Appendix 16-A Socio-economic Baseline Report KEMESS UNDERGROUND PROJECT Application for an Environmental Assessment Certificate Prepared for: KEMESS UNDERGROUND PROJECT Socio-economic Baseline Report August 2015 The world’s leading sustainability consultancy AuRico Metals Inc. KEMESS UNDERGROUND PROJECT Socio-economic Baseline Report August 2015 Project #0196303-0012 Citation: ERM. 2015. Kemess Underground Project: Socio-economic Baseline Report. Prepared for AuRico Metals Inc. by ERM Consultants Canada Ltd.: Vancouver, British Columbia. ERM ERM Building, 15th Floor 1111 West Hastings Street Vancouver, BC Canada V6E 2J3 T: (604) 689-9460 F: (604) 687-4277 ERM prepared this report for the sole and exclusive benefit of, and use by, AuRico Metals Inc. Notwithstanding delivery of this report by ERM or AuRico Metals Inc. to any third party, any copy of this report provided to a third party is provided for informational purposes only, without the right to rely upon the report. EXECUTIVE SUMMARY AuRico Metals Inc. (AuRico) proposes to develop the Kemess Underground Project (the Project), an underground gold-copper mine located in north-central British Columbia (BC). The Project is located approximately 250 km north of Smithers, 430 km north-northwest of Prince George, and 6.5 km north of the past-producing Kemess South (KS) Mine, which is currently under care and maintenance. The Project is situated on provincial Crown land within the Peace River Regional District and is accessed from the Omineca Resource Access Road; Mackenzie is the closest town by road to the Project and is located approximately 300 km southeast of the Project. The Project is located in the traditional territories of the Takla Lake First Nation (TLFN), Tsay Keh Dene Nation (TKDN), and adjacent to the traditional territory of the Kwadacha Nation. This report describes the prevailing socio-economic conditions for the seven communities and regional districts that comprise the socio-economic study areas. Study area communities considered in this report are referred to as Potentially Affected Communities (PACs) and include four incorporated municipalities and three Aboriginal communities, all within the province of BC. The three Aboriginal communities are Kwadacha, Tsay Keh, and Takla Landing. The municipalities are Mackenzie, Prince George, Smithers, and Terrace. The regional study area (RSA) is defined by the regional districts of Peace River, Fraser-Fort George, Bulkley-Nechako, and Kitimat-Stikine. As typical of economies tied to natural resource industries, the populations of the PACs have both risen and fallen over the past two census periods (Section 4.3.2 and 4.4.4). Services and economic opportunities are typically focused in the larger service centres of the region, including Prince George, Smithers, and Terrace. A relatively high proportion of PAC populations identify as Aboriginal in comparison to the provincial average; in other words, Aboriginal people comprise a relatively large proportion of the population of communities near the proposed Project. Population data and trends for the PACs indicated that they have relatively young populations and low rates of population growth, in comparison to the province (Statistics Canada 2012). The Aboriginal communities of Kwadacha, Tsay Keh, and Takla Landing are the closet communities to the Project by air. Road access is limited to unpaved forest service roads, up to 400 km long (approximately 12 hours travel time) in the case of Kwadacha; as such, air access is important, although it can be limited in poor weather. These communities have relatively small populations (in the range of 200 to 300 people) and local education, employment, and health services are limited and typically based in larger centers. Prince George is the largest community and main service centre for northern BC, and includes a full range of hospital, educational and other services. Smithers and Terrace are also regional service centres, and are hubs for logistics, transportation and other services related to mining and other resource industries throughout northwestern BC. Unemployment in the remote Aboriginal communities is generally high (above 20%) and job opportunities are limited and often seasonal. However, the respective First Nations are working to develop local economic capacity and opportunities, and members from these First Nations have a AURICO METALS INC. i SOCIO-ECONOMIC BASELINE REPORT history of employment with the Kemess South mine (which represented a source of training and employment during its operation), as well as exploration during 2013 and 2014 1. A high proportion of PAC residents have experience in trades, and this reflects the regional resource-based economy and available employment opportunities. Apprenticeship and trades certificates are notably more common in the PACs (30 to 35%) in comparison to the provincial average (19%). Correspondingly, employment in trades, transport and equipment operations as well as in the natural resources and agriculture sectors were generally higher in the PACs (Section 4.7.3). Community access to health, social, and emergency services varies by community. In the Aboriginal PACs, there are fewer services and facilities. Residents rely, at least in part, on scheduled visits from health care professionals and transport (as needed) to larger service centres. However, the First Nations are working to develop programs suited to the needs of these communities and incorporating traditional approaches to healing and wellness. Programs include cultural camps and youth programs, support for local Elders, developing nutrition and healthy lifestyles, and counselling services. A broader range of services, including emergency services are available in the larger PACs, including Prince George, although the Northern Health authority reports that regional health services are operating at or beyond capacity. 1 Recent employment of members of the Kwadacha Nation, TKDN, and TLFN has included: in 2013, 17 TKN people were employed by Project exploration activities, and two were employed as seasonal environmental monitors at the KS mine; and in 2014, there were 21 TKN people were employed by Project exploration activities and two were employed as seasonal environmental monitors at the KS mine (Craig, S. pers. comm. 2015). ii ERM | PROJ #0196303-0012 | REV C.1 | AUGUST 2015 ACKNOWLEDGEMENTS This report was produced for AuRico Metals Inc. by ERM. It was written by Heather Henley (M.N.R.M., B.A. Hons.), Klaudia Sieminska (M.A.), Maurice DePaoli (B.A., CAHP). Technical review and guidance was provided by Anna Sundby (M.Sc.). Mark Branson (M.Sc.) is the Project Manager and Korina Houghton (B.Sc.) is the Project Coordinator. Anne Currie (B.A., MPA) is the Partner-in-Charge of the Project. AURICO METALS INC. iii KEMESS UNDERGROUND PROJECT Socio-economic Baseline Report TABLE OF CONTENTS Executive Summary ............................................................................................................................................ i Acknowledgements .......................................................................................................................................... iii Table of Contents ............................................................................................................................................... v List of Figures ...................................................................................................................................... xi List of Tables ........................................................................................................................................ xi Glossary and Abbreviations ..........................................................................................................................xiii 1. Introduction ....................................................................................................................................... 1-1 1.1 Project Description .............................................................................................................. 1-1 1.2 Project Location and Setting ............................................................................................... 1-1 1.3 Project Proponent ................................................................................................................ 1-2 1.4 Objectives .............................................................................................................................. 1-2 1.5 Baseline Study Areas and Potentially Affected Communities ...................................... 1-2 1.5.1 Provincial Study Area ........................................................................................... 1-3 1.5.2 Regional Study Area (RSA) .................................................................................. 1-3 1.5.3 Potentially Affected Communities ...................................................................... 1-3 2. Legislation, Regulations, and Guidelines ...................................................................................... 2-1 2.1 Local and Regional Context ............................................................................................... 2-1 2.2 Provincial Context ............................................................................................................... 2-2 2.3 Federal Context .................................................................................................................... 2-2 2.4