Indigenous Impact Benefit Agreements That Broke New Ground in 2017

inuit-impact-benefit-agreement-mining2.pngFrom innovative arrangements for construction contracts and training to out-of-the-box approaches to equitable revenue sharing, here's our list of Indigenous Impact Benefit Agreements that broke new ground in 2017.

 

Back River Gold Mine, Sabina Gold and Silver Corporation

Kitikmeot Inuit Association

Sabina Gold's plans for the Back River Gold Mine include a chain of open pit and underground mines in the western Kitikmeot Region of Nunavut. The project is expected to be operational for at least 10 years and will involve damming and draining lakes and streams and building a 160km road from the mine to a seasonal port. 

 

Highlights
  • initial investment of $4 million in regional wealth creation initiative
  • an annual payment of up to $1 million to cover KIA's costs of implementing the IIBA
  • a 1% net smelter return royalty 
  • a grant of 6.7 millon Sabina shares 
  • water and wildlife compensation agreements if Sabina fails to implement it's commitments to mitigating impacts on caribou habitat
  • commitments associated with Inuit employment, training, education, business opportunities, formation of an Inuit Environmental Advisory Committee and investments in community infrastructure projects

Source: Nunatsiaq Online

 

Pushing the envelope

The key innovations in this IIBA include the regional wealth creation initiative, a "carrot and stick" approach to managing impacts on caribou habitat, and a clear and simple net smelter royalty that eliminates substantial financial analysis in calculating revenue sharing payments.

 

Whale Tail Gold Project, Agnico Eagle Mines Ltd.

Kitikmeot Inuit Association, Nunavut Tunngavik Inc.

The Whale Tail project is a satellite deposit approximately 50 km north of Agnico's existing Meadowbank open pit gold mine in central Nunavut. Agnico hopes to start producing ore from the mine by the end of this year.

 

Highlights
  • $6.5 millon payment, including $3 million towards a community initiative fund
  • 1.4% net smelter return on production
  • Resource royalties and fees paid to KIA and Nunavut Tunngavik Inc. from the Whale Tail project and two other Agnico-owned projects in the region
  • Investments in annual training programs with an additional $1 million investment in the event that a 50% Inuit employment target is not reached
  • Preference points for Inuit-owned businesses to compete more effectively for contracts

Source: AgnicoEagle.com

 

Pushing the envelope

The key innovations in this IIBA are, as with the Black River Gold Mine and  the Kitikimeok Inuit Association is the use of a  a clear and simple net smelter royalty that eliminates substantial financial analysis in calculating revenue sharing payments, and the requirement for specific investment penalties if employment targets are not reached.  

 

East West Tie Transmission Line, NextBridge Infrastructure

Fort William, Red Rock Indian Band, Pays Plat, Biigtigong Nishnaabeg, Pic Mobert and Michipicoten 

This 450km long, $777 million transmission line development is aimed at bringing a stable source of electricity to northwestern Ontario, anticipated to be in service by 2020. The Anishnabek First Nations listed above have formed a partnership called "Bamkushwada" which has partnered with NextBridge in the construction of the East-West Tie line from Wawa to Thunder Bay.

 

Highlights
  • a 20% equity stake for a group of six local First Nations
  • support for the creation of an economic partnership called "SuperCom" to assist communities in connecting the construction manager with local contractors and journeyman for training and employment

Source: TD World

 

Pushing the envelope

The key innovations in agreements with First Nations include the significant economic partnership and equity  stake of First Nations to help ensure that the economic benefits of the project will stay in the region, and that substantial opportunities for contracting, training and employment are realized that can help diversity the economy of the First Nations for the long-term.

 

Negotiations we will be watching in 2018

Qikiqtani Inuit Association and Tallurutiup Imanga, Parks Canada

The QIA are negotiating an interesting Inuit Impact Benefit Agreement for the Lancaster Sound marine conservation area, one of Canada's new protected areas, that will set precedents for the working relationship between federal and Indigenous governments in the co-management of protected areas.

 

 

 

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About Us: Shared Value Solutions

 

We are an Ontario B Corp, and we assist Indigenous communities with support throughout regulatory processes surrounding major development projects like mines, hydroelectric facilities, transmission lines, highway expansions, oil and gas pipelines, natural resource transport applications and nuclear power. 

 

We have deep context and experience behind the recommendations we provide, having worked for our clients on almost every major project in Canada over the last 10 years. For us, it’s all about building long-term relationships with our clients. We want to get to know you and what you want to do so we can help you move your plans forward. 

 

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