Point Lake, a curveball for regulators, clears first assessment hurdle

Plans to dig a new open pit at the NWT’s Ekati diamond mine don’t need an environmental assessment, the Wek’èezhìı Land and Water Board decided, following an application that tests the territory’s legal framework.

Environmental assessments are detailed studies of proposed major projects’ environmental footprints, considered the NWT’s gold standard in regulatory rigour. Mining companies generally try to avoid environmental assessments if possible as they take valuable time and money to complete.

The application from Arctic Canadian, Ekati’s operator, seeks to open a pit at Point Lake on the Ekati site. The pit is critical, Arctic Canadian says, as it will fill a gap in Ekati’s timeline that allows the mine to remain operational for almost four years during which no other mining will be taking place.

In turn, Arctic Canadian argues, that buys time for the company to “design more projects to keep the mine operating.” Those projects are expected to take the form of underwater “remote mining” – a form of semi-automated mining – beneath existing open pits.

To go ahead with Point Lake, Arctic Canadian needs the relevant permitting from the Wek’èezhìı Land and Water Board, the regulator responsible for the region. The board ruled in late August that Point Lake does not need an environmental assessment.

Arctic Canadian’s application attempted to offset some of the impacts Point Lake would create by promising to never develop the Jay project, a separate pit that received permitting four years ago but is no longer considered economically viable.

While a road to the Jay site has been built, little else has been done. Arctic Canadian essentially argues that in scrapping Jay, the company mitigates a lot of Point Lake’s impacts because Point Lake’s environmental footprint fits inside the one Jay was already allowed to create.

Even so, the two projects are different and close scrutiny is being applied to Point Lake’s ramifications for caribou and fish. Caribou have long frequented the Ekati area, while creation of the Point Lake pit requires emptying out the lake itself and the fish within.

‘No clear path’ to reverse old measures

But there’s another problem. In cancelling its ambitions for Jay, Arctic Canadian is proposing that Jay be removed from its water licence entirely.

Arctic Canadian says deleting Jay from the water licence guarantees the company is acting in good faith: it would stop a future owner of the mine using a regulatory loophole to restart the Jay project after Point Lake is mined, despite the company’s present commitment not to do so.

It’s not that simple.

When the Jay project went through environmental assessment, 22 measures were created that must, by law, be followed up on by regulators and government agencies. There is currently no legal process to reverse those measures once they exist.

The Mackenzie Valley Environmental Impact Review Board – which handles the NWT’s environmental assessments and their consequences – must now figure out what to do.

This week, the review board wrote to both Arctic Canadian and the GNWT (which has some responsibility for environmental oversight at Ekati), asking them how some of the Jay measures might be adapted to fit Point Lake.

Otherwise, the review board said in its letters, “there is no clear path in the legislation that allows a regulatory authority to remove conditions that are intended to implement measures from a water licence or other regulatory instrument, or for a government department or agency to not carry out the requirement of a measure to the extent of its authorities.”

The review board says ordinarily a fresh “environmental assessment process of some type” would be needed to remove the Jay measures, but that’s precisely what Arctic Canadian is trying to avoid by pledging never to develop Jay as an open pit, and is what the Wek’èezhìı Land and Water Board just decided won’t have to happen.

The review board does have the power to refer Point Lake to an environmental assessment to solve that conundrum, even though the Wek’èezhìı Land and Water Board has decided such an assessment is not necessary. If that happens, it would be one of the first times – if not the first – that two separate regulators have reached opposing conclusions about the same NWT project.

The issue is a likely topic of conversation at a technical session this week featuring Arctic Canadian, various government agencies, regulators, and the Indigenous governments who collectively hold some oversight of mining at Ekati.

Federal, territorial, and Indigenous government agencies also hold some power to refer Point Lake to environmental assessment, though they ordinarily rely on and feed into the Wek’èezhìı Land and Water Board’s process.

What would Point Lake do?

Even without an environmental assessment, Point Lake must come through a water licence and land-use permit process that assesses how the land, water, vegetation, and wildlife will be disturbed, and what the mine’s operator will do about that.

A public hearing about the proposal is scheduled for November 8-10.

In a presentation, Arctic Canadian says Point Lake is a “short-term development of accessible resources to avoid operations interruption” between 2023 and 2028, keeping hundreds of people employed and Ekati open. (Arctic Canadian stepped in to buy the mine at the start of the year after previous owner Dominion experienced financial trouble.)

Without Point Lake, the company says, Ekati will shut down for good in 2024.

Arctic Canadian says Point Lake doesn’t need new camps or major infrastructure but will create an open pit where Point Lake was, alongside two to three piles of waste rock.

With the NWT’s barren-ground caribou still in desperate straits, Point Lake’s impact on the herd is an important consideration for regulators.

Arctic Canadian says Ekati already has measures in place to help caribou, more caribou crossings will be built, and the removal of the Jay project will reduce the waste rock in the caribou’s path (compared to both Jay and Point Lake being built).

The Wek’èezhìı Land and Water Board says it is “satisfied” effects on caribou will be mitigated.

The GNWT’s Department of Lands wrote that “from a wildlife and wildlife habitat perspective, referral to environmental assessment is not necessary to better understand the residual effects of this development.”

The acidity of waste rock at Point Lake is also a concern, as is the impact on fish both in the lake (for which the development will be terminal) and downstream (where the effects are less certain).

Lastly, Arctic Canadian has faced some criticism for, in the view of regulators, rehashing existing traditional knowledge about Point Lake without getting new input from Indigenous knowledge-holders. The company says that stage is still to come. The regulators say, if need be, stipulations can be placed into the final water licence to ensure that work is done.

While Arctic Canadian has taken pains to emphasize that Point Lake is critical to Ekati’s survival, and the time needed for an environmental assessment would jeopardize the entire mine’s future, that message was not entirely welcomed by regulators.

The Wek’èezhìı Land and Water Board in effect told Arctic Canadian the NWT’s economy and Ekati’s fortunes were not the board’s responsibility, and the board would stick to analyzing the environmental impact.

“Arctic says that the loss of this mine would generate significant adverse socio-economic impacts in the NWT,” the board wrote in its letter declaring it would not refer Point Lake to environmental assessment.

“This may be true. But the board’s responsibility … does not include consideration of the impacts on the [socio-economic] environment of not having the Ekati mine project because of the delays caused by an environmental assessment of the Point Lake project.”

However, the board ultimately concluded that “the proposed changes to the project will not have a significant adverse impact on the environment or be a cause of public concern.”

Only the Independent Environmental Monitoring Agency, which scrutinizes Ekati’s environmental operations, entirely disagreed with that finding.

The monitoring agency said concerns about caribou, waste rock, and the lack of traditional knowledge in the application should have been enough to trigger an environmental assessment. Arctic Canadian said the agency’s reasoning was “flawed.”

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Correction: September 8, 2021 – 8:38 MT. This article initially stated the Point Lake project won’t go to an environmental assessment. While the Wek’èezhìı Land and Water Board hasn’t referred the project to an assessment, the Mackenzie Valley Environmental Impact Review Board could still do so (other agencies also hold the ability to do so, but normally defer to the Wek’èezhìı Land and Water Board’s decision). This report has been updated accordingly.