In last November's Ontario Speech from the Throne, the
Liberals highlighted their commitment, "to improve the quality
of life and expand economic opportunities for all Aboriginal
peoples in our province, both on- and off-reserve."
A majority of people in Ontario desperately hope these words
are not empty rhetoric, however this Government's current
mineral policies seem to indicate that the "mining sins of the
father are being repeated by the sons."
In 1950, my Polish immigrant parents moved to Sudbury due to
the many jobs in the nickel mines. At that time, Northern
Ontario was experiencing an enormous resource boom, supplying
the metals and forest products desperately needed by North
American and European economies that were rebuilding after the
Second World War. That boom generated tens of thousands of well
paying industrial jobs and created labour shortages in many
communities.
My father worked for Inco Limited all his life. He built his
own house in a thriving working class neighbourhood, and helped
raise two boys with a stay-at-home mother.
The only tragedy of that prosperous era was not integrating the
many aboriginal communities into Northern Ontario's resource
boom. Much of the poverty and social dysfunction in the
region's First Nation communities would have been alleviated
with the abundance of work that allowed my parents to have a
decent life.
According to the Australian Institute of Mining and Metallurgy,
during the next 50 years the world will use five times all the
mineral supplies that have ever been mined up to the year 2000.
Brazil, Russia, India and China - the so called BRIC countries
- make up almost half the globe's population and are rapidly
industrializing their economies. They will need a wide variety
of mineral commodities that can be found in Northern Ontario.
Many economists feel we are entering a commodity super-cycle
that will last for decades.
Most Canadians don't realize that the largest private sector
employer of Aboriginal people is the mining industry. There are
approximately 1,200 First Nation communities within 200 kms of
active mineral operations across the country.
National Chief Phil Fontaine of the Assembly of First Nations
has stated, "In resource development, First Nations and the
mining community are natural partners…. We see these
partnerships primarily rooted in ventures that will provide
procurement, investment, and employment opportunities for First
Nations people."
Yet, a powerful environmental lobby and the province's
bureaucracy seem to be on a collision course with the North's
aboriginal communities.
Southern Ontario's green movement is committed to closing off
as much of the vast boreal forest to resource development as
possible. In his recent annual report, the Environmental
Commissioner of Ontario was pandering or "crying wolf" to a
southern audience by claiming mining development would harm
this vast under-populated region.
Some geographic perspective is necessary. Northern Ontario is
enormous, encompassing roughly 90 per cent of the area north of
the French and Mattawa Rivers. Ontario's north is larger in
area than every other province in Canada except Quebec and
British Columbia. Northwestern Ontario is about the size of
France while the Northeast almost equals Italy in size.
According to the Ontario Mining Association, current mining
operations including mine, mill, access roads and tailings take
up less than five square kilometers. Ontario encompasses 1.07
million square kilometers.
The sustainable mining operations that are practiced today have
a much smaller footprint on the environment than in the past.
Rigorous provincial pollution and rehabilitation guidelines are
strictly enforced. In addition, mining companies are required
to provide financial assurances to the government - the current
total is almost $1 billion - that guarantee mine closures
according to plan.
The opposition to mining development by the environmental
movement brings back memories of their success at destroying
the Canadian fur trade a few decades ago and the resulting
increase in poverty and other social ills on isolated reserves.
In the past year, two major resource conflicts in the North -
one involving a powerful multinational company and the other a
small junior explorer - have shown how disconnected the Ontario
government is towards Aboriginal and mining issues.
In the 2007 Ontario budget, the Liberals, with no consultation
with De Beers Canada, raised a previously agreed five per cent
mining tax rate to 13 per cent on the company's one billion
dollar Victor diamond project, located near the James Bay
coast.
This tax only affects diamond mines and was announced after the
company had already spent hundreds of millions on development.
It is standard practice in Ontario to tax isolated mines at a
five per cent rate to reflect the increased infrastructure
costs during construction. This diamond levy significantly
damaged the province's international reputation in the mining
world and both non-Aboriginal and First Nation communities
condemned the provincial tax grab.
De Beers has spent $80 million on electrical transmission and
fibre optic lines that benefit the First Nation communities.
Approximately $135 million in Aboriginal joint venture
businesses have been established. In addition, the company has
spent $1 million upgrading the local high school, $1.2 million
on literacy programs in the coastal settlements, built a
$850,000 training centre and about $10 million on
pre-employment training.
When the Victor diamond project recoups its capital investment,
a revenue sharing agreement with Attawapiskat First Nation is
to go into effect. With this punitive tax, more income goes to
the provincial government, the break-even point will be pushed
back and local communities will get significantly less revenue.
Attawapiskat First Nation Chief Mike Carpenter has publicly
stated, "De Beers Canada's diamond mine is the first and only
opportunity our community has ever had to break free of our
soul-destroying poverty. This diamond royalty tax will steal
the future of our children."
The other major conflict in northern Ontario involves a junior
exploration company called Platinex Inc. and the First Nation
community of Kitchenuhmaykoosib Inninuwug (K.I.), located 600
kilometres north of Thunder Bay.
Most junior exploration companies are generally small outfits
depending on the financial capital markets for their operating
funds. The appearance of a junior exploration company is only
the beginning of the mining process. Only one out of every 1000
exploration plays becomes a working mine. There are First
Nations working with junior exploration companies on their
traditional territories even though disputed land claims have
not been settled.
The original problem between K.I. and Platinex Inc. seemed to
be a lack of meaningful consultation which is mandated by law.
The problems have escalated, a ridiculous $10 billion lawsuit
was initiated by the company, K.I. is currently disobeying a
court order for the resumption of drilling and the community is
insisting on negotiating with the Ontario government over the
issue of sovereignty over traditional lands before any further
exploration activity takes place.
Sadly, a promising development has turned into a bitter
stand-off that should never have happened in the first place.
When this conflict first began, the Ontario government did
nothing.
The province must put the money and resources into reaching out
and educating isolated Aboriginal communities about the mineral
sector. It is Ontario's responsibility to build their internal
human capacity to understand mining and start implementing a
resource revenue sharing agreement that clearly spells out the
benefits to First Nations if a major deposit is developed.
Resource revenue sharing would provide economic incentives for
native people to participate directly in the industry, actively
encourage exploration in their traditional lands, and foster
greater co-operation with companies.
The provincial government must also make the settlement of all
outstanding land claims issues in northern Ontario a political
priority. Again, more funding and resources combined with close
co-operation with the federal government would resolve most
outstanding issues.
The world's insatiable demands for mineral products have given
Ontario a second chance. Unfortunately, the province's
political elite seem more concerned about a media-savvy
environmental movement, with enormous voter clout, than a
powerless Aboriginal underclass.
I fear the "mining sins of the father" are being repeated by
this current generation and the terrible economic isolation,
poverty, and social despair in First Nation communities across
northern Ontario, will not be resolved.
Stan Sudol is a Toronto-based executive speech writer and mining columnist.www.republicofmining.com