With the proposed enhancement of Indigenous peoples’ role in several decision-making processes, building strong, positive, mutually beneficial relationships with potentially affected Indigenous peoples may mitigate risks to mining projects in Canada. Even though the specific requirements arising from these processes have not been determined, mining companies may prevent and resolve costly, time-consuming disputes through the approach described below to engagement with Indigenous people.
The return on investment in building such relationships may be most apparent during exploration and mine development. However, such relationships may also significantly mitigate risks during mine operations or even mine closure.
Of course, the notion that relationships with Indigenous peoples are important is not a new one; this concept is a fundamental component of the Mining Association of Canada’s Towards Sustainable Mining initiative. Thus, this article highlights several recent developments occurring in Canada, as well as describes an approach to mitigate associated risks. Uncertainty Amid Recent Developments
Significant uncertainty for future mining projects in Canada is being created by the following three key developments.
> Implementing UNDRIP: The implementation of the United Nations Declaration of the Rights of Indigenous Peoples (UNDRIP)—including through Bill C-262 and otherwise—may significantly affect future mining in Canada. UNDRIP includes a requirement that states will consult and cooperate with Indigenous peoples to obtain their free and informed consent prior to the approval of any project affecting their lands and other resources. A key aspect will be how the concept of "free, prior and informed consent" is defined and operationalized in the Canadian context.
Canada’s Recognition and Implementation of Rights Framework: While the contents of this framework are being determined through engagement with Indigenous peoples, the federal government has indicated the framework, as a starting point, should include new legislation and policy that will make the recognition and implementation of rights the basis for all relations between Indigenous peoples and the federal government in the future. 1 Given the government’s practice of delegating to proponents procedural aspects of engaging with Indigenous peoples, this framework may ultimately affect mine proponents.
Canada’s Proposed Impact Assessment Act: Its combination of a broader consideration of project impacts and mechanisms that may practically result in even longer decision-making processes than under the Canadian Environmental Assessment Act, 2012 may result in contentious mining projects in Canada not being commercially viable under the proposed Act.
The Consequence of Clashes
The implementation of some or all of these decision-making processes is expected to result in projects with Indigenous peoples’ support having a much higher chance of obtaining a timely, positive outcome. Projects that are subject to disputes with Indigenous peoples may encounter, among other things, necessary permits not being issued, the issuance of such permits being challenged and/or delays with respect to the project schedule.
In addition, such disputes may detrimentally affect a project’s financing, whether in the form of project financing or streaming arrangements. Ultimately, the financing impediment is often tied to the uncertainty regarding whether the project will operate (as financially modeled) and if so, when. Further, such disputes may also pose reputational concerns for financing parties.
While these decision-making processes will unfortunately take at least a few years to develop a proven track record and most mining projects cannot afford such a delay, the good news is that action now can mitigate many of the associated risks. Understanding is a Key Component
A sophisticated understanding of the rights and context of an Indigenous people potentially affected by a proposed project, is often necessary for developing a durable relationship. Like any lasting relationship, it must be mutually beneficial. Without understanding an Indigenous people’s rights, history, culture, way of life and current circumstances, […]
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