Deadline looms for pipeline revenue deals

Seventeen First Nations including near Terrace, B.C. struggle to divide as much as $30 million, says Kitselas chief councillor Joe Bevan

Seventeen First Nations spread over nearly 1,000 kilometres across northern B.C. are struggling to divide as much as $30 million in annual payments from the provincial government should three pipelines carrying natural gas from the northeast to liquefied natural gas plants on the coast ever be built.

An original deadline of June 30 has now been extended to Dec. 31 as the First Nations consider a series of detailed options over how much each First Nation should receive.

Each of the proposed pipelines – Coastal GasLink to Kitimat for the planned LNG Canada liquefied natural gas plant, Prince Rupert Gas Transmission to the Prince Rupert area for the planned Pacific NorthWest LNG plant and the Westcoast Connector to another planned LNG plant at Prince Rupert – would provide affected First Nations with $10 million a year in provincial payments.

The province originally said it would step in and make decisions on how to divide the money should the First Nations not reach agreements for each pipeline route by June 30 but is now giving them more time to come up with their own formula.

All three gas pipelines would pass through Kitselas traditional territory and Kitselas First Nation chief councillor Joe Bevan calls the negotiations exceedingly difficult.

Time frames are short with complications based on the number of kilometres each pipeline would stretch through each First Nation’s territory while some question whether they want pipelines constructed at all and some neighbouring First Nations have overlapping territorial claims.

Bevan said meetings continue this month and that ten different formulas tailored for the three agreements will be put to a vote of the chief councillors representing the First Nations whose territories would be crossed.

These formulas range “right from equal shares all the way down to length of pipe, impacts, or even divided by half… half of one that gets divided equally and then the rest gets divided per impact [on a First Nation’s territory],” said Bevan.

“So there was a lot of suggestions … [but] there has been no decision.”

The original June 30 deadline was based on having six months to reach an agreement, said the provincial government in a statement.

“It was just decided at the time that it really wasn’t the best route, and [we] wanted to let the First Nations keep working at it,” said a statement from the provincial aboriginal relations and reconciliation ministry.

Bevan said that given the fact it took around three years for a group of First Nations to negotiate a separate agreement for the Pacific Trails Pipeline which would feed natural gas to the Chevron-associated Kitimat LNG project, the original six-month timeline for the other three pipelines was short.

And even having a year is challenging, he said.

Bevan did acknowledge there are examples to follow in that some individual First Nations have already signed separate benefits agreements with the province providing money leading up to the construction, completion and starting operations  of the gas pipelines.

Bevan said gathering all of the chief councillors in one room to work out how to share the annual provincial payments has also been a challenge.

“We tried to get everybody together and say that yeah, here is a day that works, but of course we only get half the attendance, so I said at some point we are going to have to make a decision and like it or lump it, we have to make a decision. If you guys can’t make a decision then we will make a decision.”

Bevan also said that some chiefs have wondered if all negotiations between themselves is premature considering the time line for companies to make final decisions is lengthening.

“Quite honestly I am looking at this and saying, is it real or is it not. Right now, it’s kind of a mute point if there is no [final investment decision] now,” he said.

Several companies have moved decision dates from this year to 2016, said Bevan, which would make the Dec. 31 deadline an appropriate but challenging deadline to meet.

The deals being negotiated are independent of any separate financial arrangements agreed to between pipeline companies and First Nations.