The Government of Canada will begin negotiating a Beaufort Sea oil and gas co-management and revenue-sharing agreement with the Northwest Territories, Yukon, and Inuvialuit Regional Corporation.

The action, seen as overdue by the Government of the Northwest Territories, comes after sustained territorial criticism of the federal moratorium on oil and gas development off Canada’s Arctic coast.

NWT Premier Bob McLeod has rounded on the moratorium more than once, memorably issuing a “red alert” in November 2017 in which he said: “The promise of the North is fading and the dreams of northerners are dying as we see a re-emergence of colonialism.”

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During his August visit to Yellowknife, Dominic LeBlanc – the new minister for northern affairs – hinted he would have “something positive to say about a path forward” on oil and gas in the near future.

On Thursday, the federal government published a news release committing to the negotiation of a Beaufort Sea oil and gas co-management and revenue-sharing agreement.

The Northwest Territories argues Ottawa essentially promised the same thing five years ago during Devolution talks.

“It was supposed to happen within 60 days of signing Devolution,” Industry Minister Wally Schumann told Cabin Radio. “Now, the federal government has made the commitment to move that forward.

“It’s probably going to be rolling out sooner than later. This is welcome news.”

In a statement, Premier McLeod called the announcement “concrete progress.”

“The GNWT has been waiting for today’s announcement for some time and I appreciate that Minister LeBlanc, in his role as the minister responsible for northern affairs, has been able to make tangible progress.”

LeBlanc, in the federal news release, said: “During extensive consultations, our partners were very clear: they want to be involved in the management of Arctic offshore oil and gas resources, and they want to see economic prosperity and jobs that will benefit Indigenous peoples and all northerners in the future without affecting the health of their environment.”

Economy ‘depends on this’

A co-management agreement all but certainly advances the NWT’s push to end the current moratorium on offshore oil and gas development introduced by the Trudeau government, given the territory’s stated aim of benefiting from the resumption of such development.

“The strength of the Northwest Territories economy and the wellbeing of its residents depends on the sustainable development of its natural resources,” continued McLeod in his statement.

“That includes the responsible development of the NWT’s significant onshore and offshore oil and gas resources.”

Schumann told Cabin Radio: “The moratorium is staying in place for the full five years [till 2021] from the day it was announced, then there will be a review. Through negotiations, I think the Premier is hoping that will be looked at in a little better light.

“We think oil and gas can be done safely up there. It’s been proven in the past. The federal government took the position they did; now they have come forward to negotiate the co-management and that’s a question that will be asked of them.”

McLeod expects the promised negotiations to begin “in the coming months.”

In its news release, the federal government also pledged to:

  • “freeze the terms of the existing licences in the Arctic offshore to preserve existing rights, remit the balance of any financial deposit related to licences to affected licence holders and suspend any oil and gas activities for the duration of the moratorium;” and
  • “work with northern partners to co-develop the scope and governance framework for a science-based, life-cycle impact assessment review every five years that takes into account marine and climate change science.”

Arctic framework

The federal announcement follows this week’s three-day economic symposium in Inuvik, at which the territorial government, Indigenous governments, and the Kátł’odeeche First Nation agreed to form a working group “to identify economic opportunities and concrete next steps” for the territory.

Holding such a symposium has been a long-held ambition of the territorial government as a statement of intent, both of its desire to kickstart the economy and to demonstrate a collaborative approach.

Duane Smith, chair of the Inuvialuit Regional Corporation, told the CBC such a meeting was “long overdue.”

The working group will come together at the same time as the territorial and federal governments work on an Arctic policy framework – a boring-sounding but vital development for the future of the North.

The framework will “reorganize and reprioritize federal activities in the Arctic,” in Ottawa’s words, by defining how Canada approaches issues like northern infrastructure, the economy, the environment, and partnerships with territorial and Indigenous governments.

Both LeBlanc and McLeod have made great play of the impact the framework will have on the North, and intergovernmental relations, once finished and implemented.