Canadian Mining Journal January 2018 by The Northern Miner Group

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BC & THE NORTH FIRST NATIONS & MINING: A PROGRESS REPORT

JANUARY 2018 | www.canadianminingjournal.com | PM # 40069240

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CANADIANMINING

JANUARY 2018 VOL. 139, NO. 01

JOURNAL

CMJ 11

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FIRST NATIONS & MINING C A N ACanadian D I A N MAboriginal I N I N G J OMinerals U R N A LAssociation cofounder Hans Matthews 11

speaks about the 25th anniversary of CAMA and the changing relationship between Aboriginal communities and mining companies.

15 The Nation to Nation conference examines the way forward for Canada’s Indigenous Peoples.

B.C. & THE NORTH 20 What B.C.’s new NDP government will mean for the mining sector. 25 Changing tailings management expectations shape Western Copper & Gold’s Casino mine proposal.

FEATURES

29 Trends in mine closure from the Progressive Mine Forum, organized by The Northern Miner.

DEPARTMENTS 5 EDITORIAL | The pressure’s on. 6 LAW | Toby Kruger, Keith Bergner and John Olynyk of Lawson Lundell discuss the implications of the Peel River case. 8 FIRST NATIONS | AFN Ontario Chief Isadore Day calls for consultation around the legalization of cannabis. 9 FAST NEWS | Updates from across the mining ecosystem. 32 CSR | Lawyer Michael Torrance discusses recent guidance from the IFC on the use of security forces. 34 UNEARTHING TRENDS | Christian Kittleson, Brittany Trumper and Courtney Loftus of EY on creating true partnerships in natural resource development.

www.canadianminingjournal.com JANUARY 2018

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29 ABOUT THE COVER

This month’s cover supplied by BME.

Coming in Feb/Mar Canadian Mining Journal looks at mining in Ontario, plus the Sudbury/North Bay innovation cluster

For More Information

Please visit www.canadianminingjournal.com for regular updates on what’s happening with Canadian mining companies and their personnel both here and abroad. A digital version of the magazine is also available at www.digital.canadianminingjournal.com

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FROM THE EDITOR

CANADIANMINING January 2018 Vol. 139 – No. 1

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Editor-in-Chief Alisha Hiyate 416-510-6742 ahiyate@canadianminingjournal.com CTwitter: A N A D I A N@Cdn_Mining_Jrnl MINING JOURNAL

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In 2018, the pressure’s on

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Alisha Hiyate

n the fall, I moderated a roundtable discussion on mine closure at The Northern Miner’s inaugural Progressive Mine Forum. Unfortunately, about half of the audience got up and left the room just before we started. It was the last discussion of the day, so one might be tempted to chalk it up to fatigue or an effort to get an early jump on post-conference drinks. But, in reality, it’s not an unusual reaction to the topic of mine closure. It just seems to make miners’ eyes glaze over. The paradox, however, is that mine closure is actually the subject that the public is most interested in – and the source of a lot of opposition to mining (see Page 29). Water and tailings management – especially in the wake of the 2014 Mount Polley tailings dam failure – is at the heart of the mining industry’s ability to earn a social licence to operate. That makes it an existential issue for miners. A timely example is Western Copper & Gold’s Casino project in the Yukon (Page 25). The large porphyry copper-gold deposit had already entered the permitting process when the Mount Polley failure occured. But the 120,000-tonne-per-day proposed project, which would require sizable tailings facilities, is seeing increased scrutiny as a result of Mount Polley. In response to concerns around tailings, Western Copper & Gold is having to make changes to some elements of its original proposal. Chiefly, the company is investigating design changes to the tailings dam that would reduce the amount of stored water – and therefore the impact of any potential failure – at Casino. Water and environmental management are also top concerns for another group that has an even bigger say in whether resource projects get approved – Aboriginal groups. Indigenous communities across the country have found their voices when it comes to resource development and many other issues – and the courts and governments are listening (see Page 15). Some communities are using their growing power to demand a different approach to environmental assessments – an emerging trend that Hans Matthews, president of the Canadian Aboriginal Minerals Association (CAMA) sheds light on in an interview with CMJ (Page 11). In British Columbia, we see something of a perfect storm when it comes to conﬂict around mineral development. The province is mineral-rich – including in porphyry deposits whose development necessarily has a big and visible impact on the land; there are unsettled land claims across much of the province; and its dramatic landscapes of majestic mountains and wild rivers invite the passionate efforts of environmentalists to protect it and preserve it from change (Page 20). Mining companies hoping to develop mines there will increasingly have to prove much more than the economics of their projects – they’ll have to shrink their project footprints and meet an extremely high bar in environmental management. There’s no better reason for miners to get interested in mine closure and what they leave behind when a deposit is mined out. Because what companies have left behind in the past haunts the entire industry CMJ today. And the pressure is on to do better. CANADIAN MINING JOURNAL |

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LAW

Implementation of modern treaties: Lessons from the Peel River case By Toby Kruger, Keith Bergner and John Olynyk

n Dec. 1, the Supreme Court of Canada (SCC) released its decision in First Nation of Nacho Nyak Dun v. Yukon. The decision addresses the Yukon government’s obligation to follow the land use planning process set out in modern land claims agreements with First Nations. While the decision arises from a land use planning regime unique to Yukon, it will have implications for how governments and courts approach interpretation of modern treaties across Canada. By extension, the decision will have implications for resource developers in areas that are covered by modern treaties. Background Yukon First Nations, Canada and the Yukon government entered into modern treaties (called ﬁnal agreements) that contain provisions setting out a multi-stage process for collaborative development of land use plans: w Step 1: An independent land use planning commission develops an initial recommended plan. .

w Step 2: Yukon government is required to consult on that initial plan before approving, rejecting or proposing modifications to it. w Step 3: In response to Yukon’s decision, the commission is then required to reconsider as necessary and propose a Final Recommended Plan. w Step 4: Yukon government is again required to consult on the final recommended plan before final approval, rejection or modification. In this case, Yukon provided very general requested changes to the initial recommended plan (at Step 2). When the commission submitted the Final Recommended Plan, Yukon then proposed substantial modifications (at Step 4). The trial judge found that to be “an ungenerous interpretation not consistent with the honour and integrity of the Crown.” He remitted the process back to Step 4 and held that it was not open to Yukon to reject the Final Recommended Plan. The Court of Appeal agreed that Yukon had run afoul of its obligations under the treaties, but imposed a significantly different remedy. It ordered that the parties return to Step 2, which would effectively have given Yukon an opportunity to 6 | CANADIAN MINING JOURNAL

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The decision reminds governments that treaty rights contained in modern treaties are to be given a large and liberal interpretation that upholds the honour of the Crown.

propose extensive changes to the plan. In many ways, for the Yukon First Nations this was “winning the battle but losing the war,” and they appealed to the SCC. Before the SCC, Yukon did not contest that it had not complied with the process set out in the final agreements. The issue was whether the land use planning process should be sent back to Step 2, or to Step 4 where Yukon’s options were limited to approving, modifying or rejecting the Final Recommended Plan. This was more than an academic dispute about processes. The Final Recommended Plan had proposed significant limits to resource development in the Peel River region. Yukon wished to override those limits through extensive changes. If the planning process was only sent back to Step 4, Yukon’s ability to make those changes would be more limited. Decision The SCC returned the parties to Step 4, significantly narrowing the range of modifications Yukon could make to the plan. The SCC stated:

“… Yukon must bear the consequences of its failure to diligently advance its interests and exercise its right to propose access and development modiﬁcations to the Recommended Plan. It cannot use these proceedings to obtain another opportunity to exercise a right it chose not to exercise at the appropriate time.” The SCC was clearly concerned that the Court of Appeal had inserted itself into the ongoing treaty relationship by returning the parties to an earlier stage of the process. Similarly, the SCC was concerned that the trial judge had also gone further than needed by ordering that Yukon must either accept or modify the Final Recommended Plan based on recommenwww.canadianminingjournal.com

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dations it had previously proposed. The SCC clarified that Yukon was not limited to recommendations it had previously proposed – it could make minor amendments based on changing circumstances – but it could not effectively propose a brand new plan. Implications The decision confirms that Yukon has the ultimate power to make decisions regarding the management of territorial lands. However, that power is not unfettered. The decision also reminds governments – and by extension resource developers relying on authorizations given by governments – that treaty rights contained in modern treaties are to be given a large and liberal interpretation that upholds the honour of the Crown. This includes commitments governments have made about processes for consideration of Indigenous interests in making land use decisions. The broader implications may be as follows: First, the decision emphasizes that reconciliation is achieved not only by negotiating modern treaties, but by implementing them. At one time, the conclusion of modern treaties alone was seen as a way for governments to achieve finality and certainty as to the extent of Indigenous rights and the scope of government responsibilities. Now, conclusion of treaties is

only one step in the process of reconciliation, which continues into treaty implementation. Second, while the SCC states that “reconciliation often demands judicial forbearance” and that “(i)n resolving disputes that arise under modern treaties, courts should generally leave space for the parties to govern together and to work out their differences,” at the same time “courts play a critical role in safeguarding the rights” that modern treaties, as constitutional documents, provide. Courts will still supervise Crown conduct in the implementation of modern treaties, and can strike down government decisions not consistent with the honour of the Crown. Third, for resource developers, the message remains that they must pay close attention to obligations arising under modern treaties that apply in areas where a project is proposed and should independently consider whether government regulatory decisions are being made in a manner that respects the terms of the treaties and the honour of the Crown. If proper processes are not being observed, then it is possible, as in this case, that the resulting decision may be quashed. CMJ TOBY KRUGER, KEITH BERGNER and JOHN OLYNYK are members of the Indigenous Law Group at Lawson Lundell LLP.

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FIRST NATIONS

Marijuana legalization must consider First Nations impacts By Isadore Day

n Dec. 12, the Chiefs of Ontario condemned the vote in the Ontario Legislature which gave Royal Assent to Bill 174: Cannabis, Smoke-Free Ontario and Road Safety Statute Law Amendment Act. Passing this bill so quickly has skipped the process of adequate engagement and consultation with First Nation communities, leaving communities with unanswered questions, insufficient preparedness, and inequitable distribution of provincial resources. Currently, First Nations are not prepared to deal with all the ramifications of the legalization of recreational cannabis. This is a critical issue that will have significant impacts for First Nations and with a lack of resources for First Nation specific research, First Nation communities in Ontario are not yet in a position to understand what these impacts will be. To reiterate our earlier call to the provincial government and the Standing Committee on Justice Policy, First Nations in Ontario were clear through collective resolutions that the provincial and federal governments should delay the legalization of cannabis in Canada and Ontario to allow First Nations the opportunity to prepare for implementation. This collective call has been effectively ignored by Ontario as Bill 174 has bulldozed through the legislative process. Debate on Bill 174 has been even more troubling. Following the Chiefs of Ontario submission to the Standing Committee on Justice Policy, the New Democratic Party tabled six motions which were intended to support culturally appropriate education and prevention programs for First Nations youth,

Big Greens is one of 28 privately owned cannabis dispensaries located at Tyendinaga First Nation (Mohawks of the Bay of Quinte). CREDIT: BRYAN HENDRY

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agreements with band councils for a share in the revenue of cannabis sales, and clear wording in the Act to ensure the respect of the inherent and treaty rights of First Nations peoples. Unfortunately, all but education and prevention programs were defeated. According to the debate records, resource revenue sharing was defeated without any real debate. Alternatively, the debate regarding respecting the inherent and treaty rights of First Nations peoples was rejected by the governing Liberals because: “…the governing law in Ontario (does) respect treaty rights, so this becomes redundant,” said Liberal MPP Arthur Potts. I am truly shocked, as we know this isn’t the case. If inherent and treaty rights were respected through law in Ontario, we would see prosperity in economics, resource revenue sharing and the health and well-being of our people. These, not coincidentally, are all of the areas that still have hanging unanswered questions for First Nation communities with the bulldozing of this legislation. There was not proper consultation, nor proper recognition of First Nation concerns in the passage of this legislation. This is extremely disappointing given the fact that our chiefs met with the premier and cabinet in November and held speciﬁc sessions on cannabis, and these concerns have been effectively ignored. Between now and July 1, 2018, First Nations must be fully engaged and involved in all aspects in the legalization of cannabis, and the monumental societal and economic shifts it will bring. CMJ ISADORE DAY Wiindawtegowinini, is Assembly of First Nations Ontario Regional Chief.

www.canadianminingjournal.com

2018-01-02 4:05 PM

FAST NEWS • Technology |

Updates from across the mining ecosytem

Cat and FTP partner to boost mine network performance

aterpillar and FTP Solutions have developed a co-operative agreement to deliver proactive monitoring and management of mining technology applications and the networks that these products depend on. FTP Solutions, based in Perth, Western Australia, currently offers products and services for monitoring and supporting site communications. The collaborative work will make best use of the proprietary technology developed by each company to deliver best-inclass site solutions for mining customers. The integrated solutions will be offered as part of Cat’s MineStar system. “Through this partnership, Caterpillar and FTP Solutions are instituting means to enable mines to move close to enterprise network availability in their operational technology,” said Sean McGinnis, product manager within Caterpillar’s mining technology group. “When Cat MineStar products are installed with FTP Solutions’ integrated management system, the mining operation has full vision of ofﬁce and mobile applications across their manual and automated MineStar sites. This insight provides the means to enhance network availability.” “The partnership enables us to create a single operational view to provide the most reliable critical networking environment possible,” said Lachlan McMahon, managing director of FTP Solutions. “Providing this type of data transparency in real-time across an operational site will

• Tunneling |

Caterpillar’s 793F autonomous truck. CREDIT: CATERPILLAR

also deliver business beneﬁts beyond existing support functions.” In practice, Caterpillar and FTP Solutions have been working together to optimize wireless networks at mine sites running Cat Command, a capability set within Cat MineStar system, and will now apply these solutions to the networks installed at sites running other MineStar applications – fleet, terrain and detect. The effectiveness of the monitoring system and the collaborative effort is expected to deliver an improvement in the effort required to manage and maintain site networks. The sum of the efﬁciencies gained are expected to lower cost per tonne. Caterpillar and FTP Solutions started offering their joint services in Australia in

2017 and are expanding to all mining regions in 2018. In other Caterpillar news, the company has signed an agreement with Rio Tinto to retrofit 19 Cat 793F mining trucks for autonomous operation at the Marandoo iron ore mine in Western Australia. Caterpillar will also install Cat Command for hauling software for operation of the autonomous fleet. The result of the agreement will be the first fleet of Cat autonomous trucks deployed by Rio Tinto. The first few trucks will be retrofitted in mid-2018, and the project will be completed by the end of 2019. Both Caterpillar and regional Cat dealer WesTrac will play ongoing roles in managing and supporting the autonomous haulage system.

Golder buys Alan Auld Group

older Associates, a leading global engineering and consulting company, has purchased the assets and ongoing operations of the Alan Auld Group of Companies. Headquartered in Doncaster, U.K., with ofﬁces in the United Kingdom, Canada and the United States, Alan Auld is a global provider of specialized engineering design and construction services for underground structures and is recognized for their expertise in deep shafts and tunnels. “Like Golder, the Alan Auld Group has built a strong reputation for developing practical solutions to complex challenges,” JANUARY 2018

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said Hisham Mahmoud, Golder CEO. “The group’s skills and resources are highly complementary to ours and will allow us to expand our leadership position and offer greater expertise to our clients globally.” The Alan Auld Group had its beginnings serving the mining sector in the design of mine shafts and has been involved in the design of many of the complex mine shafts sunk around the world in the past 20 years. The Group also provides tunnel and shaft design, rehabilitation and project management services for the power, water and transportation markets. CONTINUED ON PAGE 10

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FAST NEWS • Equipment |

Updates from across the mining ecosytem

Finning secures contract for Lundin’s Candelaria

inning International has been partnership with Lundin Mining awarded a multi-year mining at Candelaria. Our focus is to supcontract by Lundin Mining to port Lundin in its efforts to operate deliver new equipment and product efficiently and cost effectively, support to the Candelaria copper while improving productivity,” said mining complex in the Atacama Marcello Marchese, president, region of northern Chile. Finning South America. “We Finning will supply nearly 70 remain constructive on the long pieces of new Caterpillar large term outlook for copper. This is mining equipment valued at the first significant order for minapproximately US$185 million to ing equipment that Finning has the Candelaria open pit and undersecured in Chile since the indusground mines, as well as support The plant at Lundin Mining’s Candelaria mine, in Chile. CREDIT: LUNDIN MINING try’s decline in 2014. As activity in the entire fleet under a maintethe mining sector begins to nance contract. The fleet will improve, we are well positioned to include hydraulic shovels, off-highway be delivered over the next three years. capture equipment and product support trucks, and auxiliary equipment, and will “We are pleased to build on our strong opportunities,” he concluded.

• Trucks |

Hitachi, Wenco complete successful autonomous haulage tests

enco International Mining Systems has announced the completion of trials of Hitachi Construction Machinery’s autonomous mine haul trucking program, developed in conjunction with Wencomine dynamic dispatch fleet management software. Hitachi purchased Wenco in 2009, and has been working closely with Wenco to leverage the Dynamic Dispatch fleet dispatch automation software to enable dispatch of autonomous haul trucks. In November, Australia Mining Monthly reported successful testing of three self-driving Hitachi EH-5000 haul trucks at Stanwell Corp.’s Meandu coal mine in Queensland, Australia. “We’re very excited to reach this milestone,” says Louis Chan, Wenco’s manager of research and development on the project. “Wenco has worked closely with Hitachi since 2014. Completion of this test phase proves capability of managing fully autonomous vehicles from fleet management and fleet automation software. We’re now eager to move ahead to the next phase – trials in active mine operations.” Stanwell’s 2015-16 annual report noted that autonomous haul trucks have moved upwards of 300,000 billion cubic metres of earth in mine rehabilitation work. The company is now in discussions with Hitachi around extending the trial through 2019.

Hitachi’s EH-5000 haul truck. CREDIT: HITACHI

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Atlas Copco’s hydraulic tools to be part of Epiroc

• Spin-out |

s of Jan. 1, the hydraulic attachment tools division within Atlas Copco became part of Epiroc, the company that Atlas Copco plans to dividend out in mid-2018. The division manufactures excavator attachment tools such as hydraulic breakers, cutters, pulverizers, bucket crushers, shears, grapples and magnets. The division’s current products will also now be delivered with Epiroc product branding. The hydraulic attachment tools division has been a technology leader for more than 50 years. The product range today includes 100 different hydraulic attachment tools, and is designed to ensure that customers can always find the right tool for their specific application and excavator. After shareholders´ approval, in 2018, Atlas Copco will become two separate global groups of companies: Atlas Copco, focused on industrial customers, and Epiroc, focused on mining, infrastructure and natural resources equipment. www.canadianminingjournal.com

2018-01-02 4:06 PM

CAMA celebrates

Q&A

25 YEARS The Ring of Fire panel at CAMA’s 25th annual conference in November. CREDIT: STAN WESLEY

he Canadian Aboriginal Minerals Association was formed in 1992 to give voice to community concerns around mining, and to bring the two parties together. In fact, CAMA cofounder and president Hans Matthews – who is also a geologist with experience in exploration and mining – describes the organization as providing the services of both a “dating game and marriage counsellor.” Hans Matthews While there’s been a lot of progress in the relationship between the mining sector and the Aboriginal community over the past 25 years, with the number of agreements, including IBAs, growing to over 400 from only six, and greater understanding of each other’s objectives on both sides, there’s still a ways to go in the evolving relationship. Community concerns around water and the environment are increasingly overshadowing the economic benefits that mining can bring – as reflected in CAMA’s recent conference in Toronto. CMJ spoke to Matthews in late November about this and other trends.

theme of this year’s conference was water – why did CMJ: The you choose that theme? When we meet with Hans Matthews: mining companies and communities, the key focus of the communities’ concerns are

about water. I think the days when people were screaming for jobs, jobs, jobs, that’s taking a second or third seat down compared to what communities are desiring today, which is prudent or effective environmental management. Also from last year’s conference, a lot of youth and elders were saying we have to protect the water because we all need it whether we’re a mining company or an Aboriginal group. We try to differentiate ourselves from other mining associations because we’re not trying to advocate for the mining industry, we’re focusing on sideline issues that few want to address head on like water, or social and mental health in a community. You won’t find a mining conference where they have elders who have been through residential school and they want to share their story. So it’s educational for mining companies to be exposed to all of these other facets in community life. It helps the company understand how to move forward. CONTINUED ON PAGE 12

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CANADIAN MINING JOURNAL |

2018-01-02 3:23 PM

I think that the mining industry is talking about water CMJ: more, they do recognize its importance to communities, I think – so do you see some common ground there, potentially? I think there’s a transition occurring in the mining HM: industry where there’s a big group who still go by the philosophy of solution by dilution: to get rid of effluent from a tailings pond or a mine, some companies will do the bare minimum treatment and flush it out into the environment to mix with existing rivers and lakes. We’re trying to avoid that.

So there’s part of the industry that still has that CMJ: attitude and then there’s another part of the industry that’s more progressive? I think we’re reaching a point where companies are HM: getting more committed to being innovative in environmental management. The next push will come when they

actually involve the aboriginal community in that discussion. We’re at a stage right now where aboriginal communities in some regards are still considered checkboxes on the way to get the permits and government approval, whereas it should be the other way around where the companies should be working with communities to develop plans jointly and gain the approval of the community. The approval of the federal and provincial governments should be secondary.

How do mining companies respond to the idea of CMJ: having Aboriginal communities more integral in closure planning and environmental assessments?

HM:

I think they’re skeptical because they’ve always hired some of the larger environmental firms in the hopes that if a major, multinational firm rubber stamps their own work and submits it to the government that it should be a cake walk – we can check that off the box and then we can go ahead. To many companies, the limit of aboriginal involvement is with traditional ecological knowledge – to include that in the environmental assessment. It’s unfortunate, but it’s still a checkbox approach. To give you an example, when a sacred site is found, some companies will just say ok, we won’t do any devel-

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opment within 100 metres of it. So it’s not put in the context of respect – the community wants to protect the site, it’s not just about a numerical outline. The other big area is when companies hire major consulting firms for their EAs, often the consultant or the group takes an arbitrary circle or a linear approach to outlining the areas that will be affected by a mineral development. But what communities are saying is no, no, it has to be the watershed, it has to be all of the water that’s going to be affected, that has to be included in the study. So there’s a debate because obviously depending on the size of the watershed, it can actually cost a company significantly more for a broader scoped study than say 1 km around the mineral project or development. So there’s still conflict on how environmental management and assessment proceed, and the reason why there’s that conflict is because there’s still a misunderstanding in terms of the significance of the land. To mining companies, the significance of the land is their acreage for the tailings management area, their waste rock piles, their mill buildings, roads and so on. But to a community, the land is more important, it’s the interconnectedness of the plants, the animals, the water, the air, the soil and how these things interact to provide life and support the communities. Especially those in the northern or remote parts of Canada who depend more heavily on subsistence. You mentioned at the conference that there’s been a lot CMJ: of progress between the mining industry and Aboriginal communities in Canada, but what’s the most urgent issue now, what’s the next area where there needs to be progress?

There’s still an outstanding issue of unfinished busiHM: ness. Basically, the agreements that were struck 100 plus years ago – the treaties – have been misinterpreted or

ignored by governments in terms of approving and moving forward with mineral projects. And this will come back and bite the Crown for not complying with the spirit and intent of a treaty. The main thrust of a treaty is the doctrine of sharing and there’s a high-profile case that’s ongoing today called the Robinson-Huron Treaty Annuity claim: since the late 1800s, 21 First Nations (in Ontario) have not received a share of mining and resource revenue even though the commitment is written in www.canadianminingjournal.com

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Opposite: The conference heard from several panels over three days covering youth perspectives, legal issues, water and reconciliation. CREDIT: STAN WESLEY Above: (Left) A panel discusses how the mining sector can contribute to reconciliation. (Right) A Matawa First Nations display in the Trade Show. CREDIT: STAN WESLEY

the treaty. That’s just one example. Another issue is areas where there are no treaties, where governments and communities and industry are wrapping their heads around “how do we move forward with approvals for projects when there’s no agreement with the Crown.” But the big area that I think we’re going to be focusing on that I mentioned earlier is that one day there will be an Aboriginal-driven environmental assessment process, where the communities will oversee the process instead of being third-tier reviewers after everything is written in an extensive half-metre thick document that the government requires them to review it in 45 days. The other one that’s becoming very popular is revenue sharing, whether it be revenue from taxes – and this relates also to the Robinson Huron treaty – whether there’s going to be a share of revenues received by the government from mining. And the other one is revenue sharing directly from mining companies which in some respects is already occurring with some communities.

CMJ:

At the CAMA conference, you also mentioned an interesting cultural difference or difference in philosophy that affects the relationship between Aboriginal communities and mining companies. You made the observation that corporate decisions are made on a top-down basis while aboriginal communities use a bottom up approach. So how can the two parties bridge that gap?

Our view is that community leadHM: ership plays a significant role in being the spokesperson for the commu-

nity. But more significantly leadership often excels in facilitating – bring the community

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together to discuss important issues and to reach consensus and to make decisions affecting the community. Community leadership has in many cases helped the community ﬁnd out more about a mineral project or participate in decisions regarding a project. The other thing is we respect leader-to-leader communication, but negotiations should be community driven, not driven by leadership. One of the biggest complaints we’ve received

CONTINUED ON PAGE 14

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from the mining industry is, “We sent them a letter and it took them two, three months to respond to it.” The reason why was the leader who they wrote to had to consult with his council, and the council had to take it to the community if it was a significant issue. So depending on the size of the community, if it’s a couple hundred vs. 30,000 and depending on the magnitude of the issue, it could take a long time to come up with a decision. Community leadership rarely make decisions on their own without consulting their community membership or other people who are affected by the project.

The youth panel participants share their perspectives on mining. CREDIT: STAN WESLEY

CMJ:

So companies are expecting that communities are structured and work the same way that a company works when that’s not the case?

That’s right – it’s a total illusion. In the early days of HM: CAMA many from industry used to think, “Well we can take the chief out for a nice dinner and we’ll get the buy in and we’ll check that off the box – met with chief, he supports the project – ok, let’s go. And then all the shovels are in the ground and everything’s going and all of a sudden there’s a blockade. So to do it properly is the most effective way and if you’re a mining company executive and you depend solely on consultation with the chief, your investment is at risk. A key structure to follow is leader to leader, manager to manager and staff to staff dialogue with all three levels acting at same time.

reasons or drivers for why they should work with Aboriginal communities near their projects. Some other policies allude to creating wealth rather than respecting the community’s connection to the land. Some say that: “We recognize that Aboriginal people are disadvantaged, therefore, we’re going to work with them to improve their lives.” There’s a big difference there.

CMJ: It sounds like communication is the key. Definitely communication, but also it’s a paradigm HM: where in the past mining companies never had to deal with anyone other than the federal and provincial government. That’s where they got their blessing, but nowadays, that’s not the blessing that you need. The blessing that you need is with the Aboriginal community.

What else would you advise from the mining company Have you seen examples of companies doing it well? CMJ: side, or is it just the understanding of how a community CMJ: actually works? Some of them are doing well locally. The global comThe first thing I suggest to mining companies is be HM: panies have pockets of success but it’s unfortunate that HM: open and be explicit that you are committed to having it’s not uniform because it’s going to come back to haunt them. a relationship, however that might be, with the local communities. Placer Dome had a policy that said, “We recognize that our projects are on Aboriginal lands, therefore we believe that we have to involve and be involved with the community,” etc. That was unheard of. There are other companies who have other

I’m getting communities saying did you hear about that spill over in Brazil or elsewhere by that company, the same one that wants to deal with us? So with the internet, communities can find out everything about a mining company in minutes.

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When you look back on the last CMJ: 25 years, what are you most proud of accomplishing through CAMA?

see that we’ve set sort of the stage for them to interact and try to accomplish something to their mutual benefit. We don’t measure our success in dollars and cents, we measure our success in how many people are working together. Through our events we are nurturing Aboriginal community and mining company relationships…successful dating! CMJ www.canadianminingjournal.com

2018-01-02 3:23 PM

First Nations & Mining

NATION-TO-NATION

as equals

Federal commitment to Indigenous people ushers in change By Marilyn Scales

he Canadian government has met several times with Indigenous leaders in the past year to establish what it calls a Nation-to-Nation dialog aimed at closing the gap between our First Nations, Inuit and Metis and the socio-economic benefits of the Twenty-first Century enjoyed by other Canadians. What do Canada’s Indigenous people want? The same rights enjoyed by the rest of Canada: control over land ownership, their government and laws, their languages, the education and well-being of their children, and the opportunity to participate in the resource economies. The process of reaching those goals may be complicated, but it begins with genuine respect for our Aboriginal population. Respect was evident at the Nation-

to-Nation meeting in Ottawa at the end of November. Delegates listened to chiefs from across Canada, politicians, former Prime Ministers, businessmen, and activist youth. Their views may have differed slightly on the details, but to a person they are committed to closing the socio-economic gaps that have arisen over the past 150 years. CMJ is taking a look at the main themes addressed and how change will take place. A proud history, a shameful failing Native Canadians have a long and proud history – far longer than the 500 years that Europeans have trod the land. Indigenous culture is anchored in an oral tradition that addresses all aspects of creation, life and death. Their view of the world is no less valid than a European religious one.

“We want to share our stories, our culture,” said Natan Obed, president of Inuit Tapiriit Kantami. “Then we can respect each other in a new and complete way. We want to build this country with you. There is a place for all of us.” The earliest treaties were based on sharing the land and its resources, and many in the native community would like to see a return to those values. The First Nations were marginalized by the Indian Act of 1876, or as Chief Wayne Christian of the Shuswap Nation Tribal Council called it “the most racist piece of legislation in the world. It’s crap.” Native peoples have endured the extinguishment of their rights, and the kidnapping – if that is not too strong a word – of their children who were forced in to residential schools where they were CONTINUED ON PAGE 16

1: Michael Ferguson, auditor general of Canada. 2: Natan Obed, president, Inuit Tapiriit Kanatami. 3: Isadore Day, regional chief, Chiefs of Ontario. 4: Former prime minister Joe Clark. 5: Former Ontario premier Bob Rae. 6: Miles Richardson, National Consortium for Indigenous Economic Development. 7: Murray Sinclair, senator for Manitoba. 8: David Zimmer, Ontario minister for Indigenous Relations and Reconciliation. CREDIT: INSTITUTE ON GOVERNANCE JANUARY 2018

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abused and their languages forbidden. Notably, the Indian Act does not cover the Inuit and Metis or the First Nations in regions that were not yet part of Canada, i.e. British Columbia. Nor have their rights been restored by the British North America Act of 1931, or the Constitution Act of 1982, the Charter or Rights and Freedoms, or the Meech Lake and Charlottetown accords. Thanks in part to the Truth and Reconciliation Commission (TRC), we are all on a healing journey said National Chief Perry Bellegarde. It may not be perfect, but most Indigenous people see its recommendations as signposts to a better way forward. Treaties must not be considered as final, but as living documents that change as the world changes yet honour their underlying principles. Self-determination not optional The bottom line for Indigenous peoples is self-determination. They want to be participants, not recipients. This desire underpins so many Indigenous court cases that demand this right. And the Aboriginal arguments are most often the winning arguments. Before that happens, native Canadians will have to define their own nationhood. As things stand now, there are three “nations” – Inuit, Metis and First Nations. That definition is too narrow. It might be too broad if every one of the 600+ bands is a separate nation. Or the definition might be somewhere in between, but it is a question that can only be solved by the Indigenous community. No interference 16 | CANADIAN

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Indigenous lives can no longer be treated as a line item in a budget. –ISADORE DAY, ASSEMBLY OF FIRST NATIONS (AFN) ONTARIO REGIONAL CHIEF

from outside is appropriate. Amazingly, for all the harm European colonization has done to the native North American population, they remain firm in their determination to share the wealth. This sentiment was expressed repeatedly and sincerely. The mining industry would do well to accept the Indigenous desire to be partners in the resource sector. A new fiscal relationship needed Establishing self-determination will take money – a great deal of money. This calls for a new fiscal relationship with the current government, and it must be created if a true Nation-to-Nation rapport is to be built. By off-loading the responsibility for health, education, housing and social welfare onto the provinces, the federal government opened the door to chronic underfunding of all these important programs. This is a responsibility some would like the federal government to take back. “If the Charlottetown Accord had

passed the socio-economic gap would have been closed by now,” said Isadore Day, Assembly of First Nations (AFN) Ontario Regional Chief. He reminded his listeners that equalization payments are not available to Indigenous people as they are to the provinces and territories. Perhaps they should be. “Indigenous lives can no longer be treated as a line item in a budget,” he declared. Indigenous people know that each community needs a dependable revenue stream. Ideally revenue would flow from being equal partners in resource development and economic participation. Otherwise, or perhaps for an interim period, money would have to be provided from the federal coffers. Or shared by the federal and provincial governments. In the words of former Ontario Premier and federal Cabinet Minister Bob Rae, “There has to be a multi-billion-dollar commitment from both the feds and provinces.” Rights must be enshrined in law It is generally acknowledged that the rights of Indigenous people must be enshrined in law. The Trudeau government has said it wants to make sure whatever law covers those rights cannot be overturned should the Liberals lose control of Parliament. They have even www.canadianminingjournal.com

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Opposite Left: Charles Coffee and Ovide Mercredi examine the way forward. Top right: Natan Obed, Chief Perry Bellegard and Clement Chartier discuss the Indigenous perspective. Bottom right: The youth panel, chaired by former prime minister Paul Martin, included Riley Yesno, Andre Bear and Gabrielle Fayant. CREDIT: INSTITUTE ON GOVERNANCE

floated the idea of the Royal Proclamation to enshrine those rights. Many Indigenous leaders insist that Indigenous peoples be recognized as founders of this country, equal to the French and English. Former AFN National Chief Ovide Mercredi believes a constitutional mandate is needed to entrench Indigenous rights, “or the mistakes of the last 150 years will be repeated.” He also had words for Justin Trudeau: “I say to the current Prime Minister finish what your father started.” Celeste Haldane, chief commissioner of the B.C. Treaty Commission, wants to see the recommendations of the TRC put into actions now. “The TRC actions don’t need to wait for a new Royal Proclamation. Do provinces have a role? Whether or not provinces and territories have a role in negotiating self-determination for Indigenous nations is debatable. Most native leaders want to see sole responsibility rest with the federal gov-

ernment. It was with them that all treaties have been negotiated, then broken. And dealing with a single administration would be preferable to adding another 13 seats to the table. Those same leaders acknowledge that federal and provincial-territorial interests do not often align. Nor can Indigenous self-determination be put to a referendum. As an example, the leaders point toward the failed Meech Lake Accord that was quashed when Manitoba and Newfoundland refused to ratify the document. Most often it is the non-Indigenous segment of society that expresses an interest in having the provinces at the table. One of the strongest proponents is former Ontario Premier and federal Cabinet Minister Bob Rae. He expects both the federal and provincial governments to support Indigenous self-determination by supplying the not inconsiderable billions of dollars it will take to bring about real change. Former Chief Justice of the Supreme Court Frank Iacobucci also favours including the provinces in negotiations. He believes it would be possible to make a federal-provincial proclamation on Indigenous rights and skip the “royal” aspect. “But that’s just my personal opinion,” he added. “Including the provinces is a recipe for disaster,” said Manitoba Senator and chief commissioner of the TRC Murray Sinclair. “Let the feds consult with the provinces and the Indigenous community with the federal government. This is about righting a relationship we want to keep.”

The way forward So much Euro-centric lawmaking has left the relationship between the Government of Canada and its Indigenous peoples at a tipping point. Whether that relationship teeters along, races forward with a new sense of equality, or slides backwards to make again the mistakes of the past 150 years remains to be seen. The Minister of Indigenous Relations and Northern Affairs Carolyn Bennett told the Nation-to-Nation gathering that Indigenous peoples have the support of the Liberal government. She pledged to assist the Inuit with their land claims, support the Metis population, and get the First Nations out from under the Indian Act. There is much to do to close the socio-economic gap that exists between natives and the rest of the country. As Bob Rae added, “We have underestimated the size of the challenge before us and the length of the journey.” But the Liberal government remains determined to make amends rather than merely apologize. “We have talked for too long,” said Hon. Jane Philpott, Minister of Indigenous Services. “Let’s be the people who get things done!” CMJ

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Including the provinces is a recipe for disaster. Let the feds consult with the provinces and the Indigenous community with the federal government. This is about righting a relationship we want to keep. –MURRAY SINCLAIR , MANITOBA SENATOR AND CHIEF COMMISSIONER OF THE TRC. JANUARY 2018

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ADVERTORIAL

African experience lines up BME for Canadian challenges

“There is also a commonality of the customers themselves – where many companies own mines in Canada as well as in African countries. This has led inevitably to a positive crosspollination of ideas between markets.”

hile there is much that differentiates Canada from the continent of Africa, there are a remarkable number of similarities relating to the environment in which mining takes place, according to Joe Keenan, managing director of the South Africa-based explosives leader BME. Having established itself over the past 30 years as the largest provider of explosives and blasting services to South Africa’s opencast mining sector, BME has also established a wide footprint in 19 other African countries. The company has recently entered the Australasian and South American markets, and Canada has now also been prioritised as a market of interest. “From a geographic and demographic point of view, there are interesting parallels between the conditions under which we operate in Africa, and those that exist around Canada,” said Keenan. “One of the most obvious is the concentration of African populations in a limited number of large, urban areas – much like Canada – while the mining areas are generally remote and rural, creating similar challenges for logistics and communication.” Himself a native of the land of the maple leaf, Keenan said that Canada – as the world’s second largest country – had considerable diversity in the source of its mining skills, many coming from African countries. “Canada prides itself on being a multi-cultural nation, and has built its mining industry on the skills of a range of countries and cultures – including many from Africa’s mining centres such as South Africa and Ghana,” he said. It is also interesting to note that, as a continent, Africa currently rates highly alongside Canada as among the world’s the more popular exploration destinations. Indeed, Canada is probably the largest investor in Africa’s minerals sector, with a great deal of focus on both exploration and mining by Canada-based companies – ahead even of China’s considerable mineral investments in the continent. “The explosives markets in Africa share with Canada a focus on product differentiation, productivity and service,” he said.

Joseph Keenan, Managing Director, BME

From a technology point of view, there is considerable cross-over in terms of technologies used and mining methods – including long-hole stoping, room-andpillar, narrow vein mining and deep underground mining.

“The mining sector on the continent of Africa share a number of technologies and experience around deep mining methods and the challenges that these pose,” he said. “There is also a great diversity of commodities in both regions, with Canada exploiting many of the minerals found in African countries – from gold, diamonds and coal to copper, cobalt, uranium and iron ore – where they are mined by both opencast and underground methods.” He noted that African countries share with Canada the common predominant usage of bulk emulsion explosives – the core of BME’s product offerings – and these markets have all seen a high conversion to electronic detonators as part of their production regime. “In the underground space, there has been a push within the Canadian market to convert mining development and stoping to bulk explosives, to replace bagged Anfo and cartridges for both regulatory and productivity reasons,” said Keenan. He said that growing concerns over the issue of nitrates in groundwater, for instance, have led to mining companies moving to emulsion options in which the nitrates in the explosives are not water-soluble. In fact, many of the mining regulations in place on the South African law books were

About BME – www.bme.co.za: BME is the leading supplier of explosives and services to the African mining, quarrying and construction industries. Focusing on safety, supply security and value adding technical services, BME strives to remain at the forefront of technology by regularly participating in the research and trials of new blasting techniques and products, as well as attending and presenting at technical conferences worldwide. BME has operations in over 23 countries including Australia, Singapore, Indonesia, Columbia, and 14 countries in Africa.

18 | CANADIAN MINING JOURNAL

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www.canadianminingjournal.com

2018-01-02 4:08 PM

Experience, footprint and capacity of BME on the African continent means the company is well placed to serve the mining markets of Canada’?

The mining sector on the continent of Africa share a number of technologies and experience around deep mining methods and the challenges that these pose. There is also a great diversity of commodities in both regions, with Canada exploiting many of the minerals found in African countries – from gold, diamonds and coal to copper, cobalt, uranium and iron ore – where they are mined by both opencast and underground methods. – JOE KEENAN, MANAGING DIRECTOR OF THE SOUTH AFRICA-BASED EXPLOSIVES LEADER BME

BME’s emulsion explosives help keep nitrates out of mine water

informed by those in Canada – from where much inspiration was drawn in the 1990s and later that would guide South Africa’s policy frameworks.

supply chain, to ensure that operations are not disrupted by lack of supply – irrespective of the challenges posed by distance or infrastructure.

He added that customers in African countries and in Canada tended to have similar expectations of their explosives providers, looking to them for an extensive range of services; the two high-level services – rock-on-ground and down-thehole services – are quite comparable between these markets.

“The way that mines make use of contractors is also quite similar between these markets – with mines often outsourcing mine construction and development work to contractors, while conducting in-house the core and critical activities like ongoing blasting and mining,” he said.

Hand-in-hand with this is the advanced technical support that explosives companies are able to provide to their customers, to enhance the utilisation of their products. At the same time, customers place high priority on the security of the explosives

Keenan argued the experience, footprint and capacity of BME on the African continent meant that the company was well placed to serve the mining markets of Canada, and that its opportunities for doing so were not far off. n

JANUARY 2018

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www.canadianminingjournal.com

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Image: powerofforever – istockimages.com

BC & the North

What’s in store for BC miners BY DAVID DUVAL

New government just one element of a complex mining landscape

JANUARY 2018

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ritish Columbia’s mining industry faces an uncertain future following the election in July of an NDP government whose very survival depends upon three electoral seats held by the BC Green Party lead by University of Victoria climate scientist, Andrew Weaver. In addition, the industry faces heavy scrutiny from well-funded special interest groups, many of which are aligned with First Nations bands seeking resolution of longstanding land claims issues. Tarnished by a catastrophic and visually disturbing tailings dam failure at the Mount Polley copper mine in central B.C., the industry also faces increased environmental and regulatory scrutiny. The province’s mining industry has a checkered history with the NDP, the worst period having occurred during the premiership of Dave Barrett from 197275 when the NDP imposed stiff mineral royalties on commercial metals production. While history doesn’t always repeat itself – but often rhymes – the post royalty experience of the Barrett government, which included a well-ﬁnanced anti-NDP public relations program sponsored by B.C.’s mining industry that helped defeat his government, suggests the NDP today will move closer to the centre ideologically rather than adopt extreme policies of the past. Premier John Horgan has promised to

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Top: B.C. Premier John Horgan and his new cabinet are sworn in on July 18, 2017. Bottom: Premier Horgan, Environment Minister George Heyman and Energy Minister Michelle Mungall at the Site C announcement. CREDIT: GOVERNMENT OF B.C.

support pro-mining policies including the flow-through share tax credit and the exploration tax credit. In addition, he said his government would maintain support for Geoscience BC, removing the PST from electricity used in mining, enhancing the Environmental Assessment process, ensuring Mines Act permits are processed quickly and investing in mining-related training programs like the training tax credit. As part of her government mandate, B.C.’s Minister of Energy, Mines, and Petroleum Resources, Michelle Mungall, has thus far been tasked with establishing a BC Mining Jobs Task Force to create and sustain good jobs, developing an improved and properly resourced approvals process to assess mining applications, and establishing an independent oversight unit to increase industry safety

which is already among the safest in B.C. The minister failed to respond to speciﬁc questions concerning her mandate. What’s in store for B.C. mining might well mirror the outcome of resistance to mega projects in the province, including the federally approved Kinder Morgan pipeline and the $10-billion Site C power dam project of BC Hydro. Premier Horgan recently approved the completion of Site C, noting that its cancellation would have resulted in a writeoff of almost $4 billion in past expenditures and related termination costs. At the same time, the government recently declined to issue an environmental permit for KGHM International’s Ajax project near Kamloops, citing air quality concerns and the spiritual significance to First Nations of a lake and land surrounding the mine. Perhaps reflecting a new political www.canadianminingjournal.com

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We are pleased that Premier Horgan has acknowledged the importance of these contributions and conﬁrmed that his government will do its part to enable and facilitate ongoing successful exploration and development. – EDIE THOME, CEO ASSOCIATION FOR MINERAL EXPLORATION

pragmatism, Rachel Notley’s NDP in Alberta aggressively supports Kinder Morgan’s Trans Mountain pipeline that terminates near Vancouver, along with the Keystone pipeline project to the U.S. gulf coast. Professor George Hoberg, who teaches environmental and natural resource policy at UBC, suspects that Notley’s strategy is to “reach the political middle in B.C.” because “that audience is critical to how responsive the (B.C.) NDP government is likely to be to pipeline opponents.” Whatever the result of Notley’s strategy, the jury is still out as to whether B.C.’s NDP government will target the same demographic in its decision making process. Economic impact B.C.’s mining industry has a large impact on the provincial economy, accounting for $8.8 billion in gross mine revenues for 2016 as prices for some major metals either rose or stabilized. According to PricewaterhouseCoopers’ 2016 survey of British Columbia mining, total payments to government increased to $650 million in 2016 (the highest since 2011), up from $476 million in 2015. The report also showed an increase in direct jobs for survey participants to 9,329 from 9,221 in 2015. While difﬁcult to quantify, mining produces a multiplier effect whereby additional jobs are generated in service and related industries that are often greater than the employment created at the actual mine. The Mining Suppliers Association of BC boasts no less than 165 members who provide mines with a broad range of services and industrial products. JANUARY 2018

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Permitting process AME (Association for Mineral Exploration) BC’s newly minted CEO, Edie Thome, says the new government clearly recognizes the importance of policy decisions in maintaining a viable minerals industry. “Mineral exploration and development attracts tremendous investment and generates economic activity in B.C.,” said Thome. “We are pleased that Premier Horgan has acknowledged the importance of these contributions and confirmed that his government will do its part to enable and facilitate ongoing successful exploration and development.” One major issue AME BC will continue to track is land access. More specifically, Thome cites the Notice of Work Permitting Process as a significant bottleneck given the fact exploration in B.C. is generally seasonal and permitting delays can push work into the next exploration year. A seasoned business executive who previously worked as Director, Environmental Risk Management at BC Hydro, Thome describes B.C.’s regulatory system as “exceptional” by world standards but concedes there needs to be “more certainty” to the permitting process. “We’ve had very good access to government ministries who are very supportive of our interests so we are very encouraged by that,” she said. Land claims About two thirds of the Aboriginal population in British Columbia are thought to be engaged in the process of negotiating treaties with both levels of governments. The general aim of this process is to enable First Nations to govern their

own communities and build economies based upon rights to lands and resources in their traditional territories. British colonial policy recognized that Aboriginal tribes were sovereign nations whose title to the land was recognized by English law and international law. However, while treaties were negotiated throughout Canada and the United States in the eighteenth, nineteenth and early twentieth centuries, this was not the case in the territory that is now British Columbia. Contrary to international and British law (as well as Dominion Indian policy), the government of British Columbia took possession of most of its lands without entering into treaties with the owners of the lands. While First Nations opposition to large industrial projects including mining is nowhere close to being universal, some industry executives allege that vocal opposition from groups who clearly represent a minority of Indigenous Peoples is less based on the environmental and societal impact of speciﬁc projects but is rather a means of leveraging native land claims with both levels of government. CONTINUED ON PAGE 24

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2018-01-02 3:29 PM

Pretium Resources’ Brucejack gold mine, in northwestern B.C. CREDIT: PRETIUM RESOURCES

For First Nations communities in northern B.C. suffering the societal effects of poverty and lack of employment opportunities, the cancellation and/or delay of energy projects for which they have negotiated benefits agreements involving cash, jobs and business prospects has clearly been frustrating. Following the cancellation of the Petronas-backed Pacific NorthWest liquid natural gas (LNG) mega-project on the British Columbia coast, B.C. Liberal MLA, Ellis Ross, told the Financial Post: “For the first time, since white contact, we were ready to take our place in B.C. and Canada. Instead, B.C. is not going to exist pretty soon in terms of investment. That is how worried I am.” In addition, Ellis claims that “environmental activism has crushed the fur trade, seal hunt and natural resource extraction and left behind poverty, isolation and resentment.” Environmental groups Adding to the political uncertainty in B.C. today is opposition from mediasavvy environmental groups such as Greenpeace, the Sierra Club and Tides foundation who oppose just about any form of natural resource development including pipelines, new mines, hydroelectric power, liquid natural gas (LNG) and even coastal fish farming. Wealthy private donors in the United States are known to contribute to such groups, who are often closely allied with First Nations bands that have for decades been seeking resolution of historic land claims grievances from the provincial 24 | CANADIAN

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and federal governments. According to Vivian Krause, a Vancouver-based researcher and writer, the San Francisco-based Gordon and Betty Moore Foundation is the largest funder of environmental activism in British Columbia. It has granted more than $190 million to First Nations, environmental and other organizations working in B.C. By far, the top recipient of funds from the Moore Foundation is Tides Canada, which has been granted at least $70 million. Tides Canada spends that money internally and re-grants it to other groups, particularly First Nations organizations. Nonetheless, some Indigenous bands have benefited greatly from agreements concluded with resource companies. In 2014, Pretium Resources and B.C.’s Nisga’a Nation announced a comprehensive Cooperation and Benefits Agreement in respect to Pretium’s Brucejack gold project, located in northwestern B.C. The 2,700-tonne-per-day underground gold mine began commercial operation this past summer. “Nisga’a Nation strives for sustainable prosperity and self-reliance,” stated President H. Mitchell Stevens, “and the benefits from the Brucejack project will make an important contribution towards our improved quality of life. Our treaty brings certainty to this type of development and we look forward to working with Pretium.” In its 2016 annual survey of mining companies the Fraser Institute, a Vancouver-based conservative think tank

cited “uncertainty stemming from disputed land claims or regulation” as being among the top two greatest deterrents to investment – not just in BC but in all Canadian provinces and territories. “Both mining explorers and producers view policy uncertainty as a hindrance to investment. More speciﬁcally, in B.C., 72% of explorers indicate that uncertainty from disputed land claims deters investment, compared to 61% of producers. In addition, 49% of responding explorers and 36% of producers in B.C. indicate that uncertainty resulting from existing regulations deters them from investing in the province,” the survey noted. What B.C.’s mining industry spends on educating the public about mining’s contribution to the economy pales in comparison to the resources available to special interest groups who parley rare negative events such as the Mount Polley tailings dam failure in central B.C. into the category of irredeemable environmental disasters when in fact they are not. Incidents such as this are also subject to full remediation, albeit at considerable expense to those involved. The city of Victoria discharges 82 million litres of raw untreated sewage each day into the ocean surrounding the provincial capital which would be the equivalent of a Mount Polley tailings dam breach every 17 days. Unlike Victoria’s sewage, Mount Polley tailings are chemically inert and within three days of the failure water in nearby Quesnel Lake was CMJ deemed safe to drink. www.canadianminingjournal.com

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BC & THE NORTH

Western Copper & Gold’s Casino project in the Yukon. CREDIT: WESTERN COPPER & GOLD

Changing tailings management expectations shape Casino proposal

weighs large-scale mining By Alisha Hiyate

t may host only one active mine – Capstone Mining’s Minto copper operation – but Paul West-Sells, CEO of Western Copper & Gold, says the Yukon has a lot going for it as an emerging mining jurisdiction. It has settled land claims with most of the First Nations groups there and a more sophisticated roadmap on working with First Nations; it’s indisputably underexplored and mineral-rich, and it now has its ﬁrst major advancing a project through permitting – Goldcorp and its Coffee project south of Dawson. JANUARY 2018

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“I feel very, very positive about what’s happening up in the Yukon,” says West-Sells who has been working to advance Western Copper & Gold’s Casino project, in the southwest corner of the territory for a decade now. Another recent positive push for the Yukon was the announcement of federal funding in September for the Northern Resource Gateway project, which is aimed at improving access to the key, mineral-rich areas of the Dawson Range and Nahanni Range. Federal, territorial and industry commitments for the eight-year project total close to $500 million for road infrastructure. CONTINUED ON PAGE 26 CANADIAN MINING JOURNAL |

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Casino, located 150 km northwest of Carmacks, would beneﬁt from a government-funded upgrade of the road from Carmacks to about halfway to the project. The rest of the road to Casino would be 30% covered. While it won’t make a huge difference to the economics of the project, West-Sells says that the announcement represents a level of support for the projects that will beneﬁt from the infrastructure. “There are still agreements between the various levels of government and the First Nations governments that need to be made, but really it shows that everybody is in general agreement that the projects that will be impacted, with Casino being the biggest one, are projects that the various levels of government are comfortable with moving forward. It’s a huge endorsement,” he says. In the shadow of Mount Polley After a positive feasibility study was completed on Casino in early 2013 showing an after-tax net present value of $1.8 billion, internal rate of return of 20% and capital cost of $2.5 bil-

lion, the project entered the permitting phase in early 2014. Originally, the project was being reviewed at the executive committee level. However, in 2016, the Yukon Environmental and Socio-Economic Assessment Board (YESAB) moved Casino to a higher-level panel review. According to YESAB, a panel level review is established in cases where a project may have signiﬁcant adverse effects, are likely to cause signiﬁcant public concern, or involve the use of controversial technology. In the case of Casino, a large porphyry copper-gold deposit with a proposed 120,000 t/day operation and 22-year mine life, the biggest reason was heightened concerns about tailings management stemming from the 2014 tailings dam failure at Imperial Metals’ Mount Polley mine in B.C. “After Mount Polley, all tailings facilities and particularly conventional tailings storage facilities where there’s a dam and you’re storing the tailings behind that, were put under a lot of scrutiny,” West-Sells said. (YESAB was also concerned about the mine’s potential impacts on caribou, which the company has responded to by

There are still agreements between the various levels of government and the First Nations governments that need to be made, but really it shows that everybody is in general agreement that the projects that will be impacted, with Casino being the biggest one, are projects that the various levels of government are comfortable with moving forward. It’s a huge endorsement. – PAUL WEST-SELLS, CEO OF WESTERN COPPER & GOLD

Paul West-Sells, president and CEO of Western Copper & Gold. CREDIT: WESTERN COPPER & GOLD

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proposing a new location for its air strip that would leave more caribou habitat intact.) Casino would be the biggest mine ever built in the Yukon, and one of the biggest in Canada. And as a typical large, lowgrade porphyry, the open-pit mine would leave behind a lot of waste rock and tailings. (The deposit hosts proven and probable millable reserves, not including heap-leachable reserves, of 965 million tonnes grading 0.2% copper, 0.023% molybdenum, 0.24 g/t gold, and 1.74 g/t silver.) Its tailings pond, as envisioned in the 2013 feasibility study, would cover 11 sq. km and would be 286 metres high – one of the tallest tailings dams anywhere in the world. While the company, which is sensitive to concerns around tailings facilities, can’t do much to reduce the volume of waste at Casino, it can reduce the amount of water stored in the tailings facility West-Sells says. Two different processes are under way exploring how to do that. Since the Mount Polley failure, YESAB has followed the lead of B.C. regulators in adopting the requirement for a Best Available Tailings Technology (BATT) study for any projects that would produce tailings. Western Copper & Gold started its BATT study, which involves looking at the best combination of tailings technology and sites to host tailings facilities at the project, in mid-2017. The study, which should be complete by mid-2018, involves First Nations, all levels of government, regulators, and Western Copper’s technical team. West-Sells says the process will be successful if all parties can reach a consensus agreement on the best technology to use to deal with tailings and mine waste at Casino.

Changing expectations In addition to the BATT study, after Casino was moved to a panel review, Western Copper & Gold brought in an independent engineering review panel of top experts in the field to look at its tailings plans and make recommendations. While the panel said the original plan was fine, its members did make recommendations on how to reduce the amount of water stored in the tailings dam. “If you look at Mount Polley and what caused the failure – they talk about that unstable ground underneath the tailings dam, that’s where the failure happened, but really what was pushing that was the amount of water that was on top of that facility,” West-Sells says. “The process isn’t done, but what’s left in terms of the options are all options where there is significantly less stored water in the facility.” Only 20% of the tailings material will be potentially acid-generating, meaning they need to be covered with water to avoid oxidation and acid-mine drainage. West-Sells says the philosophy behind tailings dam design has changed drastically since Mount Polley. “You didn’t really consider what failure looked like and reducing the amount of water in case of a failure,” he says, explaining it was common to add extra water to ensure there would be enough to cover all the material. “When we went back and said “How much water do we actually need to have stored on the surface of the facility, the answer was almost zero. So, during closure, there’ll be no surface water and during operations there will be a minimal CONTINUED ON PAGE 28

Aerial view of the Casino deposit. CREDIT: WESTERN COPPER & GOLD

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amount of surface water required – it ends up being very, very little.” Although West-Sells said dry-stacking would be “unique” as a method at Casino, given the volume of tailings and waste, the types of waste materials and the project’s northern location, it is under consideration as an option. “If that ends up being the best technology and best way forward, then that’s what we’ll go with,” he said. Most of the documents Western Copper & Gold needs to submit for panel review were already completed at the executive committee level, but it still needs to complete its tailings studies and First Nations land use studies that have been requested. The project isn’t expected to see a yes/no recommendation by YESAB until early 2020. First Nations relationships The Casino project is located primarily within Selkirk First Nations traditional territory, but the company is consulting with ﬁve First Nations: three that will be impacted by infrastructure built on their traditional territory and two that could potentially be affected by downstream impacts of the mine. West-Sells says the relationships are positive and have been nurtured since the company ﬁrst acquired Casino in 2006. “We’ve been up there for 10 years – some of the First Nations, I’m meeting my third chief. That adds a lot to it, that we’ve been up there, that we’ve continued to work with the First Nations, continued to get their input, consult with them, bring them up to site – we just had the new chief of Selkirk First Nation up at site a couple of months ago.” Selkirk Chief Sharon Nelson declined to comment on the project, as the BATT review is still ongoing.

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Economics If Casino is ultimately approved, Western Copper & Gold’s next hurdle will be funding for the $2.5-billion project. The company recently hired M3 Engineering to determine if the economics outlined in Casino’s 2013 feasibilty are still valid today. The review, which falls short of a full updated technical report, found the economics to be very similar today, despite differences in metals prices, labour costs and other inputs, M3 found the economics to be very similar today. “Bringing those (updated numbers) in and using long-term commodity price forecasts from today – which are signiﬁcantly less than what we were using in 2013 – we ended up with almost exactly the same economic returns as were predicted in 2013,” West–Sells said. About 60% of Casino’s revenue would come from copper and 40% from gold. Western Copper would need a joint venture partner to help build the project. West-Sells expects a copper company will be best suited as a partner because gold companies are less comfortable with higher-capital projects – and have proven less adept at capital management. “I think where this is going to ﬁt comfortably is with a partner that’s a copper company,” West-Sells said. “If you look at the entire world of copper development projects that are out there, a project such as Casino, which has a capital cost of $2.5 billion, is a middle of the road capital cost project,” he added, citing the $6-billion cost of First Quantum Minerals’ Cobre Panama project. CMJ Casino’s senior environmental manager Mary Mioska, water sampling near Casino with a student from Yukon College. CREDIT: WESTERN COPPER & GOLD

www.canadianminingjournal.com

2018-01-02 3:44 PM

MINE CLOSURE

Why mine closure matters – and why it gets ignored By Alisha Hiyate

f you want to clear a room of miners, there are few better ways than to raise the topic of mine closure. At least, that’s sort of what happened at the Progressive Mine Forum in Toronto in late October. The inaugural event, organized by The Northern Miner, was dedicated to discussing innovation in mining. After a day of roundtables discussing CSR, Big Data in exploration, and innovation in mine development, operations and finance, about half the audience got up and left when it came time for the final topic of the day – mine closure. While mine closure may not be a sexy topic, it is an urgent one.

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“It’s the single most important thing that our industry does,” said Douglas Morrison, president and CEO of the Centre for Excellence in Mining Innovation. “Nobody in the public could care less what our productivity levels are, what the return on investment is. They absolutely care what we do with our waste streams – waste water and solid waste. This is where our industry interacts with the public.” In other words, if this is what the public is most interested in, mining companies should also be interested – if only out of self-preservation. How the industry deals with mine waste, CONTINUED ON PAGE 30

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including tailings, plays an enormous part in opposition to mining among regular Canadians. But this isn’t the only reason mine closure is so important. It’s a costly part of mining that far too many miners neglect. “The reality is when you look at mine closure in the overall life cycle of a mine, it’s actually the longest phase of a mine,” said Steven Woolfenden, director of environment for Iamgold. “I’m managing some legacy sites that are 30, 40, 50 years old and there is no end to that management – it will be in perpetuity.” The cost, Woolfenden added, is often underestimated. “Most people really don’t pay much attention to it because when you do the costing on 2 mine closure, it’s pushed so far out and discounted so much that it doesn’t really impact it. But when you get there, and you actually have a closed mine, it costs you a lot of money.” The roundtable, moderated by CMJ, looked at advances in mine closure and evolving best practices, and how to get the topic more top of mind in the industry. A new concept Ken Bocking, principal in the mine waste division at Golder Associates, pointed out that mine closure is acutally a pretty new concept. “I started (in mine closure) in 1992. Why? Because that’s when the law came in in Ontario,” Bocking said. “Until that time, basically mines would live out their useful life and then many of the operators just walked away.” Now, mine operators need to have a thought-out closure plan and put up financial assurance so that there is funding in place for closure if they do walk away. However, the industry hasn’t really implemented closure at many sites: “There’s not very many mines that have been completely closed to the point where the company can walk away and the land can be returned to the Crown,” Bocking noted. “So I think that’s where it needs to go next.” Waste management alteratives The current standard approach to tailings and waste management is sub-aqueous deposition – where tailings and waste are held in a tailings pond under water to prevent the sulphides in the material from reacting with oxygen in air and causing acid mine drainage. “It involves storing a large volume of water behind the dam,” Morrison said. “That’s also where all the risk is. If you didn’t have water behind the dam, and you had a breach of your containment system that unsaturated tail would actually go nowhere.” In the wake of the Mount Polley tailings dam breach in 2014, there have been calls for the mining industry to move to dry-stacking, which involves filtering the tailings and stacking them up like a landfill. However, it is very expensive to build and operate a filter plant and then to haul and place the tailings. “I think there will 30 | CANADIAN

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be places where because of special circumstances (dry-stacking is) justified, but it’s not going to be a general solution because of its cost,” Bocking said. Another alternative to sub-aqueous deposition is separation and sequestration. “The fact is 80% of the material in any metal mining tail is benign – it’s clay and other solid materials,” Morrison says. “We could depose of that 80% with very, very low-cost systems and that product could be laid out and we could actually be having alternative land use on that product very quickly.” Morrison noted that the current approach takes the 20% of problematic tailings and mixes them in with the 80% of benign material – making 100% of the waste problematic. At its old Doyon mine site in Quebec, where its new Westwood mine sits, Iamgold is looking at treating old mine waste. The company hopes to strip the sulphur out of the Doyon tailings so it can be reused at Westwood. Currently, Iamgold spends quite a bit of money to treat water at the site. The company is hoping to prove to regulators that the option is viable. If not, it will have to dig up other material to use. “If we can use our tailings, it’s probably about cost neutral, but it’s a much better, more sustainable practice in the long run,” Woolfenden says. In northern Ontario, the company is investigating the use of biosolids from the Ashbridge’s Bay sewage plant in Toronto as a growth medium for rehabilitation at its Chester mine. Progressive closure There are many advantages to progressive closure, the practice of conducting closure activities during operations. For example, if a particular tailings cell is no longer used, it can be closed out while others are still in operation. One advantage to progressive closure is the opportunity to practice and verify your closure technique, says Bocking. “There’s also financial advantages because the financial assurance that you put up, if you then progressively do some of that closure, you can claim some of that back so you’re liberating some of your financial assurance and putting it back in your pocket.” Progressive closure, which is made much easier if companies separate the benign tailings and waste from the reactive, Morrison noted, can also serve to reassure the public about responsible waste management practices in mining, because they don’t have to wait 50 years to see the result. Despite the advantages, progressive closure doesn’t seem to be on the radar for many executives and general managers. “One of the things we’ve been challenged with with regards to progressive reclamation is the question of why do it now, 1 and 3. The Progressive Mine Forum was held at the Carlu in Toronto in late October. 2. CMJ editor Alisha Hiyate. 4 and 5. The Mine Closure Roundtable featured: Ken Bocking of Golder Associates; Douglas Morrison of CEMI; and Steven Woolfenden of Iamgold. CREDIT: THE NORTHERN MINER

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why pay for it now vs. just kicking it down the road?” Woolfenden said. In order to make the case to decision makers, Woolfenden says KPIs (key performance indicators) need to be developed. “Most of them don’t seem to have KPIs with respect to progressive reclamation. They’re all on ounces produced, cost reductions, various other metrics,” he says. When the numbers are calculated, progressive reclamation really does save money over doing it all later. “When we look at the numbers in our ARO (asset retirement obligation) calculations and our LOM plannings, it does benefit the balance sheet when you can actually get these liabilities off of them,” Wolfenden said. “I’m not a finance guy but we used financial numbers to sell the argument (within Iamgold) and it worked.” Perhaps other companies are also becoming believers. Modelled on an Australian initiative, a number of majors and smaller companies have created a North American Mine Closure Group to collaborate on best practices, including progressive reclamation, Woolfenden noted. It’s also considered good practice for companies to incorporate the concept of design for closure earlier – in the development stage. Environmental monitoring As long as sites can’t be fully remediated, environmental monitoring is necessary. While in the past, a five-year monitoring period after closure was considered acceptable, that’s no longer the case, Bocking said. “The regulators and the industry are, I think, agreeing now that we need longer monitoring periods and more throrough monitoring.” A lot of monitoring equipment can now be automated, and drone and virtual reality technology can be used in some elements of monitoring and inspections. The industry should be making use of same technology being used on farms for autonomous monitoring, said Morrison. “When you look at the quality of data that farms produce and the precision with which they apply the various chemicals and the other things that they need to do vs. how we’ve continued to monitor our tailings facilities, we’re a long long way behind.” CEMI is working with a group at McMaster to commercialize a technique that can remotely monitor dissolved metals in water down to tiny concentrations, he added. In another example of new monitoring technology, Iamgold and other miners are working with the Biodiversity Institute at the University of Guelph to apply genomics to the environmental effects monitoring programs that are required during operations. Rather than send people into the field to take samples and deliver them to a lab that isn’t always accurate in testing, the companies can simplify the collection process at a fraction of the cost and time with a PCR (Polymerase Chain Reaction) machine onsite. “You can actually just take a water sample… and you will have the data as to what species are in that river and in what relative abundance,” Woolfenden said. CMJ CANADIAN MINING JOURNAL |

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CSR & MINING

IFC releases guidance on use of security forces By Michael Torrance

he spotlight is on security and human rights with the March 2, 2017 adoption of the Voluntary Principles on Security and Human Rights (the VPs) by the Mining Association of Canada (MAC) and with the Canadian government’s own endorsement of the VPs in 2009. So it is timely that the International Finance Corp.’s (IFC) has released a Good Practice Handbook regarding the use of security forces. The handbook expands on the IFC’s Performance Standard Four (Community Health, Safety, and Security) and provides guidance on the proper use of security forces in global operations. In recent years, Canadian courts have been increasingly open to hearing claims alleging liability on parent companies for the misconduct of security forces employed by global subsidiaries. As such human rights issues are increasingly being litigated at home, there is a growing need for companies to develop a best practice approach to security and human rights. As a starting point, the IFC’s Good Practice handbook offers ways for companies operating abroad to understand the breadth of risks they face and how to handle them. Risk Assessment Assessing and mitigating risk is a crucial component of balancing security with respect for human rights. Risk assessment involves examining likely impacts of security risks on the community around a project. Where low risks are likely, risk assessments can be done by those in charge of security internally or by external consultants. But in high-risk situations, risk assessments may entail extensive on-the-ground research with experts and scenario-specific mitigations strategies. Considering Issues of Gender The IFC stresses the importance of including a gendered perspective in the use of security forces. Women have different experiences and interaction with security personnel, so it is important to consult with women to understand issues they might have and adapt risk mitigation strategies. The handbook suggests adapting training guides to reflect this perspective, hiring female security personnel and reaching out to women in the community as various means to incorporating women’s unique experience and perspectives on security forces. Engaging Private Security Good management of privately engaged security forces is key 32 | CANADIAN

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to reducing and mitigating risks. The possibility of conflict is sometimes unavoidable and security forces may be the first to intervene where conflict occurs. The handbook recommends that the security personnel be subject to background checks and diligence, such as being screened for past abuses and dishonesty. They should also be properly trained to follow procedures on the use of force. The handbook also stresses the importance of formalizing the employee relationship through contractual agreements. While not a failsafe, an employment contract supplemented by a code of conduct and the proper monitoring structures will promote good conduct by security personnel. It can also allow for economic consequences to be imposed where breach occurs. Coordination with Public Security Engagement with public security forces is another recommended proactive way to reduce risk. This is especially necessary in high-risk areas where the political climate is unstable. This can be done, for example, by being in contact with the local police or by signing a memorandum of understanding to identify who of the public authorities or the private security forces intervenes for what types of events. Community Engagement Broader community engagement means creating an open door for the community to be heard, both before and after security issues arise. Opening a dialogue with the community can help a company to understand possible areas of conflict or risk. Formalizing a grievance mechanism can facilitate this engagement process and allow for community concerns to be effectively raised with the company. Conclusions The foregoing concepts as developed by the IFC relate to broader human rights risk management, consistent with prevailing standards such as the UN Guiding Principles on Business and Human Rights. The overarching goal is to “respect” human rights in commercial operations. While some circumstances can present very significant challenges for companies, taking a diligence approach and adhering to best practices can serve a company well both from a “social licence” and CMJ a legal and reputational risk. MICHAEL TORRANCE is a partner at Norton Rose Fulbright, Toronto.

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2018-01-02 3:47 PM

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2018-01-02 3:53 PM

UNEARTHING TRENDS

Improving partnership models in natural resource development By Christian Kittleson, Brittany Trumper and Courtney Loftus

n natural resource projects in Canada, industry, government and Indigenous communities all play a critical role at the table. However, these relationships can at times be fraught with tension and misalignment. All sides are seeking a better path forward. With the Canadian government’s recently announced support for a bill that would see the full implementation of the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP), the government is taking a critical step towards reconciliation with Indigenous communities across the country. Although UNDRIP is linked more broadly to universal social issues, its adoption would underscore the importance of building strong partnership models in key areas such as natural resource development. And it’s not only the government that recognizes the need to improve the status quo. Industry and Indigenous communities strive to achieve deeper levels of partnership and better relations as well. Strong partnerships can be difficult to achieve. In an era of UNDRIP and increasing focus on the part of companies to be not just socially and environmentally responsible, but socially and environmentally progressive, new and innovative approaches to building partnership models are required. Current consultation processes do not lend themselves easily to the establishment of common goals and vision, to fostering trust in low trust environments or to building capacity where capacity constraints are apparent. In this environment, it is not surprising that it may prove difficult to build meaningful partnerships as parties assert their own interests in the absence of real opportunities to establish mutual interests. As a result, additional tools may be required to supplement existing approaches and address current gaps. Encouragingly, recent examples suggest that a process of collaboratively designing a future vision between government, industry and Indigenous communities has established trust and led to accelerated agreements. These agreements have been built on developing shared visions of the future, which not only include the benefits flowing from natural resource development, but also education, cultural preservation, health, justice, child welfare and more. This approach is centered on addressing the following questions: w How do we build trust and a relationship based on mutual benefit? w What is our shared vision of the future?

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w How will we achieve this shared vision together? Disrupting the status quo Collaborative design, or co-design, is an approach to building industry, government and Indigenous partnerships to move beyond the status quo. It’s a different approach to traditional negotiations and brings together a variety of parties, many of whom did not play roles in previous negotiation processes. It’s built to ensure that all relevant interests are at the table and equally represented. The goal of co-design is to work together to define a shared vision of the future from which common goals and actions can be articulated. British Columbia has used collaborative design on a number of natural resource development projects and has seen successes. Key benefits of a co-design process include: w Acceleration: Accelerating feedback cycles and seeing meetings that used to be spread over months and years taking place over a matter of days. w Alignment and ownership of a path forward: Going beyond a minimum level of buy-in. w Optimization: Enabling participants to think and work differently. w Risk mitigation: Identifying risks, issues and differences in opinions early on. w Creativity and innovation: Fresh thinking and new expectations of human performance. While collaborative design is not a cure-all for the challenges facing the industry-government-Indigenous relationship in Canada, it may offer an innovative approach to building trust between parties. Collaborative design’s greatest strength is that it encourages higher levels of engagement between parties. However, without the necessary planning and follow-through on agreements, the process will not deliver its intended benefits. Government, industry, and Indigenous communities are all calling for changing the existing way of doing things and for the development of long-lasting partnerships that deliver growth and equal opportunity. Collaborative design may be one avenue that gets us there. CMJ CHRISTIAN KITTLESON is Indigenous lead and associate partner, Advisory and Performance improvement; Brittany Trumper is manager, Advisory and Performance Improvement; and Courtney Loftus is an associate, Climate Change and Sustainability, at EY Canada.

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