• What is the role of mining companies in aboriginal consultation?

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    Canadian courts have established a duty to consult with Aboriginal Peoples on decisions that may impact land and resources subject to aboriginal claims. In practice, however, there is a lack of clarity on who is consulting, how much consultation is required, and when this requirement has been satisfied. This lack of clarity has led to frustration on the part of both mining companies and aboriginal groups, in some cases delaying projects that are in the interest of both groups.

    Responsibility for consultation

    The Canadian constitution recognizes three groups of Aboriginal Peoples: First Nations, Métis, and Inuit. In Canada, “the Crown [usually the provincial government] is obliged to consult with and perhaps accommodate aboriginal groups if there is a prospect that aboriginal or treaty rights will be affected by a resource development authorized by government” [1, p.214-10]. Examples of accommodation could include protecting burial sites or minimizing disruption to hunting and trapping activities.

    The obligation to consult and accommodate was affirmed by the Supreme Court of Canada in landmark decisions such as Haida (2004), Taku River (2004) and Mikisew Cree (2005). [2] Third parties, such as mining companies, do not have a legal obligation to consult aboriginal groups and the ultimate responsibility for consultation and accommodation rests with the Crown. [2, p.20]

    Delegation of consultation by the Crown

    The Crown is able to delegate aspects of consultation to mining companies. For example, the Crown may delegate information gathering on the potential impacts of a mining project on aboriginal or treaty rights. [2] Information collected during consultation can be used by the federal government in its decision-making process. However, the ultimate responsibility for consultation and accommodation rests with the Crown. [2] Consultation responsibilities may also be delegated to mining companies as part of a provincial or a federal environmental assessment process. [1, p.214-19]

    Such delegation can create problems for both aboriginal groups and mining companies. Mining exploration companies (also known as “juniors”) are usually small- or medium-sized companies with limited resources. These companies face uncertainty about expectations for consultation on land claimed by aboriginal groups [3, 4] including significant variation in potential or established aboriginal or treaty rights, overlapping claims, determining whom to consult, and ensuring that all aboriginal groups have an opportunity to express their interests and concerns [2]. There are also allegations that some aboriginal communities may chose not to consult, or expect financial compensation prior to consultation. [4-6]

    Delegating Crown consultation obligations to industry can also create frustration for Aboriginal communities. Aboriginal communities may have limited capacity to deal with multiple resource companies [7], or may be unaware that a company has been delegated consultation or the degree to which consultation was delegated. [8]

    Some aboriginal groups have responded by creating guidelines and protocols to guide consultation and provide contact information. Although these protocols do not have the force of law, companies may find it in their best interest to follow these protocols since ignoring them can invite resentment, protests, delays, legal action and, in extreme cases, armed resistance. [9] Failure to follow existing mining protocols may also be interpreted as a sign of disrespect, according to Howard Hampton of Fasken Martineau DuMoulin LLP. [10] These protocols may be a positive step in helping create a common understanding between mining companies and aboriginal communities, but may lack a detailed process for consultation or what is considered ‘meaningful consultation’. [9, 11]

    Degree of consultation required

    The scope of the duty to consult and how much consultation is sufficient is also problematic in Canada. One challenge lies in the fact that potential or established aboriginal or treaty rights vary both in scope and content, and issues addressed in consultation are specific to the location and nature of the activity. [2] This variation in rights means that the consultation process needs to be adapted to address different kinds of rights and Crown obligations, in which significant differences exist. [2] It also means that there is no clear process, formula, or set of guidelines for mining companies to follow. [10]

    Such variation and lack of certainty makes the duty to consult subjective, with no clear formula or guidelines for what is sufficient or has satisfied the duty. [3, 10] It can also create conflict and frustration as mining companies can be granted full legal access to a property despite aboriginal opposition leading to litigation and court challenges. [10]

    Early and ongoing consultation

    While mining companies are not legally obliged to consult with aboriginal groups, it is often preferable for them to be active in the process. Mining companies have a vested interest in the consultation process since their project may be at risk if consultation is inadequate. [1] Court decisions have disallowed private companies from relying on existing provincial authorization where the consultation process was deemed inadequate. [1, p.214-19]

    By consulting with aboriginal groups early on, mining companies can also help build good relationships, share necessary information, and reduce the risk of future challenges to government decisions. [1] Creating good relationships with aboriginal groups can help mines attract a motivated workforce after mining operations begin. [12] Mining companies face a growing skill and labour shortage and aboriginal workers can help fill this need. Aboriginal communities can also benefit from the employment, training and economic growth opportunities of mining. [13, 14]

    Canadian mining industry guidelines

    The Mining Association of Canada recognizes and respects the unique role, contributions and concerns of Aboriginal Peoples (First Nations, Inuit, and Métis) and indigenous peoples worldwide in all business operations [15]. Members have agreed to various commitments in their relationship with Aboriginal Peoples including developing open relationships, building cross-cultural understanding, undertaking early and culturally appropriate engagement, supporting and encouraging Aboriginal involvement in environmental monitoring.[16]

    The Prospectors & Developers Association of Canada (PDAC), through its e3-Plus Principles for Responsible Exploration, has stipulated that interaction with indigenous people should be based on respect, inclusion, and meaningful participation, in ways that create minimal disturbance to the environment and people. [17] PDAC also advises explorers to: “a. Consult with relevant parties prior to entering land for the purpose of exploration activities, and develop a process and a schedule for obtaining access to land and providing appropriate compensation for harm arising from exploration activities […]; b. Pay reasonable costs for the resources needed to obtain permission including, where necessary, the provision of expert advice to support the community […]; c. Where possible, enter land and conduct physical work on the basis of an agreement for access and compensation […]”[17, p.17].

    PDAC’s e3 Plus e-Toolkit Excellence in Social Responsibility (ESR) also makes a series of specific recommendations for community engagement and consultation such as: to start the consultation and engagement process as early as possible; ensure that different aboriginal groups are able to similarly negotiate and benefit from agreements; being clear about objectives and expectations; and the advantages of signing Agreements or Memorandums of Understanding “before major physical work (drilling or trenching) begins”[18, p.111].

    In Canada, Impact Benefit Agreements (IBAs) are increasingly being reached between aboriginal communities and mining companies and they are regarded as best practice in prior and informed consultation. [19] IBAs are legally binding agreements that typically include “commitments and targets in the areas of employment, training, business opportunities, revenue or equity sharing, and environmental protection; and […] establish clear, formal channels for communication and dispute resolution” [19, p.13]. Of the 46 largest mining companies worldwide, 13 have adopted a formal policy on indigenous people; 13 have implemented strong systems to consult with and to benefit indigenous people; and 16 have signed IBAs, mostly in Canada and Australia. [19, p.14]


    Case Study: Impact Benefit Agreement in Troilus Mine

    Troilus Mine is a gold and copper open pit mine that belongs to INMET Mining Corporation, a mining company with head offices in Toronto. [20] Troilus Mine is located in northwest Quebec, in the James Bay territory. This region has had an extensive mining history but prior to the Troilus Mine, aboriginal and First Nations participation in mining was limited. [21, 22] Over the past 30 years there were 25 individual mining operations but “there is essentially no history of Aboriginal employment”. [22, p.14]

    Discussions and consultation between the Mistissini Cree Nation Band Council, affected trappers and the mining company INMET began during the mining feasibility stage and took place over more than two years and prior to the mine being approved by the Ministry of Sustainable Development, Environment, and Parks of Quebec in 1994. [23] In 1994, INMET and the Mistissini Cree Nation signed an agreement to begin the construction of Troilus mine [9] and in 1995 an Impact Benefit Agreement (IBA) was reached. [9, 23]

    The IBA between INMET and the Mistissini Cree Nation was “the second agreement signed between a mining company and an Aboriginal community in Canada”. [23, p.52] This agreement included provisions for training, employment, service contracts, communications, a compensation package for families whose livelihood is affected by the project, and participation of the Cree in environmental monitoring. [9, 20-23] However, “the main objectives were to provide employment and economic opportunities”. [23, p.52] It was “the first corporate-Aboriginal agreement in mining to have set an employment target for the Cree workforce which should reach 25%.” [23, p. 52-53] It was also “the first agreement in the Cree territory to provide specific compensation to the affected families” which generated mixed feelings in the community, with some in support and others against it. [23, p.57]

    When the agreement was reached, an Implementation Committee (IC) was formed. This committee was comprised of six members: three appointed by the Cree Nation of Mistissini and three by INMET. Decisions were made by consensus and required the approval of four members. [23] The IC decided that it would not deal with day-to-day management issues but only with “general issues.” An example of such an issue resolved through the IC was complaints about the use of the Cree language on the work site. The IC decided that Cree language could be used on the mining site “unless it affected safety of [other] workers” [23, p.58]. The IC also identified “training needs for the Cree manpower” [23, p.58] including off-road truck driving and heavy machinery operations.

    INMET’s head office and human resources department were active and committed to hiring Cree members and overcoming racism from other employees. [23, p.60] Various human resource measures were adopted including two training courses in off-road truck driving and heavy machinery operations at request of the IC; [23] a Cree Employment Coordinator participated in the hiring and support of Cree workers; [23] and work schedules were modified “to accommodate traditional hunting activities by Cree mine employees”[9, p.37]. [22]

    The implementation of the IBA was relatively successful. During the first years of operations at the Troilus Mine, slightly more than 25% of total employees were members of the Cree Nation of Mistissini. [9] In 1998 the Cree “made up half of the drivers at the mill.” [22, p.14] However, by 2006 and 2007 Cree workers had decreased to about 15% of total Troilus employees. [24, 25] This reduction was due to various factors, such as personnel turnover at the management level and the construction of a hydro-electric plant, which increased employment opportunities and attracted Cree workers. [23]

    Members of the Cree nation gained mining experience through the Troilus agreement, allowing them to identify the opportunities and challenges of their participation in the mining sector. [26] The Cree nation government has since developed a Cree Nation Mining Policy based on three fundamental pillars: 1) promotion and support of mining practices; 2) mining and sustainable practices; and 3) transparency and collaboration. [26] Cree communities have also continued to work with the mining industry and have recently announced agreements with GoldCorp for the Éléonore gold property, and Stronaway Diamond Corp. for the Renard Diamond Project. [12, 14]

    The Troilus mine benefited from their early and ongoing engagement with the Cree nation. By consulting and engaging with the community, they were able to negotiate an agreement that permitted access to mineral resources and provided a base for a harmonious relationship with the Cree.



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    References

    1Higgins, C., et al., Chapter 214 - Aboriginal Issues, in Canadian Mining Law, from the Second Edition of the American Law on Mining, C. Higgins, Editor 2007, Available from: http://www.fasken.com/files/upload/ch%20214.pdf.

    2Canada, Aboriginal Consultation and Accommodation: Updated Guidelines for Federal Officials to Fulfill the Duty to Consult, 2011, Department of Indian Affairs and Northern Development.

    3Thompson, J., Treaty 3 ready to sit down with Miners United group, in Kenora Daily Miner and News, April 12, 2012, http://www.kenoradailyminerandnews.com.

    4Porter, J., Junior miners seek their own voice, in CBC news, March 29, 2012, Available from: http://www.cbc.ca/news/canada/thunder-bay/story/2012/03/29/tby-miners-united.html.

    5Editorial, KI ‘wins’ in mining’s loss, in The Chronicle Journal, March 7, 2012, Available from: http://www.chroniclejournal.com/editorial/daily_editorial/2012-03-07/ki-%E2%80%98wins%E2%80%99-mining%E2%80%99s-loss.

    6Hill, M., Ontario junior gets C$3.5m settlement to cede controversial claims, in Mining Weekly.com March 30, 2012, Available from: http://www.miningweekly.com/article/ontario-junior-gets-c35-million-settlement-to-cede-controversial-claims-2012-03-30.

    7Wabauskang mobilizes against Red Lake resource boom in Wawatay New Online, April 11, 2012, Available from: http://www.wawataynews.ca/archive/all/2012/4/11/wabauskang-mobilizes-against-red-lake-resource-boom_22631.

    8Gray, J., A cautionary tale for the mining industry, in The Globe and Mail, March 6, 2012, Available from: http://www.theglobeandmail.com/report-on-business/industry-news/the-law-page/a-cautionary-tale-for-the-mining-industry/article2360860/

    9Hipwell, W., et al., Aboriginal Peoples and Mining in Canada: Consultation, Participation and Prospects for Change (Working Discussion Paper), 2002, Prepared for the North-South Institute.

    10Hasselback, D., Native law a growing field in National Post, March 6, 2012, Available from: http://www.nationalpost.com/related/topics/Native+growing+field/6255626/story.html.

    11Kluane First Nation (KFN) Burwash Landing, Proponents Engagement Guide, 2012, Draft: January 10, 2012.

    12Praet, N.V., Stornoway wins ‘social licence’ in talks with Cree for Quebec diamond project in National Post, March 27, 2012, Available from: http://business.financialpost.com/2012/03/27/stornoway-wins-social-licence-in-talks-with-cree-for-quebec-diamond-project/.

    13Canada, Natural Resources Canada [NRC], Aboriginal Participation in Mining: Exploration, 2006.

    14Borsato, J., A giant step in the mining agreement process [Goldcorp and Cree Nation of Wemindji], in CIM Magazine 2011.

    15The Mining Association of Canada, Towards Sustainable Mining - Guiding Principles, 2004.

    16The Mining Association of Canada, Towards Sustainable Mining Framework - Mining and Aboriginal Peoples, 2008.

    17Prospectors & Developers Association of Canada (PDAC), Principles and Guidance, in e3PLUS: A Framework for Responsible Exploration: http://www.pdac.ca/e3plus/English/pg/pdf/e3plus-pg-full.pdf.

    18Prospectors & Developers Association of Canada (PDAC), Excellence in Social Responsibility e-toolkit (ERS), 2009.

    19Sosa, I., License to Operate: Indigenous Relations and Free Prior and Informed Consent in the Mining Industry, 2011, Sustainalytics.

    20Inmet Mining Corporation, Section 2.0 Annual Information Form, in Annual Review 2008, 2009.

    21O’Reilly, K. and E. Eacott, Aboriginal Peoples and Impact Benefit Agreement: Summary of the Report of a National Workshop, in Northern Perspectives,1999, Canadian Arctic Resources Committee (CARC).

    22O'Reilly, K. and E. Eacott, Aboriginal Peoples and Impact and Benefit Agreements: Report of a National Workshop, in Northern Minerals Program Working Paper No. 7, 1998, Canadian Arctic Resources Committee (CARC).

    23Krekshi, L.E., Indigenous Peoples' Perspectives on Participation in Mining: The Case of James Bay Cree First Nation in Canada, in Department of Urban Planning and Environment 2009, Kungliga Tekniska högskolan [KTH]: Stockholm.

    24Inmet Mining Corporation, Troilus, in INMET Mining Corporation 2006 Sustainability Report, 2006.

    25Inmet Mining Corporation, Troilus, in INMET Mining Corporation 2007 Sustainability Report, 2007.

    26Cree Nation Government, Cree Nation Mining Policy, 2009: Available from: http://www.gcc.ca/pdf/ENV000000014.pdf.

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