Bob McLeod: Arctic Oil and Gas Symposium 2019 Keynote - Purgatory and persistence: The case for economic self-determination in the Northwest Territories'

March 13, 2019
Ministers' Statements and Speeches

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Good morning,

I see a lot of familiar faces in the room this morning. In fact I’ll bet many of you have heard me speak before about the importance of oil and gas development in the North.

I remain committed to the future of this country and of the Northwest Territories, but as I come to the end of my second term as Premier of the Northwest Territories I have to say, my patience is wearing thin.

In November of 2017, I issued a public call to action, a “Red Alert” about the state of the NWT economy and my very real fears about what was going to happen if the Federal government and others did not pay immediate attention to the NWT.

These fears are not just my own. They are shared by families who are struggling with high costs of living and fewer prospects for good paying jobs.

These fears are being echoed by industry and our business community who want to stay and grow in the North but are being forced to make tough decisions as they feel left out from the national economic equation.

I’m pleased to say that since issuing the Red Alert we have seen increased investment by the Federal government, particularly in vital infrastructure that will help drive future economic development. 

I took a lot of flak for issuing the Red Alert, both domestically and nationally.

There are still those who believe that a mostly positive message about the potential of the NWT is what I need to be reinforcing.

So I’ll say this today, there is tremendous potential for oil and gas activity in the NWT, transformative potential for the NWT and Canada. But potential is only as good as the actions are to unlock it and to turn it into opportunities.

You’d think that the relationship between resource development, and socioeconomic wellbeing would be well known in this country.

Yet our Canadian media is filled with stories about what we as Canadians have been conditioned to see as a battle between good and evil when it comes to natural resource development. 

The middle ground, is sustainable responsible development, which isn’t flashy or controversial. It is, however, where our future as a country lies and the Northwest Territories is the key for the future of resource development in our Canadian economy.

Depending on who you talk to, the Government of the Northwest Territories is either too focused on resource development, short sighted and in the pocket of some amorphous big-business, or we are obstructionist, naïve and entirely too “green” to attract investment. 

The complicated truth is that the NWT is somewhere in the middle.

Complicated truths aren’t always what southern, urban Canadians want to think about when they think of an untouched, unspoiled and sparsely populated northern Canada.

But our northern reality is complicated, and I’m not prepared to give up a prosperous future for our residents without a fight just because Canadians are forgetting about their own complicated pasts.

There is no question that provinces in this country have each, at some point in time, benefitted from Federal government investment meant to bring value nation-wide.

Railways, ports, bridges, hydro dams, highways, and pipelines across this country would not exist without the Government of Canada making good on the promise of Federalism.

Now is the time for that same promise to be fulfilled in the Northwest Territories; it’s time for the federal government to show that it trusts and values the NWT to bring economic value to Canada.

The Red Alert was issued for a reason, and I can say here today that yes, its’ message is now being understood in Ottawa.

Since taking over his new portfolio Minister LeBlanc has made it a priority to better understand and support the Northwest Territories, and we have seen some encouraging results to advance our territory’s priorities.

Those priorities are centered mainly on closing an infrastructure gap and making the kinds of investments in energy and transportation that the majority of Canadians take for granted.

Three priority projects have been the heart of our efforts with the Government of Canada.

An all-weather road connection into the mineral rich Slave Geological Province region would greatly improve economic opportunities in the NWT.

This road will lower the cost of exploration and development in one of our country’s most promising mineral regions, and lay the groundwork for an eventual all-weather connection to the Nunavut boarder.

It is literally a road to riches.

The Taltson Hydroelectricity Expansion project would be a game changer. With up to 200 megawatts of electrical generation potential, the Taltson project proposes a phased approach that would connect our two existing hydro systems to one another and increase power generation by an additional 60 megawatts.

Clean energy would supply existing mines and residents with affordable and green electricity, and would support new projects in the mineral rich Slave Geological Province region and elsewhere.

Not only would Taltson allow NWT residents to benefit from one of its great renewable resources, but it would reduce greenhouse gas emissions by up to 240 thousand tonnes a year.

If fully developed to its 200 megawatt capacity, the Taltson project could connect to the southern electrical grid, which would provide another green energy source to meet national energy needs and create a revenue generating opportunity for the territory and Indigenous government partners.

The third priority infrastructure project for the Government of the Northwest Territories is to deliver on the long promised dream of an all-weather Mackenzie Valley Highway.

This highway will run the length of the NWT along the Mackenzie River, connect communities to one another, and to the NWT to the rest of Canada.

It would also reinvigorate the oil and gas sector, making the world class reserves an attractive investment opportunity.

This includes the already permitted Mackenzie Gas Pipeline, which is the only fully permitted pipeline in the Country.

As permitted pipelines in this country take on more and more symbolic meaning for those who do not want them built, I want to talk about the MGP as a cautionary tale.

It took close to a decade for the federal process to get the permits in place for a project that had Indigenous involvement and ownership right from the start.

The pipeline would have moved cleaner fuels, provided economic development and jobs for the people of the Beaufort Delta and all down the Mackenzie Valley.

But you, as well as anyone, know the story. It didn’t happen.

The market didn’t wait for the permitting process and I have to say, the market had every right to move on. This was a waste of an opportunity that the whole country could be benefitting from today.

Some of my provincial Premier colleagues talk about resources land locked by overly complicated management regimes, as I have.

Truth be told, landlocked is polite.  When you see your communities suffering from poverty and no opportunities on the horizon, it feels more like being held hostage.

As I said, we have seen movement in the right direction from the Government of Canada on our priority areas.

Collectively our governments have pledged $1.2 million to support Indigenous engagement as the first steps of the Taltson project, and $140 million for projects to advance the Mackenzie Valley Highway. 

We are also receiving $5.1 million for two projects to support planning an all-season Slave Geological Province road.

So if you’re doing the math that is a grand total of $146 million. And we are happy to have the investment and the commitment it seems to move forward.

However, these projects need significant capital investment. What has been committed to, is a start. But it will require a focused and sustained effort on all fronts to make sure we don’t miss yet another opportunity.

Part of responsible sustainable development is doing it on a timeline that works for the people of the territory. We are going to keep pushing to see these projects realized sooner than later.

We are going to take action where we can to make that happen now, and not in another 30 years.

Governments’ responsibility is to set up our residents for success.

Success for the Northwest Territories means telling our own story, making our own decisions and for Southern Canadians to hear, listen and respect that.

All too often I have seen a narrative being played out in our institutions, media and governments that keeps Indigenous people in a certain frame. One where we are only valued as responsible stewards of their land if they choose not to touch it. This is eco-colonialism.

It is a form of colonialism that dictates that different rules apply to different peoples.

If Indigenous groups don’t align themselves with a green partner, they cannot be trusted to make the right decisions about their land, for their people, and about their future. 

Despite the narrative being played out on our screens and through social media platforms, it is oppressive and irresponsible to assume that Indigenous northerners do not support resource development.

In the Northwest Territories we have been collectively – Indigenous and non-Indigenous – making decisions about resource development since the 1920s.

Beginning with the discovery of oil and gas in the Sahtu region, resource development has helped shape the political and cultural self-determination of our Indigenous peoples for close to 100 years. Followed by gold and diamonds, the modern history of the NWT is one that goes hand in hand with resource development.

In the decade since the global economic recession, the Northwest Territories remains the only jurisdiction in Canada that has yet to recover.

From a high of over $5.6 billion in 2007, our GDP in 2017 was still close to $800 million less than it was then. Our neighbours to the east and west – Yukon and Nunavut – have increased their GDPs in the hundreds of millions and even billion dollar ranges during that same time.

Prior to the recession and a decline in commodity prices that I know has concerned you all, resource development made up almost half of the Northwest Territories economy – 45 percent in 2007.

While this sector remains the single largest GDP contributor to our economy, it is nowhere as big as it was and is 2017 was only 37 percent.

Unfortunately, it is the oil and gas sector that has taken the biggest hit.

This sector, which once generated so much wealth and promise for our residents, contributed just $8 million to the Northwest Territories  economy in 2017.

It is now one of our smallest sectors, on par with sectors like agriculture and arts and entertainment. This is a far cry from the more than $800 million oil and gas contributed to territorial GDP in a peak year like 2001.

What makes this ironic is that the Northwest Territories remains one of the only jurisdictions in Canada, and even in North America, where the local social license, that investors and developers want and need to confidently invest, exists.

This isn’t something that I’m just saying, this is a fact.

I continue to work to build our government’s relationship with Indigenous governments in the Northwest Territories. This includes bringing governments together for a high-level economic symposium to talk about the challenges facing the NWT economy.

At this two-day meeting in Inuvik last year, we publically reaffirmed our collective commitment to resource development as being the most significant component of the NWT economy. We agreed to work together to do everything we could to support its growth in our territory.

Think about that for a moment.

Our population of nearly fifty percent Indigenous and fifty percent non-Indigenous people share a broad consensus to not only support, but to take action and to encourage responsible resource development.

Are you seeing that kind of social license in the rest of Canada? 

Getting to this place did not happen by accident. It came as a result of strong leadership from all sides and decisions reflecting our commitment to rights, recognition and respect.

The NWT has six settled Indigenous claims and is actively participating along with the Government of Canada at 14 other negotiating tables right now.

The GNWT has created one of the richest revenue sharing agreements of its kind in Canada, sharing up to 25 percent of resource revenues directly with Indigenous governments.

Our government also maintains formalized government-to-government relations with Indigenous governments and invests in strong relationships with Indigenous organizations.

On the mining side, we have seen more than $4.3 billion in direct contracting for Indigenous-owned business with our diamond mines since 1996.  We have also experienced more than 9,400 person years of employment for Indigenous NWT residents as a result of this commitment.

This is what real reconciliation looks like.

Its multiple levels of government – public, Indigenous, municipal and local – agreeing to work and partner together to create the economic, political and cultural future that all our residents deserve.

It’s about not sitting idly by and waiting for the Federal government say how and when we get to benefit from the natural resource wealth we share.

It is about sending the message to southern Canada that it is time to invest in the territories the same way that that they have invested in the provinces in past.

It’s about saying no to eco-colonialism and about making sure that decisions that affect the Northwest Territories are made by us.

Being able to pass and administer our own management regime was one of the reasons that our government negotiated devolution of responsibility for public lands and resources from the Government of Canada five years ago.

For our part, the GNWT recently introduced a new Petroleum Resources Act and an Oil and Gas Operations Act that move us closer to natural resource independence.

If passed, this new legislation will mark a crucial first set of changes that will create a made-in-the-north regime for oil and gas development in our territory.

They will modernize language and processes, enhance transparency and accountability and allow us to engage in discussions on how Significant Discovery Licenses for oil and gas should be managed in the NWT.

We have also introduced the first ever Mineral Resources Act in the NWT.

Like our proposed oil and gas legislation, the Mineral Resources Act was developed after years of public engagement, research, collaboration with Indigenous governments and organizations and input from industry and stakeholders.

These three legislative initiatives are part of ongoing work by the GNWT to establish and strengthen a modern management regime for natural resources that will allow Northwest Territories residents to make the decisions about their own economy and future.

We are also keeping our eye on the ball when it comes to national legislative changes.

Too often in the Northwest Territories, and in the North in general, we have seen a lack of understanding of the full range of consequences of decisions that are made thousands of kilometres away in Southern Canada.

This was certainly the case when in 2016 the moratorium on new offshore oil and gas licenses in the Arctic was announced. We are still experiencing this today on major files that impact the rights and livelihoods of the Dene of the Mackenzie Valley.

When the moratorium was first announced by Ottawa, we once again saw how decisions about the Northwest Territories being made unilaterally in Ottawa could affect our economic future overnight.

I remember what it was like to sit on the sidelines of discussions around our oil and gas future when the Mackenzie Valley Pipeline made its way through a painfully slow system of approvals that resulted in too little too late for our territory.

This was a painful lesson that factored into my decision to issue the Red Alert.

Onshore and offshore petroleum resources in the NWT represent an enormous source of economic potential and wealth for our residents and for our country. We believe that they can and should be developed safely and responsibly.

Rather than erecting obstacles to development, our government believes we should be working on the policy and science needed to manage responsible development, and will continue to advocate for this.

The fact remains that the natural resource sectors of mining, and oil and gas, has been, and will continue to be, the engine of the NWT economy. The same can be said of most northern economies.

While our government has been investing in, and seeing promising results from, other sectors like tourism and agriculture, these sectors cannot compare to the overall contributions to GDP that our natural resource sector will continue to provide.

If we broaden the scope from beyond the visible disparities between the experiences of southern Canada and those in our northern territorial communities, to look at the amount of emphasis and investment our circumpolar neighbours are placing in their Arctics, this issue becomes even more dire.   

In a world where our Arctic Neighbours are pouring investments into Arctic infrastructure, economic development and militarization, Canada is an empty land mass. 

Without strategic investments in energy and transportation infrastructure and a commitment by the federal government to meaningful Arctic economic development, there is a future where Canada is at risk of being left behind.

We need and want a plan that includes focused and deliberate investment in high priority areas like Taltson, the Mackenzie Valley Highway and a road to the Slave Geological Province.

These energy and transportation projects are specifically aimed at growing the NWT economy and transforming the future prospects of our residents.

And I am here to say that the Northwest Territories wants to be a national economic driver, and we need you to help us get there.

There are signs that this is beginning to be understood by the rest of Canada, and in particular by the current federal government.

In 2018, the Government of Canada signaled that it was prepared to do right by Northerners and begin negotiating management and revenue sharing process with the governments of the Northwest Territories, Yukon and the Inuvialuit Regional Corporation.

They have committed to us that we will be part of the five-year review of the moratorium and understand that responsible natural resource development, including offshore resources, is a right and responsibility that Northerners deserve to benefit from. 

Minister LeBlanc, who is speaking here tomorrow, was instrumental in helping us get to this stage.

The commitments from the Federal government so far have been great first steps, and I look forward to more good news for the Northwest Territories when the federal budget is tabled later this month.

Friends, the message I want to leave you with today is, that what we are doing in the NWT is paying dividends.

We have found a way to work together with all levels of government to create an environment that is ripe for natural resource investment.

We will continue to invest in our relationships, and work at home, and we are ready, willing and able to nurture, invest in, and support life changing resource development projects.

The Northwest Territories is ready to be a national economic driver, and now is the time to join us.

Thank you.