City wants at least $8M in Giant Mine clean-up compensation

The City of Yellowknife is requesting a minimum of $8.6 million in water-related compensation from the federally led Giant Mine remediation team.

The former gold mine on Yellowknife’s doorstep is home to 237,000 tonnes of highly toxic mining byproduct arsenic trioxide, all buried underground.

Full remediation of the site is due to begin next year. The work will create hundreds of jobs but involves sealing off some areas potentially for years at a time – including the home of the city’s sailing club and buildings used by the Yellowknife Historical Society.

The City, meanwhile, is spending $34 million on a new water pipe from the Yellowknife River to avoid drawing water from the region around Giant, in case anything goes wrong during the clean-up and arsenic trioxide spills into the bay. (The river is upstream and would, in theory, not be affected by such an incident.)

Anyone whose use of water is affected by the proposed clean-up could file a compensation claim up until August 15 under regulatory legislation.

Documents published to the regulatory registry suggest 27 members of the sailing club (plus the club itself), the Yellowknife Historical Society, and the City of Yellowknife all duly filed claims.

The Mackenzie Valley Land and Water Board gets to rule on the claims and decide appropriate compensation amounts if warranted.

Arguing for millions of dollars in compensation, the City says the planned clean-up operation at Giant would “significantly adversely affect the City’s ability to obtain water from Yellowknife Bay” if there were to be any issues – which means the City, to avoid a potential catastrophe, has to build a new pipeline to the Yellowknife River (replacing one built in 1968 that is reaching the end of its life).

The City is already receiving $25.8 million to pay for some of the water pipe under a federal disaster mitigation fund, having made the same argument: that without the new pipe, Yellowknife’s water source would be a disaster waiting to happen.

That funding was granted in March. Ordinarily, federal funding can only pay for 75 percent of a project with the remaining 25 percent to be found elsewhere.

The City, in an apparent attempted end-run around that rule, is trying to convince the regulator it deserves $8.6 million in compensation for the water source concern. That is the exact sum the municipality still requires to build its water pipe.

If the request is granted, the City would in effect be getting the entire water pipe from federal funding sources. Though the clean-up is co-managed by Ottawa and the territorial government, the remediation costs of $1 billion or more are being met through a federal contaminated sites program.

The City is also claiming, separately, compensation related to its residents’ inability to use the historic Giant Mine town site and nearby sailing facilities during remediation. That claim did not place any predetermined monetary value on the disruption.

“The City’s use of the town site will be suspended from 2021 to 2031, significantly and adversely impacting the social, economic, recreational, and cultural wellbeing of the City’s residents and residents of the Mackenzie Valley more generally,” the second claim reads.

“In order to accommodate and provide facilities for its citizens during that 10-year period of lease suspension, the City will need to make alternate arrangements to compensate for the loss of use of the town site.”

Unsaleable, unsailable

The Yellowknife Historical Society is also claiming compensation associated with loss of access to its site, where it is working to establish a museum and interpretive centre.

The society tells the regulator it has spent more than $1 million to date preparing the site. In a worst-case scenario, the society suggests, it could be due more than $1.2 million in compensation for loss of access, storage space, and income over several years.

Great Slave Sailing Club, which did not identify a specific sum, said it “might be forced to close permanently” as the clean-up work will require that the club’s pier be demolished, the clubhouse and all boats be removed, and access to the site be lost for years. The City is trying to accommodate the sailors elsewhere but nothing is yet certain.

If the club shuts down, its board claims, that would “render many of the boats worthless.”

Almost all of the 27 sailing club members filing for compensation use the same form letter to the regulator, in which they warn the value of their boats has already “been reduced to less than zero due to the uncertainty of whether there will ever be an affordable facility at which to launch.”

The letter states: “It is likely that the large sailboats will become both unsailable and unsaleable.”

The last submission to the regulator comes from the Yellowknives Dene First Nation, which states it will not seek any compensation.

The First Nation says it is waiting for an apology regarding Giant Mine’s effect on its land and people, and will instead await compensation for the much broader overall impact of the mine on its members over many decades.

“We recognize that redress for the most extreme impacts … falls outside of the board’s jurisdiction,” the First Nation wrote.

The opportunity to claim compensation arises as the Giant Mine remediation team is applying for a water licence to cover the vast scope of the clean-up work.

That means to be successful, a claim must show “evidence that a proposed water use or the deposit of waste will adversely or significantly adversely, as the case may be, affect their use of waters.”

Exactly when the regulator will rule on compensation claims is not clear.