk about. If we could construct railroad tracks to meet up with Fort Nelson, 1,000 kilometres away, that would help. Our experience has shown us it's easier to move to Alaska, which is in a foreign country, than it is to compete in NWT or British Columbia. In NWT the territorial government includes BIP and their determination on who gets government contracts. The BIP, or business incentive policy, applies to local hires and purchasing locally. Even products not available in NWT, not manufactured or even sold there, have to be sourced through a BIP-certified company. It's impossible for us to compete there because our prices start off at 20% higher than those of the local people. We have tried, and we probably will not go back unless they have a trade agreement with the Yukon, because it's too difficult. We've had enough of losing money there.

In B.C. we're fortunate enough to work in coal mines, where our equipment and parts are exempt from PST. However, if we take a project outside the coal mining industry, we would be subject to paying PST on our equipment when we move into the province. Even if it's 20 years old, we would have to pay PST on 50% of the purchase price, and that's a barrier. Another barrier for which I don't think there is a solution here today is that our competitors do not live in the north. They have their headquarters in Vancouver. To lobby potential clients, they just walk across the street and maybe go for a cup of coffee, or perhaps they meet at a hockey game or a social function. We're simply not part of that group.

We would like to see more money spent on the Alaska Highway. There are at least 100 miles that follow the old war trail. When we brought our triple-7 haul trucks up to the mine, we had to cut the haul boxes in half to get them through that portion of the road. We are able to haul those truck boxes in Alberta and British Columbia, but once we hit Muncho Lake, we can't haul them any further because the road's too narrow. We have spent hundreds of thousands of dollars on that. That's one of my solutions.

That's all I have to say today. Thank you.

[The Chair, Conservative, Bruce Stanton]

Thank you very much, Ms. Byram.

Now we'll go to Mr. Clarkson for five minutes.

[Randy Clarkson, Professional Engineer, Klondike Placer Miners' Association]

Good afternoon. I am Randy Clarkson. I'm here on behalf of the Klondike Placer Miners' Association.

Our requests are fairly simple. We're asking this committee to recommend to the Minister of Fisheries and Oceans that she include the KPMA directly in the development and implementation of the fish management system for placer mining. And we're asking you to recommend to Transport Canada that they transfer regulatory authority of the Navigable Waters Protection Act regarding placer mining in the Yukon to local Yukon placer inspectors.

The KPMA represents the 130 family based placer gold mines operating in the Yukon.

Placer mining has been ongoing throughout the Yukon since the 1860s. It has continued unabated through the Great Depression of the 1930s, through the recent recession in 1980, and through the current recession. In 2009, these mines cumulatively produced about 54,000 ounces of gold. That's worth about $50 million. The indirect impact of placer mining to the Yukon economy, including supplies, services, and other spinoffs, is in the order of $150 million. Therefore, placer mining is undoubtedly the most reliable, and one of the largest, sources of privately generated wealth in the Yukon.

Fortunately, in 2009, placer miners were blessed with record high prices for gold, stable fuel prices, and an abundant source of labour, thanks to the current recession. Unfortunately, the placer industry continues to be burdened with a seemingly endless barrage of regulations. In the past few years we have seen the number of permits and regulations increase dramatically. This has delayed the start-up of new mines and has added unnecessary operating and capital costs. We at the KPMA are hopeful that the efforts of this standing committee will help to remove and/or streamline current and future regulations for our industry.

The most recent regulatory hurdle for the industry has been the Navigable Waters Protection Act, which was recently taken over by Transport Canada. Transport Canada does not have sufficient personnel in Canada, and none in the Yukon, to execute these regulations, and they are unfamiliar with the local streams. They have decided unilaterally that a vessel is as small as a kayak, and thus many non-navigable historic placer streams are considered by them to be navigable. Transport Canada expects detailed engineering drawings of all stream-works and crossings. These are not generally available, and they're not required by any other regulatory body. Transport Canada considers some of the stream rehabilitation works required by the Department of Fisheries and Oceans to be impediments to navigation. So we have two departments in conflict. This has led to long delays in permitting works that are essential to modern placer mining.

The solution is fairly simple, we think. It is to transfer regulatory authority for the Navigable Waters Protection Act regarding placer mining in the Yukon territory to local Yukon placer inspectors. They are familiar with the local streams and with placer mining.

We should consider a vessel to be at least the size of a boat you could go fishing in. That would reduce the number of small and intermittent streams considered navigable by Transport Canada. We should use existing screening and water licence applications instead of creating an additional paper trail and drawings, as required by Transport Canada.

The fish habitat management system of the Department of Fisheries and Oceans was drawn up to save a failing industry that was about to die in December 2002. Luckily, we brought it back with this management system. In the early stages, the KPMA was part of the committee. We have been weeded out of it now. We're the ones directly affected, and we would like to be put back on that committee.

In summary, we have just two recommendations. We would like you to recommend to the Minister of Fisheries and Oceans that the KPMA be included directly in the development and implementation of the new fish habitat management system for placer mining. And we would like you to recommend to Transport Canada that it transfer regulatory authority for the Navigable Waters Protection Act regarding placer mining in the Yukon to local Yukon placer inspectors.

We have a whole list of other issues, but I don't believe they're within the federal purview.

I must apologize in advance for my French translation of this English paper. It was done with my computer, and it probably is full of errors.

Thank you very much.

[The Chair, Conservative, Bruce Stanton]

Thank you very much, Mr. Clarkson.

Now we will go to the first round of questions from members. We'll stay with our usual format, if members are okay with that. I think we'll stay with the five-minute round. Is that acceptable? We're doing okay time-wise, but we can get more questions in that way, I believe.

Let's begin with Mr. Bagnell, for five minutes.

Mr. Bagnell.

[Larry Bagnell, Liberal, Yukon, YT]

Thank you.

Thank you all for coming.

For Ruth, just to put into context the effect of a pipeline on the communities, here we have a people, some of whom had their first contact with white people just barely more than a hundred years ago, and now all of a sudden they're facing the biggest project certainly in North America, and perhaps in the history of the world, since the Great Wall of China. And these are communities of a few hundred people.

Tell me how that prospect is affecting them. What are their feelings?

[Chief Ruth Massie]

It hasn't been that long since we 11 first nations settled our land claims, and we are the original inhabitants of the Yukon, before the gold rush. Thinking about this project coming into their communities, they often think of and fear the worst of the project, thinking about the oil spill in Valdez, Alaska, and of course that being an earthquake zone as well.

They have a lot of strangers in their communities, and without a constant contact in the community, a lot of visitors in the communities just go and knock on somebody's door. It's quite frightful, and we've had complaints to our office from elders who open their door to a total stranger and they don't know what to do.

They all watch TV and they see all the frightful things that happen south of 60, and they're very, very worried about all these strange people coming. What's going to happen to their land? What's going to happen to their lifestyle? What's going to happen to their grandchildren in the communities?

They all experienced the Alaska Highway being built, which was a negative impact for many, many of our community members. Once the highway went in, a lot of the kids were taken from the communities and sent to Whitehorse or Dawson City to go to school, never to see their parents for years to come. Some of them didn't go home for six to twelve years, and the parents were never ever informed what happened to their kids, other than they were going to school.

So there are a lot of worries. We have a lot of community members who still live off the land. They trap, they fish, and now they have this project coming through. What's the damage going to be? There are so many questions.

And then they don't know what this industry entails. Their questions a lot of the time are why the government isn't protecting us and why we don't know more about this project, because people are starting to go into the communities, industry people. That was one of the reasons we started the coalition, so we could get information out to the communities.

But we don't have a constant contact in the communities either. And if the government is not helping the communities to prepare, why should it be a priority for them in the communities?

Thank you.

[The Chair, Conservative, Bruce Stanton]

Thank you.

You've still got one minute, Mr. Bagnell.

[Larry Bagnell, Liberal, Yukon, YT]

Okay. I'll ask all my questions, then.

Randy, I have a quick question for you.

One of the reasons you want to be involved—and I think it's a good reason—is that before, when you weren't involved, Fisheries actually made a decision where the limits of effluent would have shut down the entire industry, basically, in the Yukon.

[Randy Clarkson]

That's correct, yes.

[Larry Bagnell, Liberal, Yukon, YT]

Okay, good.

And my other questions are for Jennifer, in my short time.

I don't think people can underestimate that we're looking for success stories, and the fact that your company in this far, remote Yukon could actually win a contract that was open to anyone in the world to build an airport into Antarctica is fantastic. Could you tell us how you did that?

Also, can you just elaborate a bit on the facts of permafrost, what it's doing to our infrastructure and our roads, because it's affecting the north more than elsewhere?

And my understanding on that $5 million railway feasibility study was that there wasn't enough business to make it practical. Could you comment on that study at all?

[Jennifer Byram]

First, the Antarctic project was open to worldwide bidders. There were bidders from Belgium, another Canadian bidder from Montreal, and England. My father, Keith Byram, went down there, and I think he spent a month talking to the people who finally awarded us the contract. Because of our northern experience and our experience of being isolated from service centres, we were able to win that tender.

If anyone watched the news a few years ago...that was instrumental in evacuating that American doctor from the Antarctic. They used Rothera strip, and that was the strip we built.

The permafrost is destroying our highway, especially north of town, but also south. We haven't been able to get a handle on how to prevent it. They've spent millions of dollars reconstructing the highway, and ten years later it's hard to drive on because the frost heaves are so bad. I remember when we were out there building the highway, it would be frozen and you'd almost want to blast it. We'd rip it with the dozers, and then all of a sudden, when the sun came out, it was a mud puddle, it was soup, and it would fall off the trucks. So within a few hours it goes from a frozen state to soup, and it was very hard to handle. Once you start to thaw that stuff, it's really hard to maintain. We tried putting geotechnical fabric down. There was a study done to put those frost tunnels in, but nothing seems to be working.

The study you're talking about, is that the study north of town?

[Larry Bagnell, Liberal, Yukon, YT]

The one that Alaska and the Yukon government did on the railroad.

[Jennifer Byram]

I'm not familiar with that study.

[The Chair, Conservative, Bruce Stanton]

Thank you.

Thank you very much, Ms. Byram and Mr. Bagnell.

Now we'll go to Monsieur Lévesque, pour cinq minutes.

[Yvon Lévesque, Bloc, Abitibi—Baie-James—Nunavik—Eeyou, QC]

Thank you, Mr. Chair.

Ladies, it is rare for the men to be outnumbered here.

Ms. Massie, in terms of land claims, from what I understood from this morning's first nations witnesses, almost all the communities are autonomous and can exercise self-government.

During your presentation, you talked about the difficulties you have had in making yourselves heard. Beyond that, it is mainly a matter of the knowledge you have in order to negotiate with the companies that are going to set up on your land.

Even before these companies start setting up shop, are they required to talk to you and find out what your needs are or what your vision is for your own development?

[Chief Ruth Massie]

Thank you.

For the industry players who do come into the community...as a self-governing first nation, you have jurisdiction in your settlement land areas. We do have law-making powers, although when it comes to economic development or industry we would prefer to be in a partnership, to gain not only the partnership but to learn from their expertise, and also for us to teach them a little bit about us as well.

Yes, they do have an obligation according to our agreements, and Canada has a fiduciary obligation to ensure the protection of the settlement lands in our communities. It isn't as if we don't want them in our communities, because we do want to be able to participate in this industry, but we need to educate ourselves about it first. Yes, they do have an obligation to tell us what they're doing in our traditional territories.

Thank you.