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OTTAWA (Reuters) - Enbridge Inc's controversial plan to build a pipeline to the Pacific Coast from oil-rich Alberta requires the consent of aboriginal bands, some of whom staunchly oppose the project, Canada's top native leader said on Wednesday.
The contention underlines the difficulties facing Enbridge as it tries to push through the C$5.5 billion ($5.4 billion) Northern Gateway project, which would cross land belonging to many Indian bands, or first nations, so the oil sands-derived crude could be shipped to Asia and California.
Shawn Atleo, national chief of the Assembly of First Nations, said bands had "the right to free, prior and informed consent" over projects affecting their territory.
"We need to move away ... from the notion that we are only stakeholders when it comes to major projects. Whether it be a pipeline or a mine, first nations have real rights (and) those rights must be recognized when it comes to any development in this country," he told a news conference in Ottawa.
The oil industry and Canada's federal government want the 525,000 barrel a day pipeline to proceed as quickly as possible as a way to diversify markets and increase returns for the Alberta tar sands, the world's third-largest oil deposit. Hearings into the development began this month.
Native Indians, who make up around 1.2 million of Canada's 34.5 million population, largely live on reserves and suffer high levels of poverty, crime, unemployment and poor health. However, Canada's booming resource industries are increasingly seeking access to those lands.
Enbridge has offered aboriginal communities affected by its proposal to share in 10 percent of pipeline's ownership and C$1 billion of community development money. A company executive said in Edmonton on Tuesday that 40 percent of first nations along the route have signed on to the equity offering.
However, many in British Columbia have said they do not want the project to move forward under any conditions, citing fears of oil spills on ancestral lands and in coastal waters.
In a blow to Enbridge's aboriginal relations last week, a deal it signed with British Columbia's Gitxsan First Nation fell apart when chiefs voted down the agreement, which had been signed in December by one of their ranks.
Canada's right-of-center Conservative government says Northern Gateway and other similar proposals will help boost exports of tar sands-derived crude and provide lots of employment for natives and economic development for their communities.
The project took on more urgency for the government and an industry spending billions of dollars tapping the oil sands after Washington this month rejected TransCanada Corp's Keystone XL pipeline to Texas from Alberta.
"There's money on the table, there's equity participation and there's jobs. So it's our hope to continue to have a dialogue with first nations and see whether we can, together, achieve our common objectives," Joe Oliver, Canada's natural resources minister, said in Calgary.
"We have a moral and constitutional obligation to consult, to accommodate, and we will of course do that, and the regulatory process contemplates it."
Oliver said the government has not been talking about intervening in the regulatory process should the proceedings not go as it hopes. Some aboriginal groups have said they are already preparing legal cases should the pipeline be approved against their wishes.
Increasingly unhappy aboriginal leaders say one big reason for their troubles is what they describe as the refusal of Ottawa to live up to treaties signed centuries ago between native bands and former colonial ruler Britain.
They say those agreements gave them rights over resources on their lands and are still valid.
"We have continued to lurch from crisis to crisis with deep social ills and deplorable conditions in our communities, very often when these communities are adjacent to major natural resources projects," said Atleo.
He said he wanted to break away from what he called the "Ottawa knows best" mentality.
Atleo spoke a day after hundreds of first nations chiefs held a formal meeting in Ottawa with Prime Minister Stephen Harper and senior cabinet ministers to press for more powers to improve living conditions and for more rights over resources.
Tempers are rising, and one senior British Columbia chief said this week that "an aboriginal uprising is inevitable" unless Ottawa handed over more control.
Additional reporting by Jeffrey Jones in Calgary; editing by Rob Wilson