Indigenous and Northern Affairs Committee on March 3rd, 2009

[Chief George Stanley, Chief of the Frog Lake First Nation, Indian Resource Council]

Let me turn it over to—excuse me, Mr. Chair, I have a bad cold—my CEO to answer that, if you don't mind. Mr. Joe Dion.

[Joe Dion, President of the Frog Lake Energy Resources Corporation, Indian Resource Council]

Thank you.

The ability of the government and the first nations to cancel leases or contracts with companies if they're not practising the proper requirements or expectations of first nations I think is a good one. At the same time, the nations have to be careful that they don't abuse this kind of authority that will be vested in a minister. I guess by virtue of having a minister, the minister would of course consult with first nations first before he would cancel such contracts or leases.

It's a good tool to have, but I think one has to be very careful that it's not abused, because if it's abused by the first nations or by the minister, you could scare off investment in our communities.

[Larry Bagnell, Liberal, Yukon, YT]

Or end up in court.

So you're not opposed to the amendment that would give the first nations that power?

[Joe Dion]

Not at all.

[Larry Bagnell, Liberal, Yukon, YT]

Interesting; the government is opposed to that.

As a second point, it's been suggested to us by one first nation that it doesn't give first nations the ability or the power to develop oil and gas on their lands. I'm just wondering what your response is to that critique.

[Joe Dion]

This legislation does not what?

[Larry Bagnell, Liberal, Yukon, YT]

It doesn't give a first nation the power to develop oil and gas themselves, on their own lands.

[Joe Dion]

Actually, it does.

I think a great example of that situation right now is Frog Lake. At Frog Lake First Nation we issue the lease to its own company, in this case Frog Lake Energy Resources; I'm the president of the company. We in turn farm out these leases to partners, in this case CNRL and Buffalo Resources Corporation.

So we do have the ability to do our own development on our lands through this legislation.

[Larry Bagnell, Liberal, Yukon, YT]

Perhaps I could ask Mr. Crowfoot why the government is opposed to the amendment that the council here is in favour of.

[Strater Crowfoot]

I want to start off by saying, as Joe Dion has expressed, that if the lease is cancelled, it may scare off investment. Cancelling a lease is a very serious matter. Currently, I would point out, it's the case that both we and the chiefs and councils agreed to the terms of the lease when we issued it.

If a company doesn't comply with those terms, then we will cancel. That can happen right now. But I think allowing the first nation the sole authority to cancel it just by themselves could cause the lands to become perhaps sterile. Investment could be scared away.

So for these investments that are put into first nations lands, I think it's important that when we draw up the leases, we put the terms and conditions in the lease. If they're complied with, then the company should be able to carry on their business.

But we will be involved, as I said. We can do it right now. If those terms and conditions aren't being met, then we will cancel.

[Larry Bagnell, Liberal, Yukon, YT]

I don't think that's giving very good reflection on, or giving respect to, first nations governments. You're saying that provincial governments, or Indian Affairs, are more reliable governments, are less likely to arbitrarily cancel a lease.

I mean, they're government; if they cancel a lease illegally, they'll be in court just like Indian Affairs would be, or just like a provincial government would be. We've developed government-to-government-to-government relations with first nations. They're government. Why would it scare someone away any more than if it were Indian Affairs cancelling the lease, or Alberta cancelling the lease?

[Joe Dion]

Can I respond to that question? That was a little curveball. I thought that was....

Anyway, just to clarify, I don't think the first nation should have the ability to cancel leases at this point simply because of this: there's a huge responsibility by the government to carry on as a trustee. If first nations do want to take over management of their lands outside this legislation, they probably can do that. But at this point in time, I think it would be best if these lands were held in trust by the federal government.

[Strater Crowfoot]

Mr. Chairman, the point here is that we jointly manage these lands today, together with chiefs and councils. It's a two-key process. For us to cancel, we both have to agree.

[Larry Bagnell, Liberal, Yukon, YT]

Got it; thank you.

[The Chair, Conservative, Bruce Stanton]

Okay? The point's made?

Mr. Russell.

[Todd Russell, Liberal, Labrador, NL]

Thank you, Mr. Chair.

Very quickly, there seems to be a premise here with this whole legislation that a hell of a lot of first nations cannot manage or assume control of their own lands, that we have to invest more authority with the minister, more clarity with the minister, in order to do this. I don't like that sort of underpinning the legislation.

I have a specific question here. It says in the IRC handout that “inconsistency” between federal and provincial laws and regulations impedes potential economic development activities on first nations lands.

What are those inconsistencies between federal and provincial regulations that we're talking about? The inconsistencies I hear talked about involve mainly whether there's a provincial regime off reserve and a different regime on reserve.

So what are those inconsistencies that we're talking about?

[The Chair, Conservative, Bruce Stanton]

You only have time for a brief response, and then we'll have to go to the next questioner.

[Strater Crowfoot]

Looking for inconsistencies in regulation?

[Todd Russell, Liberal, Labrador, NL]

The statement was made that there is inconsistency between federal and provincial laws and regulations that impede potential economic development. So what are those inconsistencies?

[Strater Crowfoot]

One would be the limitation period we're dealing with. Alberta has moved to a two-year limitation period, and we're looking for us having up to a 10-year limitation period to ensure we have adequate time to do our audits and verify the royalties. So that's one inconsistency we're trying to address.

[The Chair, Conservative, Bruce Stanton]

Thank you very much.

Mr. Lemay, you have the floor for seven minutes.

[Marc Lemay, Bloc, Abitibi—Témiscamingue, QC]

I would like to know what strategies have been implemented to assist First Nations in getting organized so they can develop their resources. One would say that the First Nations, at least some of them, aren't ready for the manna to fall, if I may use that expression. It takes a lot of money to exploit oil and gas on aboriginal land. Can you explain to us how things work, in the context of day-to-day operations, if you discover gas resources on land? That means that you've gone there previously and, consequently, that you've entered into agreements. What do you do to properly prepare a First Nation that is dealing with an oil or gas boom on its land?

[Roy Fox]

Mr. Chair, in trying to answer the question, I think we would have to look at some of the history with respect to the involvement of first nations in the development of their oil and natural gas resources.

One of the ways we've tried to prepare first nations people to be able to deal with their resources in a constructive way, either in their management or on the business side, is to set up the pilot initiative. The pilot initiative then led to the development of legislation, which we call FNOGMMA. When we were preparing for that initiative, we ensured people from each of the five tribes were put on a one-year training course at the Southern Alberta Institute of Technology, as well as work with some of the experts at Indian Oil and Gas Canada. So we tried that initiative. Three of those tribes have remained with their program and have developed the capacity to manage their resources.

As part of the continuous change process, we've tried to ensure that in the future, should more of our tribes feel they could possibly take advantage of opportunities, we would have expertise ready for them to use. At the same time, we would then try to set up capacity training programs for their benefit. We did a needs analysis as part of the initial work of the business centres. That needs analysis indicated our people definitely needed help trying to take advantage of business opportunities, but they also needed help in the direct management of their resources. These are some of the ways we've tried.

[Marc Lemay, Bloc, Abitibi—Témiscamingue, QC]

Are there any First Nations, communities, that do not cooperate with the Indian Resource Council and that say they want to develop their resources themselves? If so, what do they do?

[Roy Fox]

Mr. Chair, we've tried to encourage those first nations who have oil and natural gas resources to become members of our organization. However, that is their prerogative. We've found that all of the oil and gas producing tribes are members of the Indian Resource Council, as well as those tribes that have the potential to be, who may have reserves of oil or natural gas within their lands.

Our responsibility goes beyond the reservation to reserve boundaries. We also assist some of our people with respect to oil and gas development on their traditional lands.

So it is entirely the prerogative of first nations and their own specific governments if they want to participate in the work of the Indian Resource Council.