CALGARY, Oct. 23 -- Unresolved disputes over land access and aboriginal treaty rights could hamper the fast-approaching winter drilling season in northeastern British Columbia.
The area includes the Ladyfern region, where one of the hottest natural gas plays in North America is ramping up. Following a major discovery in 2000, the area is producing more than 500 MMcfd, equal to production from the Sable Island fields off Nova Scotia. Analysts estimate the Ladyfern play has reserves of up to 1 tcf.
The Halfway River First Nations community, which blockaded a road 50 miles northwest of St. John, BC, in August to halt a Petro-Canada pipeline project, says a coalition of First Nations groups is planned and further action is possible this winter unless progress is made on talks.
The native group claimed the 14-mile pipeline would damage traditional hunting grounds. The blockade ended when the hunting camp was closed for the winter.
There is industry concern that First Nations protests could spread to other areas, including the Ladyfern gas play to the east. The short winter drilling season is approaching, with activity usually limited by weather to a window between mid-December and mid-March.
The recently elected BC government is negotiating with First Nations groups in an effort to settle unresolved issues. Native groups also are negotiating separately with Petro-Canada and Canadian Natural Resources Ltd., which were targets of First Nations action. Petro-Canada has put its pipeline project on hold and said it wants to resolve issues with First Nations communities before proceeding.
Petro-Canada Pres. and CEO Ron Brenneman said recently that native activism could spread beyond northeastern BC and become an issue unless governments talk to First Nations.
"It can be significant for the industry even if it's just Northeast BC, but the whole issue could spread beyond Northeast BC. I think governments really have to stand up and take notice of what is going on up there," Brenneman said.
The Union of BC Indian Chiefs has offered full support for the Halfway River group and other First Nations that supported the blockade.
Halfway River Chief Bernie Metecheach said his people have been frustrated for years in attempts to negotiate with government and industry on the exploding resource development on their traditional lands. He said the peaceful blockade was implemented because hundreds of letters and many meetings had been a waste of time.
"Our Treaty 8, signed in 1899, constitutionally guarantees us the right to enjoy our traditional rights, without interference by resource developers authorized by the province of BC," the chief said.
The Halfway River community said its demands include:
-- A moratorium on all resource development on their lands until an independent and comprehensive cumulative environmental impact assessment is completed, with First Nations involvement.
-- That the federal government meet its fiduciary responsibility and negotiate the interpretation and implementation of treaty rights.
-- That all resource developers immediately agree to negotiate agreements with First Nations relating to proper consultations, avoidance of interference with treaty rights, mitigation and compensation for damages, and guarantees for socioeconomic benefits.
Ken Rich, a spokesman for Halfway River, said there has been little progress in discussions with companies on access and other issues. Rich said in mid-October the band had 62 work applications before it, and everything was on hold. He said no applications had been approved on Halfway River lands by the group or by the regulatory commission since June 23.
He said the group has recently began discussions with Derek Doyle, newly appointed head of the BC Oil and Gas Commission, the industry regulatory body. The Halfway River spokesman said, however, that the commission cannot look at political issues such as revenue-sharing and co-management of resources.
Rich said First Nations groups from BC, the Lower Yukon, and Alberta will meet in November to map plans.
"Our communities want to come up with an idea on how to tackle this. There is a definite possibility of more blockades," Rich said.
"The key to a drilling season without problems is to get a working agreement on the issues. We don't have a fight with the companies. They have to do their work. The oil companies should be concerned about the situation."
Laurie Stretch, a Petro-Canada spokeswoman, said there has been much discussion among the players but no clear resolution of the issues. She said there are both immediate winter drilling issues and also the longer-term issue of improving the predictability of the business climate in northeastern BC.
"Our interest in the region is very much to ensure good long-term working relationships with all the stakeholders in the region, including the First Nations," Stretch said.
More than a year ago, the Canadian Association of Petroleum Producers (CAPP) urged Ottawa to start negotiating aboriginal land claims and deal with native complaints. The association said there is an urgent need for Ottawa to deal with First Nations issues, not just in BC, but in other areas such as the Northwest Territories. So far, the federal government has taken the position that the BC situation is a provincial matter.
CAPP Pres. Pierre Alvarez said the association is spending a lot of time on the situation and is encouraged that the BC government is starting to deal with the issues on a priority basis.
He said the disputes "make it very, very difficult for companies to plan and execute their programs."
Alvarez said some companies in northeastern BC may reduce their winter work programs if they cannot be completed in timely and cost-effective ways.