CRITICAL ISSUE 1:
Weighing the Risks and Benefits
There is no standard guidance for how Indigenous Peoples might weigh the potential risks and benefits of entering into a benefit agreement in the LNG sector. Understanding, needs, capacities and benefits typically requires a case-by-case approach across an entire LNG project’s life-cycle and beyond.
Benefits: Binding agreements between proponents and communities offer opportunities to share in the economic benefits generated by resource extraction. For instance, they can offer communities access to an income stream in the form of royalties or other payments, as well as employment and procurement from Indigenous-owned enterprises. These revenues can assist in meeting a community’s short-term and often urgent needs for services such as housing, health and education, and to augment Indigenous incomes that are usually below national averages (O’Faircheallaigh, 2010, 69. See also (Findlay and Wuttunee, 2007; Mihesuah, 2003; United Nations Permanent Forum on Indigenous Issues, 2004; US DOE, 2017).
Agreements can also contribute to development by providing opportunities for communities to be involved proactively, and continuously, in managing the cultural, social, and environmental impacts of resource use (Innis and MacIntosh, in Mills and Sweeney, 2013). According to Cueva (2017) from an Indigenous standpoint, BAs enhance local development by increasing the level of participation of a historically disadvantaged population.
The negotiation of these agreements could also greatly reduce uncertainties for proponents, over the legality and the legitimacy of a project, considering the legal context surrounding resource development and Indigenous land rights in Canada (Papillon and Rodon 2017; Bradshaw and McElroy 2014; Rodon, Lemus-Lauzon and Schott, 2018, 9).
Risks: There is a very limited body of literature on potential risks to First Nations’ communities as a result of entering into BAs, particularly in the context of the LNG sector. The World Bank (2012) identifies several risks in the creation of formal BAs, though these are framed primarily from the perspective of proponents as follows:
- Formal agreements can foster a counter-productive environment of mistrust and uncertainty if the parties lack commitment to/or understanding of the process and anticipated outcomes
- Potential perceptions that a community or group has been misled or coerced into signing a deal, or that a “backroom deal” has been brokered with one or more parties to the detriment of others and may contribute to conflict at the community level.
- Formal agreements, and the legal stipulations they often include, can lead to an interpretation of compliance that results in a minimalistic approach. When this outcome occurs, it may leave communities feeling like their counterparts across the negotiating table have not lived up to the spirit and intent of agreements.
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AEM – Agnico Eagle Mines Limited
ASDF – Ahafo Sustainable Development Forum
AWBEN – Aboriginal Women’s Business Entrepreneurship Network
BA – Benefit Agreement BC British Columbia
BCFNDGI – BC First Nations Data Governance Initiative
BMZ German Federal Ministry for Economic Cooperation and Development
BNL – Barrick Niugini Limited
BSA – Benefit Sharing Agreement
CBA – Community Benefit Agreement
CDA – Community Development Agreement
CIRNAC – Crown-Indigenous Relations and Northern Affairs Canada
DIO – Designated Inuit Organizations
EIA – Environmental Impact Assessment
EMB – Environmental Management Board
EWB-MSV – Engineers Without Borders Canada - Mining Shared Value Initiative
FNFTA – First Nations Financial Transparency Act
FNLNGA – First Nations Liquefied Natural Gas Alliance
FNNBOA – First Nations National Building Officer’s Association
FPIC – Free, Prior and Informed Consent
GIZ – German Development Agency
HIA – Health Impact Assessment
IA – Impact Assessment
IBA – Impact Benefit Agreement
ICMM – International Council on Mining and Metals
IFC – International Finance Corporation
IFI – International Financial Institution
IIBA – Innuit Impact Benefit Agreement
INAC – Indigenous and Northern Affairs Canada
IOL – Inuit-Owned Lands
ISC – Indigenous Services Canada
KitIA – Kitikmeot Inuit Association
KivIA – Kivalliq Inuit Association
KLC – Kimberley Land Council
LIA – Labrador Innuit Association
LLG – Local Level Government
LNG – Liquefied Natural Gas
M&E – Monitoring and Evaluation
NADeF – Newmont Ahafo Development Foundation
NLC – Northern Land Council
NLCA – Nunavut Land Claims Agreement
NTI – Nunavut Tunngavik Incorporated
OSR – Own-Source Revenue
PJV – Porgera Joint Venture
PSAB – Procurement Strategy for Aboriginal Business
QIA – Qikiqtani Inuit Association
SEMC – Socio-Economic Monitoring Committee
SML – Special Mining Lease
TCS – Tax Credit Scheme
UNDRIP – United Nations Declaration on the Rights of Indigenous Peoples
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