Evidence of meeting #29 for Natural Resources in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was federal.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Bob Rae  Partner, Olthuis Kleer Townsend
Stephen Van Dine  Assistant Deputy Minister, Northern Affairs Organization, Department of Indian Affairs and Northern Development
Sheilagh Murphy  Assistant Deputy Minister, Lands and Economic Development, Department of Indian Affairs and Northern Development
Sean Willy  Vice-President, Des Nedhe Development
Frank Smeenk  President and Chief Executive Officer, KWG Resources Inc.
Ryan McEachern  Managing Director, Canadian Association of Mining Equipment and Services for Export

9:25 a.m.

NDP

Richard Cannings NDP South Okanagan—West Kootenay, BC

I want to switch to capacity and education. We hear of the close connection between first nation groups and mining developments and job availability. I'm just wondering if perhaps all three of you could comment on the role of the federal government in promoting increasing funding for education in first nations, right from elementary school up to post-secondary, and how that could enhance all of this connection and co-operation.

9:25 a.m.

Partner, Olthuis Kleer Townsend

Bob Rae

Again, it's a big topic, but briefly put, we know that Mr. Harper and the national chief signed an agreement on education that didn't carry. Now we have to go back and figure out what new agreement on education we can get to.

I think, frankly, it would also involve the provinces, because there's so much of a connection in the jurisdictional issue for education at the provincial level that they have to be involved. I don't think the first nations are opposed to that. In fact I think it's one of the approaches they would look at now very carefully.

Lots of exciting things are happening in higher education, not just in primary but also in post-secondary. We have more people enrolled now in community colleges and aboriginal institutes. We have nine aboriginal institutes in the province of Ontario, which are about to get formal recognition from the province, and there are a lot of very exciting developments. Again, the federal government needs to be involved, because this thing is moving on the ground very quickly.

9:25 a.m.

Assistant Deputy Minister, Lands and Economic Development, Department of Indian Affairs and Northern Development

Sheilagh Murphy

There's certainly, along with our department, which has funding for economic development to look at opportunities for communities to take advantage of development, also Employment and Social Development Canada. They have their ASETS program and their strategic partnership fund, which is focused on looking at where the emerging labour market is going and how indigenous communities and individuals can prepare for that. There has been a lot of work strategically to look at mining and mining opportunities in areas like the Ring of Fire, northern Quebec, and elsewhere to better equip individuals to have the skill sets so that when those mines come on stream, they are ready for that.

We do work more with the communities rather than necessarily the provincial government. Sometimes it's the provincial government, as well, trying to figure out how to bring all the resources to bear. We are strategically looking at where the emerging opportunities are and trying to gear individuals to take up training that will land them a job in that sector. It won't necessarily be right in their home community. Mobility may be part of the solution. Certainly we are much more targeted in the way we approach that than we would have been maybe 10 years ago. Through the strategic partnerships initiative, we get all 15 federal departments together, look at those opportunities, and figure out who can do what around regional development. For the Labrador Trough, the Ring of Fire, and in and around major pipeline projects we are looking across departments to see where the opportunities are and working with communities to package up projects focused on skills training and development, community preparedness, engagement, etc., so that they are better prepared.

9:30 a.m.

Liberal

The Chair Liberal James Maloney

Thank you, Mr. Cannings.

Mr. Serré, go ahead.

October 27th, 2016 / 9:30 a.m.

Liberal

Marc Serré Liberal Nickel Belt, ON

Thank you, Mr. Chair.

Thank you to the three witnesses this morning.

My first quick question is for you, Mr. Rae. You mentioned that you spoke with the Chamber of Commerce yesterday. What value do they put the Ring of Fire at as far as economic development for Canada is concerned?

9:30 a.m.

Partner, Olthuis Kleer Townsend

Bob Rae

I think the potential of the Ring of Fire is huge, and the estimates go very high, but the fact of the matter is that developing a resource like that, in addition to requiring the participation and consent of the first nations, also requires considerable infrastructure investment over quite a substantial period of time. Frankly, it also requires a different market condition. I mean, mining is in the tank right now, except for gold mining, because of prices. That's what is behind the challenge we've had.

9:30 a.m.

Liberal

Marc Serré Liberal Nickel Belt, ON

Correct. And really, in the last two days...and I know we had an opportunity to speak yesterday; I really appreciate the framing of the treaties versus Quebec, B.C., and the territories.

I am hearing today that you are working with the province to develop the regional framework with the first nations in northern Ontario. Then I'm hearing that INAC, on the federal side, is doing the same independently, when you're looking at a whole-of-government approach.

I know that we're really, as I think we're discussing today, moving forward in what is really new territory. It has never been done before. So it's not a criticism of what we have done in the past, but I want to hear your comments on this, Mr. Rae. We really have to pause right now and say, listen, we have to do a new approach. The old structures, with federal and provincial, will not work moving forward. But right now we're continuing with discussions, INAC with the first nations independently, and the province is also dealing with the first nations independently. I can see the confusion of first nations: who are they dealing with?

How do we bring it home, moving forward?

9:30 a.m.

Partner, Olthuis Kleer Townsend

Bob Rae

I think there is an effort to deal with this. We are a complicated country. It's not that easy. But I think there really is now a renewed effort to do that.

At the federal level, I had the opportunity to meet with the Clerk of the Privy Council to talk about this. Because of his former position as deputy, he is very much aware of the challenges. I know that the two levels of government, Ontario and Canada, are going to be talking at the senior bureaucratic level, the officials level, to try to coordinate activity.

One of the reasons for my being so quick to accept the invitation to speak here was to indicate that the clients I represent in northern Ontario are very interested in improving the connectivity between governments and us as we try to make some more progress, and I think that's going to happen. I am very confident that's going to happen. I think it's important that we keep trying to make that kind of progress, because I think it can be done.

9:35 a.m.

Assistant Deputy Minister, Lands and Economic Development, Department of Indian Affairs and Northern Development

Sheilagh Murphy

I'd just like to jump in here. I didn't want to leave the impression that we're not working with the provinces. When we look at community capacity development, definitely, as Mr. Rae has said, in the area of the Ring of Fire, the project that we're doing there has Ontario at the table with us. They are sitting there and they are part of our project.

Certainly, in a couple of weeks, deputies from across the federal government will be sitting down with deputies in Ontario to look at a range of issues, many of them focused on indigenous issues in northern Ontario to come up with a collaboration agenda. There's already collaboration happening, but this will help formalize it in terms of where we have some sticky points and what we want to try to work together to unlock. The Ring of Fire is part of that.

In terms of other parts of the country, again we do work with the provincial governments in trying to unlock and work on solutions. It's just that sometimes access to programming is a federal program, so skills training and development on reserve tends to be done more within the purview of the federal government than that of the provincial government. There are ASETS organizations that are run by first nations and work with communities. They are funded by the federal government. That's their porte d'entrée into skills training and development.

Provinces may come to that table, dollars may be brought to that table collectively around a project, but they have their own organizations that receive federal funding to take care of the on-reserve population. Sometimes it isn't necessarily all woven together as well as we might like, but certainly where there's opportunity, we are sitting with the provinces and collectively trying to work on solutions with communities.

9:35 a.m.

Liberal

Marc Serré Liberal Nickel Belt, ON

Mr. Rae, regarding the regional framework you discussed that was signed in 2014, which you're negotiating to finalize, are we involved in that? What's the federal role in that regional framework, which will be signed very shortly with the chiefs?

9:35 a.m.

Partner, Olthuis Kleer Townsend

Bob Rae

Well, what I'm hoping is that we can be making some progress on the further details of what we're going to be able to discuss. The federal government so far has not been part of the process. In our discussions, I think the province and the first nations are agreed that it's important for us to increase the level of discussion with the federal government, because there are some implications.

Just to give you one simple example, if you move from being a remote to a, quote, “road access” community, that affects your INAC funding. One of the things we hear from the communities is why would we agree to something that's going to affect our transfer payments from INAC? We then have to say, well, let's look at the overall range of things that are being done and make a difference that would actually allow people to feel more comfortable in how they come about making those decisions.

That's just one very small example, but there are others as well in terms of how roads are going to be funded, how electricity is going to be funded, how broadband is going to be funded, and so on.

I'll give you another example. We're trying to develop more of a community health approach within the Matawa region. We've had some support from the government to do that. We have some proposals on the table and some stuff is being done, and we're working with the Lakehead school and so on. I had a meeting the other day with the dean of the northern medical school of Lakehead and Laurentian. He told me, look, we don't have connectivity in the communities that's sufficient to allow us to put in the most up-to-date radiological equipment; we're still in the 1950s in terms of what it takes to get an X-ray from Eabametoong to Thunder Bay and to then say what the treatment is. As a result of that, for the relatively simply procedures, everybody has to leave town. Everybody has to be flown out. You fly out of Eabametoong, you fly to Thunder Bay, you stay overnight, your family comes down, and then you fly back. It's inconvenient for the individuals, it's hugely inefficient, and it's extremely costly.

We're wasting lots of money because we're simply not upgrading the infrastructure in these communities. That's a practical example of where the federal government is going to be involved with those discussions if we're going to be successful at making the breakthroughs we need.

9:40 a.m.

Liberal

The Chair Liberal James Maloney

Thank you.

Mr. Barlow.

9:40 a.m.

Conservative

John Barlow Conservative Foothills, AB

Thank you very much, Mr. Chair.

Thanks to our witnesses for being here and for providing some great information.

Mr. Rae, you were talking during your presentation about the process for engagement and the responsibility for consultation. In your own legal opinion and from your experience, what is the difference between consultation, engagement with first nations, and receiving consent? I look at Northern Gateway, and 28 first nations have signed on to that agreement. For the Pacific Northwest LNG, four to five first nations have signed agreements. But these projects haven't proceeded.

When we have multinational companies who are providing a lot of the capital for these projects, those multinationals have their fingers in a lot of pies around the world. I would think that they would be looking for jurisdictions where there's some sort of reality and they know the process. They know what the potential would be—maybe not the result, but they know that there is a defined process in place.

Certainly some of the feedback we're getting is that there is a lot of uncertainty right now because of this consultation process. In your opinion and your experience, when we talk about the duty to consult, is there a duty also to have unanimous consent? Where can we say that we've done our due diligence and we now have the support to proceed? We're talking about four to five on Pacific Northwest LNG, and 28 first nations on Northern Gateway, but we're still having trouble getting to the finish line with these.

I'd really appreciate your input on how you see that.

9:40 a.m.

Partner, Olthuis Kleer Townsend

Bob Rae

I don't think there's a simple answer to your question, but that doesn't mean we shouldn't be working together to find the answer that everybody can look at and say this is a reasonable implementation of the principle.

I also think this is something that's incumbent on first nations themselves to start to discuss among themselves, to talk about, well, how many...? You know, do we have referenda, or not a common mechanism? Bands and councils pass resolutions. They are what we call BCRs in the business. That represent the opinion of the chief and councillors. That constitutes the approval by the band, or the agreement by the band. Does there need to be a further referendum consultation with the members of the band?

Don't forget that the Indian Act bands are creations of the Indian Act, which means they're creations by a colonial government. If you look at the approval of a people, you're looking at broader than going beyond the boundaries of one band or another. You're looking at saying, well, we need to have the support of a majority of the people who are members of the first nations who are living along a pipeline: how do we do that?

You went from the word “consent” to “unanimous consent”.

9:40 a.m.

Conservative

John Barlow Conservative Foothills, AB

Right.

9:40 a.m.

Partner, Olthuis Kleer Townsend

Bob Rae

I don't think anything says that consent has to be unanimous. We're watching an American election. It won't be unanimous.

We need to listen to the first nations, for them to tell, for them to engage, to say, well, what's your definition of consent, and what is the governance that's going to be associated with this consent?

9:40 a.m.

Conservative

John Barlow Conservative Foothills, AB

So you're saying that if we have a majority, we're on the right track.

9:40 a.m.

Partner, Olthuis Kleer Townsend

Bob Rae

I'm saying there needs to be an agreement on a process to reach consent.

It's also a simple practical reality, particularly when you're looking at developments in remote communities. How would you propose to build a mine if a community right next to it is completely opposed to it? How much policing are you going to bring in? Are you going to bring in the army? Like, what's involved here? There has to be consent. There has to be a substantial degree of consent.

Instead of arguing about UNDRIP, which I don't think is very useful—that ship has kind of sailed—it's incumbent on us to say, well, this is how we interpret it, and this is how we think we're going to implement it. Quite frankly, it's not simply going to be the federal government alone determining this question, because the provinces are directly involved and the first nations are directly involved.

So yes, it's a challenge. We have challenges of governance. Many of the challenges of governance we have are created by the Indian Act and are a product of an act that, in my view, has to be completely changed. I put forward a private member's bill to get rid of it, so I think everybody knows how I feel about it. I think it stands in the way of reason in terms of our getting to the next stage of the relationship.

9:45 a.m.

Liberal

The Chair Liberal James Maloney

Thank you very much.

Unfortunately, that's all the time we have this morning.

I want to thank all three of you very much for taking the time to be with us today. Your attendance today will be very helpful in what we're trying to accomplish here, so thanks very much.

We'll suspend for one minute.

9:45 a.m.

Partner, Olthuis Kleer Townsend

Bob Rae

I'd like to thank the members of the committee, Mr. Chairman. Thank you very much.

9:50 a.m.

Liberal

The Chair Liberal James Maloney

Thank you.

9:50 a.m.

Liberal

The Chair Liberal James Maloney

We'll resume the meeting.

Moving right into our next segment, I want to thank our three witnesses for being here. They are from Des Nedhe Development, KWG Resources, and the Canadian Association of Mining Equipment and Services for Export.

We'll give each of you up to ten minutes to speak, then we'll open the floor to questions. There are earpieces for translation, if you need them, because you'll be receiving some questions in French. Of course, you're more than welcome to deliver your remarks or answer questions in French as well.

On that note, I will turn it over to you, Mr. Willy. You seem ready to go.

9:50 a.m.

Sean Willy Vice-President, Des Nedhe Development

Good morning. Thank you very much, Chair.

Thank you to the Standing Committee on Natural Resources for the invitation to participate. It's a great pleasure to be here this morning to provide you with my words about how Canada could support innovative and sustainable solutions to create economic opportunities for all Canadians in the mining sector.

First, let me recognize that today I'm speaking on the traditional lands of the Algonquin people.

I think we had a great overview by the Honourable Bob Rae, Sheilagh, and Stephen on the legal and public policy side of this discussion currently going on in Canada. I hope to offer a bit more of a pragmatic solution about how we start achieving some of these realities that we want to achieve in Canada.

Let me introduce myself. My name is Sean Willy. I am a vice-president for Des Nedhe Development corporation, an English River First Nation economic development corporation. In my current role I am embedded with our first nation-owned public affairs firm, Creative Fire, which has done substantial work with a few large resource companies—PotashCorp and Cameco, to name a couple.

I am also co-chair of the Canadian Council for Aboriginal Business and chair of the highly successful indigenous training partnership program Northern Career Quest in northern Saskatchewan, which has been funded through the skills partnership fund through ESDC. Over the last three years, Northern Career Quest has trained 1,800 people in northern Saskatchewan, with over 1,600 of those finding employment. That's an employment rate of 92%.

I am also on the board of the Aboriginal Human Resource Council. Last but not least, I was part of the creation and the first chair of the aboriginal affairs committee within the Mining Association of Canada.

Of most importance to me, however, is where I come from. I was born and raised in Canada's north. I was born in Inuvik, Northwest Territories. I've lived in Fort McPherson, Northwest Territories; Rankin Inlet, Nunavut; and Yellowknife, Northwest Territories. I am a member of the North Slave Métis Alliance, with strong connections to my Métis and Denesuline ancestry.

I grew up in a family with a Dene mother and a mining executive father, so a lot of the discussions we're having now on duty to consult and free, prior, and informed consent happened at the kitchen table as I grew up.

9:50 a.m.

Voices

Oh, oh!

9:50 a.m.

Vice-President, Des Nedhe Development

Sean Willy

I'm proud to say that I started in the gold mines of the Northwest Territories at 17 as a local indigenous hire. Why did they hire me? Well, in the Northwest Territories resource companies were forced to hire local indigenous people as part of their permits. I began a long and healthy career in the mining industry. In my career, which I started as a labourer, I was an underground worker, diamond machine sorter, workforce development coordinator, labour relations specialist, human resources superintendent, corporate responsibility manager, and finally director of corporate responsibility of Cameco Corporation.

At Cameco I was part of a team that led all indigenous community engagement activities in Canada, the United States, and Australia for all uranium projects. This led to innovative approaches to indigenous engagement strategies and plans. It included negotiating five community-based agreements in Canada and Australia and creating a leading-edge indigenous-driven legacy trust fund in northern Saskatchewan earlier this year.

One of the successful community agreements we negotiated and signed was with the Denesuline community of English River First Nation, 600 kilometres north of Saskatoon, for whom I now work through their economic development arm. English River First Nation has had a long history working with the uranium industry in northern Saskatchewan. Like any relationship, it has its ups and downs, but it's always moving forward. What English River saw was an opportunity. The community leaders, the elders, the chief and council, and community members saw that the world wanted and needed the world-class uranium deposits found in their traditional lands. They knew they could support this development and better their communities through the creation of businesses geared to work with the uranium mining companies.

Over the past 25 years, this has evolved into Des Nedhe Development. Just so you know, “Des Nedhe” means “important river” in Dene. That's the Churchill River that runs through northern Saskatchewan.

Des Nedhe is one of the most progressive tier-one aboriginally owned and driven entities in Canada. Des Nedhe is comprised of four distinct business pillars. The first is a retail and property division comprised of a 135-acre urban reserve bordering Saskatoon. This contains a gas station, convenience stores, and commercial property. In addition to this, we have property in Beauval, Saskatchewan. We have a gas station and store there. This borders some of the satellite reserves of English River. We also have a store within the home reserve of Patuanak, northern Saskatchewan.

The second pillar, and really the heart of Des Nedhe, is its industrial division. This includes the first English River company, Tron construction and mining. Tron was really created to do everything for the mining industry. It focused on concrete work, electrical, instrumentation, and construction. It has grown substantially in a good and progressive partnership with the uranium industry in northern Saskatchewan, but it has grown to secure additional work with Saskatchewan's potash mining industry.

In addition to Tron, Des Nedhe built a local consortium comprised of numerous first nations and Métis communities throughout northern Saskatchewan to secure all the development mining for Cameco's mining operations. This partnership has provided strong socio-economic benefits to many of the communities near Cameco's operations. Lastly there's Minetec, a mine supply company that supplies anything that the Saskatchewan mining industry requires, from nuts and bolts to toilet paper.

But to mitigate against the risk of putting all Des Nedhe revenues within the uranium industry, Des Nedhe has pursued a strategy to invest in some of Saskatchewan's blue-chip companies. In 2014 Des Nedhe purchased a majority interest in the already-mentioned Creative Fire, whose 20-year experience in corporate services essentially raises the bar in Canada on what is an aboriginal service firm. With clients such as Federated Co-op, Cameco, Canpotex, the City of Saskatoon, and PotashCorp, Creative Fire offers Des Nedhe a new revenue stream and new employment opportunities for our indigenous owners.

In addition to Creative Fire, in 2015 Des Nedhe, in partnership with Peter Ballantyne Cree Nation, purchased 60% of JNE Welding, a large, well-respected fabrication welding firm in Saskatoon. JNE provides services to a number of large clients who require steel. This includes potash, uranium, oil and gas, and manufacturing industries.

The last business segment of Des Nedhe is the recently created SAGE Power, which is a 100% renewable power company that, when partnered with our other Des Nedhe group of companies, becomes the only indigenous vertically integrated renewable power company in Canada.

Des Nedhe is a leading example we are proud to represent, which highlights what can be achieved when local first nations are engaged and partnerships are created and developed within the mining industry.

One of the questions posed within this standing committee is this: how we can ensure that indigenous peoples and communities are meaningfully engaged through all stages of mineral development and production? In my experience, the great majority of indigenous communities are not against resource development, even though it may be portrayed this way. In my discussions from coast to coast to coast, I see that indigenous people want to be treated as partners, not a regulatory check box. Our communities want to ensure that their views and inputs are incorporated throughout the development of mineral resources, especially when it comes to environmental planning, monitoring, and into decommissioning. The bottom line is that indigenous communities will support mining development, but not at the expense of a poor environmental stewardship plan.

At the core of this discussion is “how”. In my experience, the key is to create community-driven input and build that relationship right from the start. Yes, we need the policy and we need the legal framework, but I would ask you to also remember the young boys and girls out there who just want the opportunity for a job. Sometimes we get stuck in rhetoric around the law and around public policy, which are great long-term objectives, but value to Canadians is created when we hire people in local communities who are currently on social assistance. You hire individuals, you give them an opportunity on a drill rig, or during exploration, or a labour position at a gold or uranium mine, and they start paying taxes into the system. So they turn into a net positive for everybody in this country from a GDP angle.

As mentioned above, environmental stewardship is key, but of most importance is how you engage the community. A robust community engagement plan will flesh out both parties' intents and long-term objectives. In most instances I've seen, companies and communities may even find shared objectives. A good example of this is in northern Canada. When a community and company sit down, you might flesh out how road access is important to company and community, so how do you work together on investments, on P3 ideas, to provide a road that would lower cost of living in the community and also make the deposit more accessible?

These shared objectives will lead to socio-economic benefits that will be shared. These include creating pillars such as workforce development, which essentially means the training, education, and employment of local indigenous people. In Canada the mining industry has been a strong champion in the employment of thousands of indigenous people like me. Many have gone on to strong careers. Not only employment but supportive education, through scholarships and the support of pre-employment training programs, provide opportunities to future generations.

Second is business development, where community and company come together to discuss and plan on how to provide mining service contracting opportunities to local indigenous communities. We have found that investment in local aboriginal business plans is the best way to close the gap on socio-economics, as it not only spurs additional employment but also provides communities with own-source revenues.

Third is community investment. This can take many forms, from straight revenue-sharing via impact benefit agreements to annual budgets where company and community work together to fund community projects like education, culture, elder projects, or youth projects.

Last, we come back to environmental stewardship. As mentioned before, it is key that indigenous input is captured throughout the process—but how? Programs such as joint committees, elders traditional knowledge workshops, and youth engagement sessions are all great tools to ensure that community input is obtained. Leading-edge programs in Canada go so far to provide all the decommissioning work directly to the closest indigenous community as a business opportunity, so that they have a stake both in the opportunity of the clean-up but also to monitor the progress.