August 24, 2010 / 10:41 PM / 7 years ago

Canada province, aboriginals in mine revenue deal

VANCOUVER (Reuters) - British Columbia signed an agreement on Tuesday that will see Canada’s westernmost province share tax revenue from the mining industry with aboriginal groups, the first such deal in the mineral-rich region.

The agreement between the Canadian province and the Stk‘emlupsemc of the Secwepemc Nation was welcomed by the industry, which hopes the deal will improve relations between miners and First Nations people, and make native Indian groups more receptive to mining activities on or near their lands.

“It is the right thing to do. It is also good for business,” said Pierre Gratton, President and Chief Executive of the Mining Association of British Columbia.

These agreements will help “to show First Nations right at the outset that there is something for them from our activities,” Gratton told Reuters.

Native groups were not immediately available for comment.

Tuesday’s agreement is expected to be the first of many in the province’s mining sector, said Randy Hawes, British Columbia’s minister of state for mining. The province’s large forestry sector has been sharing revenues with First Nations since 2003.

The deal inked on Tuesday will see mineral tax revenue generated by New Gold Inc’s New Afton project shared with the Tk‘emlups and Skeetchestn First Nations.

Over the life of the mine, which is currently under construction just outside the town of Kamloops, some C$30 million ($28 million) is expected to flow to the two native bands, Hawes told Reuters.

Each agreement will be structured differently, he said. The government is signing its second agreement on Wednesday with the McLeod Lake Indian band on the Mount Milligan gold-copper project owned by Terrane Metals.

Hawes said that even though the province had a lot of large mineral deposits, they were often not that rich, making mining companies leery of potentially drawn-out and expensive battles with native groups.

“I do believe we have made B.C. a much, much more attractive place to invest,” Hawes said.

In addition, the revenue should improve the social and economic conditions on native Indian reserves, he said.

“For me the bottom line is that there are so many kids on First Nations territories... The future must look bleak to some of those kids,” Hawes said.

($1=$1.06 Canadian)

Reporting by Nicole Mordant; editing by Rob Wilson

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