The way to break the Northern Gateway logjam: aboriginal equity – by Brian Lee Crowley and Ken Coates (Globe and Mail – January 3, 2013)

Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Brian Lee Crowley and Ken Coates are co-leaders of the Aboriginal Canada and the Natural Resource Economy project at the Macdonald-Laurier Institute, an Ottawa-based public policy think tank.

The bitter debate over the Northern Gateway oil pipeline project shows Canadian policy-making at its worst.

A piece of nationally significant infrastructure, the project is currently mired in a toxic mess, assailed by environmentalists, targeted by vote-hungry B.C. politicians and publicly challenged by many first nations. You could be forgiven for feeling a dreadful sense of déjà vu.

In the 1970s, an ambitious plan was mooted for a natural gas pipeline down the Mackenzie Valley. Aboriginal people and environmentalists protested. Justice Thomas Berger was named to head an inquiry that galvanized opposition to the pipeline, recommending that it be delayed until aboriginal people were ready to participate fully.

Eventually, companies created new aboriginal partnership models. Aboriginal communities and governments grew more familiar with the project and innovated by becoming equity partners. While some opposition remained, most in the region supported a pipeline that promised jobs for the North and revenue for aboriginal governments.

But in an object lesson in the perishable nature of opportunity, by the time the project was finally approved, northern gas was no longer competitive with low-cost shale gas closer to markets. The opportunity now appears lost for a generation. If we don’t want the same to happen in our efforts to get Canadian oil to the West Coast, we need to learn the lessons of the Mackenzie Valley.

For the Inuvialuit (Inuit of the Western Arctic) and the first nations of the Mackenzie Valley, the pipeline was an unprecedented opportunity. The combination of the pipeline, modern treaties and self-government held out the prospect of overcoming generations of paternalism and poverty. Equity investment in the pipeline, secure revenue and local jobs were precisely the solutions aboriginal people sought to their problems. Delay put paid to those opportunities for decades to come.

A similar situation is unfolding along the Northern Gateway route. The opportunity is huge. As Justice Berger said in his inquiry’s final report, location is a natural resource. Northern British Columbia’s location matters because our oil is more valuable if we can get it to energy-hungry Asian markets. And Northern B.C. is the logical route to tidewater. But unless we respect and build on aboriginal aspirations, the fate of the Mackenzie Valley beckons.

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