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THE BHP INDEPENDENT ENVIRONMENTAL MONITORING AGENCY
AS A MANAGEMENT TOOL
PREPARED FOR
THE LABRADOR INUIT ASSOCIATION
SUBMITTED TO
VOISEY'S BAY ENVIRONMENTAL ASSESSMENT PANEL
by
Kevin O'Reilly
October 1998
DISCLAIMER
This paper was prepared at the request of the Labrador Inuit Association. The paper is based on the author's personal experiences during the BHP Environmental Assessment, the subsequent Northwest Territories Water Board public hearings, the negotiation of the Environmental Agreement and finally, as a member of the Board of Directors for the BHP Agency. It does not necessarily represent the views of the BHP Independent Environmental Monitoring Agency or its Board members. The author bears the sole responsibility for any errors or omissions.
Kevin O'Reilly
Introduction
The purpose of this paper is to outline the establishment of the BHP Independent Environmental Monitoring Agency (referred to as the Agency), its work to date and some of the lessons learned that may prove of assistance for the Voisey Bay Project.. A description of the Ekati mine and its setting are also provided.
Project Description
Two Canadian geologists tracked key indicator minerals across the Northwest Territories (NWT) usually associated with kimberlite, and potentially diamonds, in the 1980s. In 1989 mineral claims were staked by Dia Met Minerals to cover the sources found in the Lac de Gras area about 350 km northeast of Yellowknife. A joint venture agreement was signed with Broken Hill Proprietary Company Limited (BHP) to provide the finances for exploration and development. Diamonds were found in the 4,000 square km claims block in the fall of 1991 setting of a tremendous staking rush on adjoining lands.
The project was later named the Ekati mine after the Dogrib Dene name for Lac de Gras. Five open pits were proposed to mine diamonds. One of the pits is proposed to cover a kimberlite pipe about 30 km southeast of the main cluster. The project has an expected life of 8 years at 9,000 tonnes per day of kimberlite ore and a further 15 years at 18,000 tonnes per day. Active exploration of the claims block continues with several major economic finds reported.
About 1,000 people were employed on site during the peak construction period and an average of 830 full time employees will serve during the production period. Commercial production began in the fall of 1998 with the official opening ceremonies held on site on October 14, 1998. The operation is expected to generate about $400-500 million per year gross.
Materials for construction and operation for the mine are brought in over a 476 km winter road from Yellowknife where possible or by air if necessary. Power is generated on site using diesel fuel.
Project Setting
The Ekati mine is located beyond the treeline in the Takijuq Lake Upland ecoregion. The Bathurst caribou herd, the largest herd in the NWT at 350,000 animals, crosses through the project area during spring and fall migrations. Grizzly bears, wolves and furbearers are found in this region. The project is just north of Lac de Gras which is the headwaters of the Coppermine River.
The Ekati mine is in an area traditionally used by the Dene and Inuit for hunting, trapping and fishing. There is archaeological evidence of use of the area. Dene and Inuit elders recall their travel through the project site. The nearest community is Wekweti (Snare Lake) 180 km to the west with a population of about 175. Several other communities are located around the mine site, the largest being Yellowknife with a population of 18,000.
There are no settled land claims covering the project area. The Nunavut Territory and Inuit land claim boundary is about 90 km to the north and east. Inuit from the Kitikmeot region to the north of the mine, have demonstrated traditional land use and occupancy of the project area. Treaty 11 signed by Dene in 1921 only covers the area on south shore of Lac de Gras so the Ekati mine is in an area of unextinguished Aboriginal title. The Dogrib Treaty 11 Tribal Council is negotiating a comprehensive land claim that covers a large area north of Great Slave Lake including the project site. An agreement-in-principle is expected in late 1998. The Treaty 8 communities of Detah, Ndilo and Lutsel K'e are in the preliminary stages of negotiating treaty entitlement to Akaitcho territory that covers a large area including the mine site. The North Slave Metis Alliance is attempting to negotiate a comprehensive land claim that would cover the project site.
The federal government, through the Department of Indian Affairs and Northern Development, still retains jurisdiction over lands and waters throughout much of the NWT. Few lands are held privately other than those owned by Aboriginal governments through the settlement of claims. Small pockets of land in communities have been transferred to the territorial government which also has jurisdiction over wildlife, health, education, roads and some other areas of quasi-provincial authority.
Regulatory Review of the Ekati Mine
In January 1994 BHP submitted a project description to DIAND to initiate a formal environmental assessment under the federal Environmental Assessment and Review Process Guidelines Order. A joint federal-territorial advisory body, the Regional Environmental Review Committee, recommended to the DIAND Minister that the project should be the subject of panel review in April 1994. Three months later DIAND referred the project for a panel review which was formally announced on December 8, 1994 with the appointment of four panel members.
A detailed Environmental Impact Statement (EIS) was submitted by BHP in July 1995. Additional information was requested by the panel and hearings began in January 1996. The panel filed its report on June 21, 1996.
The public review was fraught with procedural problems that are documented in O'Reilly (1996), Canadian Arctic Resources Committee (1996) and Canadian Institute of Resources Law (CIRL) (1997). The severely restricted resources available to participants and the panel, very tight time lines, limited scope of the assessment and other factors, all led to a public review that was neither fair nor rigorous. The procedural difficulties were so severe as to form the basis of an application for judicial review by one of the intervenors. Few if any of the participants came away from the environmental assessment with any satisfaction including the proponent.
The panel's recommendations were general in nature and regarded as weak by Aboriginal and environmental interests. Project approval was recommended with some suggestions to clarify policy areas and future government actions, and some advice for consideration during the regulatory phase of the project approvals. Further detail on the panel's recommendations on environmental monitoring and management are found later in this paper.
On August 8, 1996 DIAND Minister Ron Irwin and NWT Premier Don Morin announced government approval-in-principle for the Ekati mine subject to 'satisfactory' progress within 60 days on a variety of regulatory instruments and non-regulatory agreements. This requirement for progress on impact and benefit agreements, a legally binding environmental agreement and a socio-economic agreement with the territorial government, went well beyond the recommendations from the panel. The Minister appeared to use his authority to sign off the required water licence as leverage to force these additional items from BHP without any clear legal requirements (see CIRL 1997).
A frantic period of negotiations began which stretched all the parties to the breaking point. The NWT Water Board also began its hearing on BHP's water licence application during this period. The Board issues licences for water use and waste deposition into water under federal legislation. Without a licence, BHP could not operate its Ekati mine. Although the Board has a set of procedures, proceedings had been traditionally kept very informal. The Dogrib Treaty 11 Tribal Council, Akaitcho Treaty 8 communities, and Kitikmeot Inuit Association were all represented by legal counsel and pushed strongly for an adjournment to properly prepare after DIAND had finally provided financial assistance. Intense cross-examinations took place and at least one essential federal agency failed to appear. The Aboriginal organizations clearly used these hearings to put further pressure on BHP towards fair negotiation of impact and benefit agreements while raising significant technical issues.
By the time of the recommencement of the water licence hearings on October 21 and 22, 1996 progress had been made on a number of fronts including the environmental agreement and some of the impact and benefit agreements. An intense period of drafting a water licence took place after the hearings during which Aboriginal, environmental and government advisors were all involved.
Sufficient progress had been shown in the Minister's mind on January 8, 1997 when he announced that two impact and benefit agreements had been reached, he had just approved the crucial water licence, an environmental agreement had been signed, the socio-economic agreement with the territorial government was completed, and that the project could now proceed. There was little time available and almost no energy left, to conduct a careful review of how all the regulatory and non-regulatory management tools fit together.
The Environmental Agreement
The impetus for the Environmental Agreement for the Ekati project is rooted in the problems associated with the public review of the project. Many of the participants questioned the adequacy of BHP's Environmental Impact Statement and the lack of detail concerning BHP's adaptive environmental management strategy to deal with many of the significant concerns around the impacts of the project on caribou, water, fish and other resources. Concerns were raised about the adequacy of the general policy and legislative frameworks in place to deal with complex, large-scale mining projects. The Environmental Agreement was seen as a tool to ensure BHP lived up to the many promises it made both in its EIS and verbally during the hearings before the panel. The Agreement was also viewed as a way to demonstrate an integrated and innovative approach to monitoring and environmental management of the project's effects.
In its EIS, BHP proposed an Environmental Advisory Group for its project made up of four technical experts, two Aboriginal representatives and one person from the general public. This arrangement had been used on another of BHP's mines on Vancouver Island. It was proposed that this Group would prepare an annual overview report of BHP's monitoring programs and results which would be published with an annual environmental assessment report from the company. It was not clear whether the mandate of the Group would include socio-economic monitoring but when pushed on this point, BHP stated that the Group's activities should be limited to environmental matters.
For the reasons mentioned above, there was a lack of confidence in both BHP and government to adequately carry out monitoring programs, publicly report the results and take any corrective action that might be necessary. This uneasiness was shared amongst the Aboriginal, environmental and other non-governmental intervenors. There were two informal stakeholder meetings held outside the hearings on the concept of an independent monitoring group or agency. Without much support from the Panel and given the short time available, there was a only a limited opportunity to explore the concept of a more innovative and rigorous approach to monitoring during the hearings. In any event, there were almost unanimous calls for a monitoring body which would have much more authority than BHP had ever envisioned.
The panel responded to the emerging consensus on independent monitoring in its report by stating:
"The Panel supports the concept of an Environmental Advisory Group. It concludes that the regulatory role of government should not be combined within the advisory role of the group and therefore does not support the suggestion that this group provide a forum for inter-agency cooperation.
The Panel is of the opinion that a separate multi-stakeholder body is not required to manage the monitoring program for this Project. It believes that the responsibility for monitoring must ultimately rest with government and the Proponent.
BHP proposes to produce an annual environmental assessment report which would be made public, and would be accompanied by an overview report by the Environmental Advisory Group. The Panel endorses this concept, and believes that annual reporting is a valuable tool for informing the public and government about progress on the many issues of concern raised during the course of this review. The Panel believes that the annual report should review the results of both compliance and environmental effects monitoring." (Canadian Environmental Assessment Agency 1996, pg. 22-23)
The Panel went on to say that regular reporting should also be undertaken on socio-economic matters and that public meetings should be held to allow for public input into monitoring programs. The Panel also dealt with the considerable public concern around the cumulative effects of the Ekati mine by recommending "periodically BHP should prepare a report that would take a longer view of environmental effects monitoring in the context of natural variability, review the actual performance of Project activities as compared to predictions in the EIS and evaluate how the adaptive management strategy has performed over time" (Canadian Environmental Assessment Agency 1996, pg. 23).
During the August 8, 1996 press conference, DIAND Minister Ron Irwin mentioned that an agreement would be required with BHP similar to several that had been negotiated with mines in the Yukon and for the Norman Wells pipeline project. The Norman Wells Environmental Agreement was signed on September 28, 1982 and lays out a process and requirements for a detailed monitoring program to be developed to help mitigate the effects of the pipeline project. Reclamation plans are also to be developed by the proponent for the approval of the DIAND Minister. This agreement was seen as an innovative tool to supplement the commitments made by the proponent during the panel review of the Norman Wells pipeline. It is a bilateral arrangement directly between DIAND and Interprovincial Pipe Line.
At the above press conference, Minister Irwin also referred to the Institute for Environmental Monitoring and Research, established as a result of the Low-Level Military Flying public review exercise, as a possible model for an independent monitoring agency for the Ekati mine.
On September 23, 1996 DIAND convened a workshop to discuss an environmental agreement for the BHP project. The Aboriginal organizations and territorial government were invited to participate in the discussions. It rapidly became clear that DIAND was stretched very thin on this process and that the Aboriginal organizations did not want to be simply consulted, but demanded direct participation in all the negotiations. DIAND reluctantly gave in but would not allow the Aboriginal organizations to become signatories to the agreement. The legal counsel for the Dogrib Treaty 11 Tribal Council suggested an implementation protocol with Aboriginal signatories as an alternative to ensure that there was direct participation in finalizing the agreement and then implementing it through a funded working group with Aboriginal representation. The protocol and a draft agreement were signed on October 18, 1996 after several furious rounds of negotiation and drafting. A legal and technical review was subsequently carried out by all the parties and the final agreement was signed on January 6, 1997.
It is clear that the Environmental Agreement went well beyond what government and BHP had ever anticipated. It would be fair to say that all parties negotiated in good faith and that significant gains were made in the public interest as a result of the direct participation of the Aboriginal organizations.
Features of the Environmental Agreement
The Environmental Agreement contains provisions dealing with its;
The Agreement is to cover the term of the operation and is to be reviewed annually. DIAND, the territorial government and BHP are all signatories to the Agreement. The goals of the Agreement are as follows:
Several principles also guide the work to be carried out under the Agreement including full consideration of Traditional Knowledge, the precautionary principle, maximization of environmental protection, and the application of adaptive management.
BHP is required to report on annual basis on its environmental compliance, monitoring programs, research, operations and future activities, and remedial or mitigative action. Environmental management plans, including detailed monitoring programs, are required for the construction phase and operations phase. These are subject to the review of government, Aboriginal organizations and the Agency. Further discussion on the Agency is found in a later section.
The Agreement is a legally binding and includes enforcement provisions. BHP is required to post security for the progressive reclamation of the land-related disturbances created by the project. These funds may also be drawn upon if BHP does not comply with other requirements in the Agreement including non-compliance with reporting requirements or failure to rectify faulty management plans.
The Agreement provides a new accountability tool for resource development in the NWT through the public reporting provisions and the track record that is established and thus represents an innovative arrangement.
The Independent Environmental Monitoring Agency
The Implementation Protocol with the Environmental Agreement established a funded working group to oversee the establishment of the Agency. By-laws for the Agency were drawn up by this group, which included Aboriginal representatives, for incorporation of the Agency as a non-profit society in the NWT. Other preparatory work included administrative matters such as office space, staff requirement and related items.
Although the name of the Agency might imply that monitoring is directly carried out, the real function of the Agency is as more of an oversight or audit mechanism. The Agency is responsible for reviewing the design of monitoring programs and results from both government and BHP while examining the environmental management systems in place for their ability to respond appropriately to any problems, whether actual or potential. The mandate of the Agency as set out in the Environmental Agreement is as follows:
The Agency has a seven member Board of Directors. Four are appointed directly by the Aboriginal organizations and the remaining three are appointed jointly by the federal and territorial governments and BHP in consultation with the Aboriginal organizations. The Agency is to report annually. Government and BHP are required to respond in writing to any recommendations from the Agency that they will not implement.
The funding for the Agency for the first two years is to $450,000 each year with BHP contributing $350,000 and the remaining amount split between the two governments. Subsequent funding is to be provided directly by BHP in consultation with the Agency, based on work plans and budgets. Where no agreement can be reached, the matter can be referred to binding arbitration, the only time that the Agency has such authority.
The Agency maintains an office in Yellowknife and has been in operation now for about a year and a half. The first meeting was held in May 1997. The Board of Directors is as follows:
The Board operates independent of the members of the society, the four Aboriginal organizations, Canada, NWT and BHP. The Directors appointed by the Aboriginal organizations make an extra effort to brief and update the leadership in those organizations.
Much of the work in the first year was spent on reviewing the voluminous amount of material submitted by BHP including the Construction Phase Environmental Management Plan, a proposed Aquatic Effects Monitoring Program as required under their water licence, and numerous other proposals and reports. Agency staff and Board members have attended workshops put on BHP and meetings sponsored both by the Agency and government. Further details on the Agencies work over its first year are found in its first annual report (see Independent Environmental Monitoring Agency 1998).
Under the by-laws of the Society, an Annual General Meeting(AGM) is required with the first one held in Yellowknife in June 1998. The annual report of the Agency was presented and there was an opportunity to review general progress and issues to date. Society members were generally pleased with the work of the Agency over the first year. They also expressed the view that the Agency should spend more time in its second year on communications with the communities affected by the project. The Agency has responded by creating a web site, a newsletter and beginning to hold its meetings in the surrounding smaller communities. An issues paper has also been compiled to track the community concerns raised during the panel review and Water Board hearings.
Observations and Lessons Learned
This section will cover the lessons learned to date during the establishment and operation of the Agency and where applicable, suggestions are offered concerning the establishment of a similar Agency for the Voisey's Bay Project. The author is aware that these suggestions may not be particularly appropriate or may require additional thought to tailor them to the specific setting and circumstances found in Labrador.
The Agency has been well received on the whole and has proven itself over the first year. For example, a Director noticed a steep decline in oxygen levels in a lake used for sewage disposal even though the same date were provided to a government department and BHP management. The Agency immediately notified BHP who then took remedial action avoiding a potentially harmful and expensive situation. This issue has also raised questions about the ability of both BHP and government to review and interpret the results of monitoring and should ultimately lead to improved project management.
The Environmental Agreement could not have succeeded without the persistent and skilled intervention by the Aboriginal organizations.
Although there are general provisions in the Environmental Agreement covering cooperation and information sharing amongst the government agencies, BHP and the Agency, considerable time and effort has been spent to establish protocols in this area and in acquiring information.
There has been some confusion over the role of the Agency and how it relates to some of the regulatory processes. This may be a reflection of the need for clearer wording in parts of the Environmental Agreement.
Questions have arisen about the resources required by the Aboriginal organizations for their involvement in the Environmental Agreement processes, including their capacity to review documents produced by BHP, ability to retain independent expertise to assist with technical matters and similar activities.
At the first Agency AGM, there was a healthy debate about the Agency's potential involvement in the environmental assessment of the Diavik Diamond Mines proposal. The Agency is of the view that it can and should make a contribution to this other assessment in light of its mandate to deal with cumulative effects that are likely to spill over into BHP's project and will inevitably affect the same resources impacted by the Ekati mine.
The BHP project has evolved into a different project than what was originally assessed. One of the five pipes to be mined has been switched with a high grade deposit to the north of the camp and another is rumored to be in the running to replace an isolated pipe about 29 km south of the main camp.
The Agency has had some difficulty in obtaining information regarding the on-going and future exploration plans of BHP over their large claims block. In part, this is understandable given the proprietary nature of exploration results but this is useful information in anticipating future development and the requirement for adequate baseline information, and also to gain a better understanding of the cumulative effects of a project.
It is still very early into the work of the Agency and there has not been a specific instance where the Agency has had to exert significant pressure to get action. However, during the negotiation of the Environmental Agreement, some consideration was given for provisions to give the Agency more authority. This is a sensitive area given government's reluctance to assign authority or change legislated mandates.
During the BHP panel hearings, some intervenors supported a monitoring agency having a mandate that would include socio-economic matters. Although there is a socio-economic agreement between BHP and the territorial government, there does not appear to be any rigorous monitoring or communications of results or compliance.
REFERENCES
Canadian Arctic Resources Committee. 1996. Critique of the BHP Environmental Assessment: Purpose, Structure, and Process. Northern Perspectives. 24(1-4): 7-9.
Canadian Institute of Resources Law (CIRL). 1997. Independent Review of the BHP Diamond Mine Process. CIRL: University of Calgary.
Independent Environmental Monitoring Agency. 1998. Annual Report 1997-1998. Independent Environmental Monitoring Agency: Yellowknife, NWT.
O'Reilly, Kevin. 1996. Diamond Mining and the Demise of Environmental Assessment in the North. Northern Perspectives. 24(1-4): 1-4.