April 15, 1997

L. Denis Desautels
Auditor General of Canada
240 Sparks Street
Ottawa, ON
K1A 0G6

Dear Mr. Desautels

Please consider this letter as a petition pursuant to section 21 of the Auditor General Act. We are residents of Canada and are therefore eligible to make such a request. The substance of our petition is that the system of disposing of Crown mineral rights in the Northwest Territories (N.W.T.) is entirely inconsistent with the definition of sustainable development contained in the Auditor General Act. Furthermore, it is our contention that there is no evidence that the Department of Indian Affairs and Northern Development (DIAND) is making any progress towards adapting the current regime so that it is consistent with the principles of sustainable development.

 Particulars of Petition

The current regime for granting third parties rights to Crown owned minerals in the N.W.T. is found in the Canada Mining Regulations (CMRs). These regulations are administered by the Department of Indian Affairs and Northern Development (DIAND). DIAND is a Category 1 Department.

The CMRs establish what is known as an open access or free-entry mining regime. Under an open access regime all Crown lands are open for mineral operations unless they are specifically withdrawn. There is no prior planning to establish which tracts of Crown land are particularly sensitive, or serve as critical habitat for endangered species, or are valued ecosystem components. There is no requirement that government consult Aboriginal peoples or other land users (i.e. outfitters, forestry operators) prior to opening lands for mineral exploration.

More specifically, we contend that the Department's continuing failure to launch a comprehensive review of the CMRs regime shows that it is simply ignoring the need to make progress towards achieving sustainable development as required by s.21.1 of your Act. Here are the particulars of our contentions following the list of factors identified in s.21.1:

 (a) integration of the environment and the economy

 There is no evidence whatsoever that environmental factors are integrated in the design of the CMRs. On the contrary, the CMRs are informed by a development ethic in which resource rights are simply given away to the first comer.

(b) protecting the health of Canadians

Again, there is no evidence that this is a relevant consideration. The record of the Giant Mine in Yellowknife suggests that the health of Canadians is not high on the list of priorities for the Department. The free-entry system even applies to the search for and development of radioactive materials (e.g. Rayrock, Port Radium, Kiggavik) without considering the public health and related policy questions.

(c) protecting ecosystems

 A free-entry system makes it impossible to take into account considerations of ecosystem health in the absence of an adequate planning mechanism designed to ensure that lands valued for reasons of ecosystem health are withdrawn from disposition or staking. This is not the case in N.W.T. where mineral staking precedes ecological planning. Although a protected areas strategy for the N.W.T. is finally being developed, its implementation including land withdrawals, may take years. The strategy is being developed as a direct result of the World Wildlife Fund application for judicial review on the BHP N.W.T. Diamonds Project public environmental review and was not initiated voluntarily by DIAND.

(d) meeting international obligations

 Open access regimes, unless accompanied by the planning mechanism referred to above, make it more difficult for Canada to discharge its obligations for in-situ conservation under the Biodiversity Convention and its obligations to Aboriginal peoples under the Rio Declaration, Agenda 21, the UN Draft Declaration on the Rights of Indigenous Peoples, and s.35 of the Constitution Act, 1982.

(e) promoting equity

The application of the open access regime to areas of unsettled land claims in the N.W.T. promotes inequity insofar as it facilitates the systematic undermining of the local economy and allows development before the Aboriginal inhabitants are in a position to benefit from that development. DIAND makes no attempt to balance, and is in fact prevented from balancing, the public interest in rational and ecologically sustainable resource management versus the private interests that are established once a mineral claim has been staked and recorded.

(f) an integrated approach that balances costs

Again there is no evidence that an open access regime is capable of balancing costs. All land is open to staking unless withdrawn. There is no pre-assessment of mineral values and ecological values. The land is simply open for exploration and potentially production. Furthermore, the very system of locating and maintaining claims encourage waste of resources and environmental practices that are not sustainable. Finally, encouraging third parties to obtain mineral rights prior to land use planning or designation of conservation lands may leave the Crown exposed to compensating those parties when lands may need to be withdrawn (see Tener case).

(g) preventing pollution

 There is no evidence that pollution is a relevant consideration in the CMRs. The requirement for representation work to maintain claims actually encourage activities that result in pollution of air, land and/or water. There are no provisions to reward activities that are less damaging to the environment (e.g. map staking, surveys without trenching or ground work).

(h) respect for nature and the needs of future generations

 There is no evidence that a free-entry system balances the needs of nature. Such a system is based on a developmental ethic rather than an ecological ethic. It also assume that all lands should be open for development now. In such a system it is hard to plan development so that it occurs in a staged and managed manner that benefits the residents of the region and avoids a boom and bust economy.

There is absolutely no evidence that the Department is proactively developing policy to adapt the current regime so that it is consistent with the principles of sustainable development.

 The record shows that the Department is failing to make progress towards the goal of sustainable development in relation to the minerals regime of the N.W.T. Indeed, the Department is failing to even ask itself the right questions. The Department will tell you that it has launched a review of the CMRs and that in particular it has initiated a review of reclamation policies and the royalty regime. We are aware of these developments but we note that this is a piece-meal approach that does not address the principles that underlie an open access regime. Furthermore, we note that in neither review does the Department so much as mention the term sustainable development. We have also reviewed the Department's discussion paper on its Sustainable Development Strategy and note that it does not propose to examine the principles underlying its current range of resource statutes to see if they are consistent with the principles of sustainable development. We suggested that this is a key requirement at a workshop held in Yellowknife in December 1996.

 In closing we note that we do not argue in this petition that mining is per se inconsistent with the principles of sustainable development. Instead, it is simply our position that it is possible to design a minerals disposition and regulatory regime that is sensitive to principles of sustainable development and ecosystem health. To this point DIAND has made no attempt to do so.

Thank you for your time and help. We look forward to the Department's response to this petition and suggest that this is a topic that warrants your immediate attention. We can be contacted at (403) 873-4715 should you require any clarification.

Sincerely,

Kevin O'Reilly Nigel D. Bankes
Research Director Vice-Chairperson

cc.

Hon. Ethel Blondin-Andrew, MP Western Arctic
Jack Anawak, MP Nunatsiaq
Hon. Charles Caccia, Chairperson, Standing Committee On Environment
and Sustainable Development
Brian Emmett, Commissioner of Environment and Sustainable Development
Hon. Don Morin, Premier of the N.W.T.
James Eetoolook, Vice-President, Nunavut Tunngavik Incorporated
Nellie Cournoyea, Chairperson, Inuvialuit Regional Corporation
Richard Nerysoo, President Gwich'in Tribal Council
Larry Torangeau, President, Sahtu Secretariat Incorporated
Chief Gerald Antoine, Deh Cho First Nations
Grand Chief Joe Rabesca, Dogrib Treaty 11 Tribal Council
Marilyn Sanderson, Executive Director, Treaty 8 Tribal Council
Dene National Chief Bill Erasmus, Dene Nation
Gary Bohnet, Metis Nation of the N.W.T.
Mike Vaydik, General Manager, N.W.T. Chamber of Mines
George Miller, Executive Director, Mining Association of Canada