Bill Gallagher served as a strategist to Voisey’s Bay Nickel Company on forging key Native impact and benefits agreement alliances. He is the author of Resource Rulers: Fortune and Folly on Canada’s Road to Resources, available on Amazon.com (see his blog: http://billgallagher.ca/resource-rulers-book/)
Ring of Fire followers should plan on becoming Voisey’s Bay followers, given the close parallels and missed outcomes after five years of project wheel-spinning.
I helped develop a recovery strategy for the Labrador nickel project and it would appear that likewise, that’s what’s needed today for the Ring of Fire chromite project. All the same factors are in play and, to cut to the chase, if you can get Native communities onside then all the other project blockages will soon start to dissipate.
For Inco, original owner of the Voisey’s Bay mine, the triggering event was the following headline: “Voisey’s Bay gets aboriginal support: sources” (Canadian Press Nov. 30 2001). Here’s what project followers need to know in order to make up for lost time on the Ring of Fire’s road to resources.
Both the Voisey’s Bay and Ring of Fire projects were discovered by prospectors who were out looking for diamonds in remote regions of Canada. Both discoveries triggered massive staking rushes and wild stock speculation scenarios. Both saw the specter of instant millionaires being met with concerted Native blockades.
Then, in both cases, blue-chip mining majors took over – foreigners in the eyes of locals – while seemingly unaware of the turbulent history of northern resource development.
Indeed, both hyped their projects, giving rise to the ‘golden goose’ syndrome, fed by fawning media commentary.
Both fielded teams of Toronto consultants with litigation-based strategies that seemingly invited court challenges. But both projects soon lost key entry-level rulings to the Native side. Both projects had proposed an access road – straight as an arrow – and once again both lost critical rulings denying access to their discoveries.
As a result, both projects experienced: significant stock drops, managerial realignments, project postponements, the appointment of key public influencers, and last but not least, a series of no-nonsense press releases citing their projects to be in serious jeopardy.
Typically, the squandering of five years of project development, and losing two key court rulings in a row, puts any resource project in the death zone. Maritimes and Northeast Pipeline had a similar experience and barely squeaked through by virtue of a last-minute (court-mandated) settlement with their Native protagonists. Not so lucky was the Mackenzie Valley Gas Pipeline Project, which never recovered from its two legal losses to the Native side. Those back-to-back losses contributed to the extended delays and cost overruns that ultimately killed that vital piece of northern infrastructure.
Really, the only project that succeeded in turning ‘a sow’s ear into a silk purse’ was Voisey’s Bay; and even at that it took a Herculean effort to forge the essential public, mining and Native partnerships. But the good news: it can be done!
Neither James Bay Lowlands nor northern Labrador offered any existing real infrastructure: no roads, no rail, no hydro, no ready labour force. To this end, both provincial governments seemed to be missing in action in terms of generating the proper climate for those essential public, mining and Native partnerships.
Here are key quotes from the three aforementioned projects that explain the hit-or-miss strategies that dictated those project outcomes:
• “… a March 12 proposal by Maritimes and Northeast Pipeline to waive aboriginal title is unacceptable.” –Chief Terrance Paul quoted in Halifax Daily News, April 1, 1998.
• “One of the problems we have is that we manage to conduct regulatory processes that drag projects out until the project simply dies of old age, before it goes ahead. We’ve seen that in the case of Mackenzie (Valley Gas Pipeline Project.)” –former TransCanada CEO Hal Kvisle quoted in Globe & Mail, Nov. 26, 2010.
• For a mining company, the development of Voisey’s Bay was perhaps as complicated a scenario as anyone could dream up. The way ahead was unclear. Clashing views and competing stakeholder issues created barriers. It would take great effort on the part of all stakeholders to bring them down. – excerpt from Nickel on the Big Land – a Voisey’s Bay Nickel Company project retrospective)
What’s missing in the Ring of Fire today is an overarching strategy and commitment to pull together. By now it should be apparent that letting litigation set the agenda does little to advance the public interest; simply put, the public interest has yet to manifest itself – political sound bites notwithstanding.
In fact, Voisey’s Bay only started making real progress when an entirely different strategy was employed: one that advanced a unity of interests as opposed to diverse private interests. Even then it took several more years to come to terms as a viable project.
Thus, Voisey’s Bay successfully transcended its death zone after five years squandered and back-to-back legal losses. It stands as a singular example of what to do and what not to do for all factions currently engaged in the Ring of Fire. Viewed as a ‘four-square’ template, it could well serve to promote the fast-tracking of successful outcomes in the Ring of Fire.