It is no secret that the oil and gas industry is facing an unprecedented crisis. A collapse in demand arising from COVID-19 lockdowns and a price war between Russia and Saudi Arabia have led to devastating cuts in production, jobs and revenues. As part of its request for federal support, the industry has asked Ottawa to delay legislation harmonizing Canadian law with the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP). Assembly of First Nations Chief Perry Bellegarde has replied that delay is “unacceptable” and the “industry must support the plan to implement the declaration as it provides the necessary standards to respect human rights.”
I want to be clear. As a CEO of an energy company, I support UNDRIP. I have been doing business with the Kanaiwa Blood Tribe in southern Alberta for decades. I sit on the board of the Indian Resource Council and chair the Canadian Association of Petroleum Producers’ committee on Indigenous policy. I have devoted a fair part of my professional life to ensuring good business relations between the oil and gas industry and Indigenous communities. Respecting the rights of our Indigenous partners is not only the right thing to do. It is also the smart thing to do, if you want a project to go smoothly.
But while I have no problem with UNDRIP, I am deeply concerned with the federal government’s proposed legislation to implement it. Although Bill C-262 died on the order paper before the 2019 election, the government has committed to reintroducing similar legislation this year. Legal experts called Bill C-262 vague, unclear and open to interpretation. In my view, the way it was written would almost certainly deter investment in Indigenous territories — even though, as my experience has shown me, the majority of Indigenous people want to attract responsible development.
UNDRIP implementation is the crux of the regulatory and legislative challenge to resource development in Canada
The main question is around the principle of “free, prior and informed consent” for resource projects and whether or not the requirement to obtain consent effectively provides a veto for every First Nation, Métis and Inuit community in the country. Government and Indigenous leaders have said it does not. That is reassuring, especially for linear projects that can cross dozens or even hundreds of territories. But from a legal standpoint it is meaningless: the text of the bill itself provides no clarity on this important issue. The bill does not define consent. To many of us in the industry, this guarantees that sooner or later the issue will end up in court.
British Columbia’s experience is instructive. It passed its own UNDRIP legislation — Bill 41 — last November. While one can applaud the provincial and Indigenous leaders’ commitment to reconciliation that the legislation represents, the fact that the bill was similarly vague created uncertainty almost immediately, especially within the context of the Coastal GasLink pipeline dispute in Wet’suwet’en territory. Advocates on all sides interpreted B.C.’s UNDRIP legislation in whatever way bolstered their own positions, adding confusion and resentment instead of clarity to the situation.
UNDRIP implementation is the crux of the regulatory and legislative challenge to resource development in Canada. Who would commit millions of dollars for the consultations, feasibility studies and environmental assessments that large projects require, knowing that this legislation is just waiting to be tested in court? The oil- and gas-producing First Nations that I work with are suffering from the current industry crisis as much as any oil company, and in many cases much more. Collectively, they will see their royalty revenues drop by over 95 per cent from their peak in 2012. These communities want a business environment that attracts investment to their territories. Sadly, that’s not what we have in Canada today.
I believe that the vast majority of the oil and gas industry, the federal government, the Canadian public and Indigenous peoples share the same goal: we all want good, environmentally sound projects that have communities’ support to proceed. By adding yet another layer of legal uncertainty to investment on Indigenous territories, the UNDRIP legislation will produce the opposite.
The good news is that this is not an insurmountable problem. Investors and oil companies don’t want to shelve Indigenous rights. We just want legislation that is clear and comprehensive enough that it will not inevitably end up in the courts. To address these problems, the government should clearly articulate what practical differences the UNDRIP legislation will produce.
Common ground is within sight. Let’s not conflate reasonable requests to clarify legislation with violating human rights. Instead let’s ask the federal government to come up with law that answers questions rather than raises them.
Brian Schmidt is an honorary chief of the Kainaiwa and CEO of Tamarack Valley Energy.