Canada: Mining And Aboriginal Consultation In The Yukon – by Roy Millen and Monika Sawicka (Mondaq.com – January 20, 2014)

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Blake, Cassels & Graydon LLP

Mining and Aboriginal Peoples are both significant aspects of life in the Yukon. The territorial government recently amended its mining legislation to require consultation of Aboriginal Peoples before exploration programs are undertaken. The Yukon Supreme Court also recently quashed the government’s approval of a proposed mining exploration project. These legal developments provide a timely reminder of the importance of undertaking proper processes in developing, financing and acquiring projects in First Nations’ territory.

BACKGROUND

Mining in the Yukon is governed by the Placer Mining Act and the Quartz Mining Act. Both statutes have been amended in response to a December 2012 decision of the Yukon Court of Appeal in Ross River Dena Council v. Government of Yukon.

As described in our Blakes Bulletin: Duty to Consult Fosters Change to Yukon Mineral Claims Regime, the Court of Appeal held that the Yukon government’s open entry registration system for quartz mineral claims is subject to the Crown’s duty to consult with First Nations. The Quartz Mining Act allows an individual to acquire mineral rights by simply staking and recording a claim. Under the former regime, the holder of the mineral claim would then be able to undertake a Class 1 exploration program, which includes activities such as the clearing of land; the construction of lines, corridors and temporary trails; the use of explosives; and the removal of subsurface rock. All of this activity could be undertaken without the tenure holder providing notice to the government and without obtaining permission from, or consulting with, any person, including First Nations.

The Ross River Dena Council applied to court for a declaration that the government had a duty to consult before recording a mineral claim under the Quartz Mining Act. The Court of Appeal held that the Quartz Mining Act must allow for accommodation of First Nations before their aboriginal title or rights are adversely affected. Mere notice of a newly recorded quartz mineral claim is not sufficient consultation. Accordingly, the court issued declarations regarding the duty to consult, but suspended its ruling for one year to allow the government to consider legislative changes to provide for appropriate consultation. On September 19, 2013, the Supreme Court of Canada dismissed the government’s application for leave to appeal.

LEGISLATIVE AMENDMENTS

The territorial government recently adopted statutory and regulatory amendments to address the court ruling. Bill 66 amends both the Quartz Mining Act and the Placer Mining Act. The bill provides that, within any designated area, a Class 1 exploration program cannot be undertaken until the government has consulted with each affected First Nation, and determined whether any adverse effects on the First Nation’s interests can be appropriately mitigated. So far, the government has only designated Ross River as an area where these consultation requirements apply.

The process for consultation under the new regulatory scheme is as follows. First, the proponent must give the chief of mining land use (Chief) notice of the proposed exploration program (Notification). Next, the Chief has a 25-day review period during which to initiate consultation with each affected First Nation and determine whether the exploration program will appropriately mitigate any adverse effects on the First Nation’s rights. If so, the Chief may allow the exploration program to proceed. Conversely, if the Chief determines that the exploration program will not appropriately mitigate these adverse effects, the Chief may reject the program or allow it to proceed on conditions.

Interestingly, if the Chief does not make a decision on a proposed exploration program during the 25-day review period, it appears from the legislation that the proponent may proceed with the program upon the expiry of the review period. It is uncertain whether this is the government’s intention or simply a gap in the legislative scheme.

The government has indicated that details of which activities require Notification will be addressed early in 2014. In addition, the government issued an interim order prohibiting mineral staking in the Ross River Area until May 1, 2014.

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