Alternatives North Report Supports DFN Position on Pipeline

Alternatives North, a coalition of environmental and social justice groups, released a report today on the economics of the proposed Mackenzie Gas Project (MGP). The report clearly shows that the MGP will generate huge windfall profits for Imperial Oil and its partners in the project, while First Nations and northern governments will be left with crumbs under the current royalty regime in the NWT. The report comes at a time when Imperial continues to publicly claim that the project’s economics are “marginal” and that they need more hand-outs from taxpayers before they will move forward with the project.

The report also confirms what the DFN has said for a long time: that the pipeline itself may not be economical, but the rich gas fields which will supply the gas to fill the pipeline and which are part of the broader MGP are incredibly profitable under Canada’s current royalty regime. We have been saying for years that First Nations should avoid the trap of borrowing money to build a marginally economic pipeline and instead focus on getting control over our lands and resources, especially our petroleum. Only by getting control can we ensure that our environment is protected and northern people get a fair royalty from the sale of our resources.

Since 2001 there has been a lot of pressure applied to the DFN to join the Aboriginal Pipeline Group (APG) and invest in the construction of the pipeline. The APG is a partner with Imperial in part of the MGP – the construction and ownership of the pipeline – but it does not own any of the gas which will fill the pipeline. We have long suspected that the APG deal is really just a way to get First Nations to finance the construction of the pipeline and distract us from getting control over the much more lucrative gas fields which lie under our lands. Nevertheless, we agreed to study the APG deal and consider joining the APG if we could be satisfied that it makes economic sense. Unfortunately, the APG has refused to let us see the agreements that they want us to sign, despite the fact that we agreed to all of their confidentiality demands.

The Dehcho First Nations have never surrendered our title to our lands and our Treaties with the Crown confirm that we are the governing authorities of our land. These realities must be addressed before we will allow the Mackenzie Gas Pipeline mega-project to be built on our land. More than 40% of the territory to be covered by the pipeline is in the Dehcho.

Grand Chief Herb Norwegian said: “The current royalty regime is a sweetheart deal for the multi-national oil companies. Canada is giving our resources away for next to nothing while these companies continue to demand more and more hand-outs from taxpayers. This new report shows once again that the DFN have made the right decision by refusing to let our lands be used for new developments which will result in massive windfall profits for large corporations but not generate significant benefits for our people. Since Canada is unwilling to act to reform the royalty regime we must insist that Canada recognize our jurisdiction over our natural resources so that we can implement appropriate reforms. We have been negotiating for years with Canada to resolve issues of ownership and jurisdiction over our lands. At the same time we have been working cooperatively with Canada to develop a comprehensive land use plan for the Dehcho territory. We have consistently said that it makes no sense for us to approve a mega project on our land while the issues of title and jurisdiction remain unresolved.”

For further information contact: Grand Chief Herb Norwegian at: (867)695-2355 or (867) 874-1249