Thank you for inviting me to be here today. I would like to speak to you about the place of the Northwest Territories in the world and how fostering strong relationships has been, and will continue to be, an important part of promoting social and economic progress in the North.
Before we begin, I would like to take a moment to congratulate Mr. Kujawinski on his appointment as Consul General of the United States here in Calgary. I would also like to note that today marks National Foundation Day in South Korea and also the Day of German Unity. I want to wish our German and South Korean friends all the best on their national holidays. And I would like to offer my best wishes to Ms. Liu Yongfeng and the People’s Republic of China, which celebrated its own national day on October 1st.
The Northwest Territories has a small population of just over 43,000 people living in an area of over 1.3 million square kilometers. That’s bigger than the area of the provinces of Alberta and Saskatchewan combined. The Northwest Territories is home to some of Canada’s most spectacular natural scenery, including two UNESCO World Heritage sites – Nahanni National Park and Wood Buffalo National Park – and three Canadian Heritage Rivers – The Arctic Red River, the Thelon River and the South Nahanni River.
Half of the people in our territory are of Aboriginal descent and maintain a close cultural and spiritual connection to the land. Traditional activities like hunting and trapping are still important to many of our residents. Studies our government has done show that over 70 percent of households in our smaller communities rely on traditionally harvested food.
The Northwest Territories sometimes seems remote and inaccessible. But we have connections to the rest of the world that go back hundreds of years. Europeans have been traveling to the northern parts of Canada since at least the early 1600s. From our earliest contact, the Aboriginal peoples of the North have known and greeted visitors from many parts of the world, including England, France, Denmark, Russia and other nations.
Early on, visitors to our region recognized the economic potential in our abundant natural resources. Initial contact quickly developed into active trading relationships that saw Europeans regularly travelling into the North, living and trading among our people. Northern resources, especially furs, helped to fuel economic growth in Europe, creating wealth and prosperity for its peoples.
Far from being isolated and remote, our region has been an important part of the world economy for centuries now. And while the history of European contact has not always been positive, it is true that our ability to foster good working relationships with people from all over the world has been a key to our own development and prosperity in the Northwest Territories.
As it was centuries ago, the Northwest Territories continues to be a land of great potential and economic opportunity. What began with furs continues today with precious metals like gold, rare earth metals, tungsten, diamonds and oil and gas.
I would like to speak briefly about that potential. The Conference Board of Canada recently reported that Canada’s northern territories will lead the country in economic growth over the next two years. The Northwest Territories’ economy is forecast to grow by more than seven percent in 2012 and 2013 – well above the Canadian average of two percent. With development of the Mackenzie Gas Pipeline, the Conference Board predicts that our GDP will rise to $9.6 billion by 2020.
We have a wealth of mineral potential– gold, diamonds and rare earths. Developing this potential could lead to new mines that will employ hundreds of Northwest Territories residents. Spending on mineral exploration was up by 30 percent last year and is expected to grow again. There are seven projects currently in the works, including Avalon Rare Metals’ Thor Lake project, which is the largest rare earth deposit outside China. Together, these seven projects could attract more than $2 billion in new investment and add over 2000 new jobs in the Northwest Territories.
As the third largest diamond producer in the world we export $2 billion in diamonds annually and have seen increased production at Diavik and Snap Lake. With the Gahcho Kue Mine on the horizon and global demand for diamonds in China and India strong, we can expect this sector to remain an important part of the Northwest Territories economy.
And of course, there is our oil and gas sector. Approximately 16.2 trillion cubic feet of natural gas and 1.2 billion barrels of oil have already been discovered in our territory. This is only a small part of our estimated potential of 81 trillion cubic feet of natural gas and nearly 7 billion barrels of oil. In addition, there are substantial offshore reserves of oil, natural gas and natural gas liquids. Less than a year ago, the federal government issued 11 exploration licenses in the Sahtu representing $534.2 million in work bids for this world class play. And in 2008 industry committed to spend $1.2 billion to develop three offshore leases in the Beaufort Sea. Subsequent bids expanded this to over $2 billion in work commitments.
Our government also continues to support the development of the Mackenzie Gas Project, a project of national significance that could contribute $68 million to the Northwest Territories economy, $86 billion to the Canadian economy and create over 200,000 person years of employment.
The proposed Mackenzie Valley Highway would realize the long-held goal of connecting Canada from sea to sea to sea. It would open up our communities and significantly reduce the cost of exploration and development for industry. We have already committed money to begin work on the Inuvik to Tuktoyaktuk portion of the highway, in partnership with the Government of Canada. We have also worked with Aboriginal and community governments to prepare project description reports for the remainder of the highway for submission to regulators.
But we are not just about the resource economy in the Northwest Territories any longer. The Inuvik Satellite Station is an international partnership that includes the Government of Canada, the Canadian Space Agency, the German Aerospace Centre and the Swedish Space Corporation. These partners have realized that Inuvik is an ideal location for receiving data from remote sensing satellites. We could be world leaders in remote sensing and to support that potential, the Government of the Northwest Territories is looking at options for building a fibre-optic link down the Mackenzie Valley. The Mackenzie Valley Fibre-optic link would improve communications infrastructure in communities along its route, allow researchers and scientists to get real-time data from the Satellite Station and position our residents to become active participants in the growing international digital economy. We are currently looking at financing options for this project, including P3 private sector investments.
We will also continue to support investments in hydro initiatives and alternative energy projects that will help provide lower-cost and environmentally friendly energy to residents and businesses.
Completion of these projects and projects like them can be beneficial to our people and industry alike. They also represent an opportunity for investors and partners from outside of Canada.
It is our northern irony that, in spite of this great potential wealth, we still face huge challenges in the Northwest Territories. Our resources are going undeveloped and our people are still faced with unemployment, poverty, housing and infrastructure challenges and high cost of living. Our residential school experience has left a legacy of mental health and addictions issues and disrupted the family bonds a strong society is based on.
We need to create opportunities for our people to succeed and creating a strong, stable and diversified economy is one of the ways we will do that. Economic development and social development go hand-in-hand. We must develop our economy if we are to develop socially and give our people the opportunity to achieve their aspirations and potential. That will mean development of our natural resources, but it does not mean development at any cost.
Development of our resources has the potential to improve the lives of our residents and make the Northwest Territories a “have” jurisdiction, but it must be managed properly. Development must be sustainable. It must be consistent with our Northern priorities and values. And development must be managed by northerners for northerners.
But we need partners to help us develop our resources to their full potential. The Government of the Northwest Territories does not have the financial capacity to make the investments like infrastructure that we need to keep our economy growing. We need roads to help us bring our resources to market. We need affordable energy supplies to meet the needs of industry and our residents. And we need to develop our communications infrastructure.
Our economic future depends on international trade and investment just as much as it did in the days of the fur trade. We have energy resources that could help meet demand and support economic growth both in Canada and abroad. We have deposits of tungsten and rare earth metals that are necessary to the manufacture of many of today’s high-tech electronics. We have luxury goods like gold, diamonds and wild fur that are in high demand by consumers around the world. Development of these resources would benefit not just Northerners, but would contribute to world economic growth and prosperity as well.
I recently returned from China, where I took part in the successful trade mission organized by the Council of the Federation. China is the world’s second-largest economy and represents a fast-growing segment of Canada’s global trading market. Promoting awareness of Northwest Territories products and resources was a big part of that mission. So was raising awareness of the economic opportunities available in the North. We know that we need to expand markets for Northern goods and we want to encourage other nations to come do business with us. Reaching out to countries around the globe, helping to create relationships that will foster strong economic ties will be one of the key ways that we can grow our own economy and create prosperity for our people and people around the world as well.
In closing, I would like to thank you for your time here today. The Northwest Territories is a land of great economic potential. I would like to encourage you all to come and visit us to learn firsthand about some of the tremendous opportunities that are available to business and investors from around the world and enjoy some of our spectacular scenery and Northern hospitality.
Thank you.