TORONTO, March 17 (Reuters) - An aboriginal protest movement that’s often compared with Occupy Wall Street has the potential to disrupt mining projects across Canada, threatening to undermine the country’s coveted reputation for low-risk resource development.
Idle No More, a grass-roots movement with little centralized leadership, swept across Canada late last year with the help social media. Protesters blocked roads and rail lines, and staged big rallies in the country’s largest cities to press a sweeping human rights and economic development agenda.
Mining companies are also in the movement’s sights as aboriginal bands seek to renegotiate old agreements and seize more control over mining developments, whether they are on lands designated as native reserves or not.
“We’ve existed in this territory for millennia. We don’t have a land claim - it’s beyond that, actually. Our rights exist throughout all of our territories,” Arlen Dumas, chief of the Mathias Colomb Cree Nation, said about the northern Manitoba land where HudBay Minerals Inc, a Toronto-based mid-tier miner, is building its Lalor project.
Protesters cut off access to the gold-copper-zinc mine for several hours in early March, demanding talks with the company on an ownership stake in the C$794 million ($773.84 million)project, which has started limited production.
HudBay, which has mined in northern Manitoba for nearly 85 years, made it clear it prefers not to negotiate directly with the community, which is about 125 km (78 miles) away from Lalor and is one of many First Nations bands in the region.
Instead, the company is participating in an inter-governmental mining committee, which deals with such things as how benefits are split among parties.
“We’re kind of in the crossfire of that,” said HudBay Chief Executive David Garofalo. “At the end of the day it’s important that those governments talk to each other and establish a revenue-sharing model that sustains both governments - both the Canadian governments and the First Nation governments.”
Canada is the world’s top potash producer and the No. 2 uranium producer, and boasts large reserves of base and precious metals. A large percentage of the mineral deposits are in remote areas in the north of the country, where living conditions for aboriginal bands are often poor.
The Canadian protests - groups also blockaded a diamond mine in northern Ontario in a push for jobs and cash - are a far cry from actions taken by countries such as Venezuela and Kyrgyzstan to claw back stakes in projects being developed by foreign miners.
Even so, Canada is feeling the heat. For the first time in six years, Canadian provinces failed to top the list of the best mining jurisdictions in the world in a 2012/13 survey. Companies that participated in the survey said they were concerned about land claims.
“I would say one of the big things that is weighing on mining investment in Canada right now is First Nations issues,” said Ewan Downie, chief executive of Premier Gold Mines, which owns numerous projects in northern Ontario.
Current rules oblige mining companies to consult with aboriginal communities as part of the permitting process and, in many cases, agree on compensation if a development infringes on native rights. Carrots can include profit-sharing, promises of training and compensation funds designed to improve living standards and create much-needed jobs.
But Idle No More, energized by a corps of young, educated and media-savvy activists, appears much less willing to accommodate the mining industry than native leaders have been in the past.
“This movement was about educating First Nations to say no, that’s not what happens when you’re an owner of the resources. An owner of the resources gets resource sharing,” said Pamela Palmater, a professor of politics and public administration at Ryerson University in Toronto.
First Nation opposition has already slowed or derailed at least a half dozen energy and mining projects in British Columbia, and environmentalists are increasingly partnering with aboriginal people in an effort to halt projects.
“It’s the project killer, the investment killer,” said Clayton Thomas-Muller, an aboriginal activist with the Indigenous Tar Sands campaign, which wants to stop further expansion of the Alberta oil sands.
It’s not just new developments that are at risk as the Idle No More movement gains traction.
With isolated communities increasingly turning to social media to share information with others, even companies that already have agreements with local aboriginals could find themselves facing demands for better deals.
“Not all aboriginal communities have been able to enter into the same quality or types of arrangement,” said Blake Langill, Toronto mining leader at global accounting firm Ernst & Young.
“So that sharing of the information will be very powerful,” he said. “It will give them some food for thought as they engage in discussion with the mining companies.”
The blockade of a northern Ontario diamond mine is an example of just that, as protesters from the Attawapiskat First Nation twice in February barred access to an ice road leading to De Beers’ Victor mine, disrupting a winter supply program.
Residents of the reserve, some 90 km (55 miles) east of the mine, were angry over issues ranging from a lack of jobs and training to compensation for the loss of trap lines. They set up the blockade even though an investment deal was signed with De Beers in 2005.
The two sides failed to come to terms on compensation and De Beers, a subsidiary of Anglo American Plc, eventually won an injunction to remove the blockade.
“It’s a constant relationship in progress,” said De Beers Canada spokesman Tom Ormsby, noting the company has been in talks with the community for months over a litany of issues.
Ormsby said De Beers makes payments to a compensation fund and the community must then determine how that money is distributed to individuals.
Compensation is a sticky issue for many communities, and aboriginal law specialist Pierre-Christian Labeau expects demands for better benefits to lead to the renegotiation of some of the older deals, perhaps to add profit-sharing clauses like those seen in more recent agreements.
“For the mining industry, maybe they should be prepared to renegotiate some elements of these agreements, because the reality shows that what we negotiated 10 years ago or five years ago doesn’t work,” said Labeau, chair of aboriginal law at Norton Rose in Montreal.
But it’s not all gloom and doom when miners and First Nations meet. For every project where there is conflict, there are also aboriginal bands that have used mining investment to create economic opportunity for their communities.
At Goldcorp Inc’s Musselwhite gold mine in northern Ontario, five First Nation communities have banded together to create a catering company serving the mine, along with a distribution company that delivers goods across the region.
While development of the mine has forever changed the way of life for the remote community, it has also provided jobs and business opportunities for the reserve’s young people, said Frank McKay, president of Windigo Ventures General Partner.
“The community is aware that eventually the mine will close,” said McKay, a member of the Sachigo Lake First Nation. “If the mine is gone, we still get the revenue from our businesses ... and we have workforce that can be easily moved to other mining operations.”