University of Calgary PRISM: University of Calgary's Digital Repository Graduate Studies Master of Public Policy Capstone Projects 2015-09 An Analysis of Land and Resource Management Devolution in the Northwest Territories McLauchlan, Sydney McLauhclan, Sydney. (2014). An Analysis of Land and Resource Management Devolution in the Northwest Territories ( Unpublished master's thesis). University of Calgary, Calgary, AB. http://hdl.handle.net/1880/51643 report Downloaded from PRISM: https://prism.ucalgary.ca MASTER OF PUBLIC POLICY CAPSTONE PROJECT An Analysis of Land and Resource Management Devolution in the Northwest Territories Is Evolution needed prior to effective Devolution? Submitted by: Sydney McLauchlan Approved by Supervisor: Ted Morton Submitted in fulfillment of the requirements of PPOL 623 and completion of the requirements for the Master of Public Policy degree Table of Contents Executive Summary ...................................................................................................... 4 Introduction ................................................................................................................... 6 Part 1: Demographics, Devolution History and Current Governance Structure in the Northwest Territories .............................................................................................. 9 1.1 Demographics .................................................................................................... 9 1.2 Devolution History and Current Structure ........................................................... 9 1.3 Facts and Financial Figures ............................................................................. 12 1.4 Regulatory Changes ......................................................................................... 13 1.5 Governance Structure ...................................................................................... 14 1.6 Bill C-15 Critique .............................................................................................. 15 Part 2: Challenges Facing the Northwest Territories’ Energy Development ........... 24 2.1 Cost and Access to Energy Challenges ............................................................ 26 2.2 Transportation and Distance to Market Challenges .......................................... 31 2.3 Social Challenges............................................................................................. 36 2.4 Land and Environmental Challenges ................................................................ 38 2.5 The Opinion Paradox of Resource Development in the NWT ........................... 39 Part 3: Federal Government Initiatives ...................................................................... 41 Part 4: Policy Recommendations ............................................................................... 44 4.1 Continuation of Long-Term Infrastructure Planning/Funding and Consider Alternative Energy Sources. ................................................................................... 44 4.2 Build Future Capacity and Transferable Skills .................................................. 46 4.3 Increase the Accountability and Efficiency of the GNWT’s Information Management System ............................................................................................. 49 4.4 Encourage Private Sector Partnerships with Aboriginal Businesses ................. 50 4.5 Restore Public Engagement through Land Use Planning Initiatives ................. 52 4.6 Renewable Energy Consideration for Remote Communities ............................ 53 Part 5: Conclusions ..................................................................................................... 54 Appendices .................................................................................................................. 56 Bibliography ................................................................................................................ 59 3 Executive Summary On April 1st 2014 in the most recent round of Devolution, the Federal Crown transferred jurisdictional responsibility, management and decision-making power to the government of the Northwest Territories (NWT). Under this Devolution, the NWT now controls its onshore public lands, water and natural resources. This is a significant moment in the Territory’s history, analogous in some respects to the grant of province- hood to Alberta and Saskatchewan in 1905. This transfer gives the NWT greater financial and political autonomy and new access to revenues through royalty payments. Ultimately, the Territory is given the potential to become a “have jurisdiction” in Canada, instead of a “handout”. In anticipation of future resource development, this paper identifies and analyzes challenges that create barriers to oil and gas development, and provides recommendations to inform future policymakers. Although there has been a major initiative by the Federal Government in recent years to promote prosperity and autonomy in the North, the challenges that face this jurisdiction are substantial. Roadblocks to development range from public backlash to Bill C-15—the Northwest Territories Devolution Act, to significant economic, social, aboriginal, and geographic challenges in the region. Through extensive analysis of scholarly articles and government publications, short and long-term solutions are recommended to the Government of the Northwest Territories (GNWT), Industry proponents, and residents of the NWT. These include: Greater investment in legacy infrastructure Decrease the cost of energy for citizens, as well as proponents of new businesses Grant greater flexibility to complete secondary education in the Territory 4 Promote financial partnerships and job-training opportunities between private companies and aboriginal governments Restore public engagement through Land Use Planning Initiatives The future success of the Territory as well as the industry will depend on addressing the challenges as a coordinated strategy, instead of individual problems and solutions. However, the question remains whether the administration and citizens of the Northwest Territories are adequately prepared and willing to accept sustained resource development, now that they maintain the jurisdictional authority to control it. Future potential in the Northwest Territories is high, but the resources and subsequent prosperity for the region will “stay in the ground” if public support for oil and gas development is not implemented into the solution. 5 Introduction The Canadian North has historically been a mystery to most Canadian residents living south of the 60th parallel. The Arctic Territories were often perceived as vast, isolated and underdeveloped, habitually cold and lacking financial opportunity. However in the past several years, topics in the media featuring arctic sovereignty, Aboriginal rights, improved scientific technology, and renewed interest to develop northern hydrocarbon resources have captured the attention of Canadians “South of 60”: “The Arctic is in a period of massive transformation. The impacts of climate change, resource development and geopolitical realities are all coming together in a manner that we don’t yet understand fully, but we know it is transforming the Arctic.” –Robert Huebert (Centre for Military and Strategic Studies University of Calgary)1 Another factor that has begun to alter Canadians’ indifference toward the Northern Territories is the advocacy efforts of Prime Minister Steven Harper. In 2009, Harper published Canada’s Northern Strategy: Our North, Our Heritage, Our Future, which describes the Federal Government’s activities and investments in the Northern Territories to promote prosperity, and the subsequent importance of the Territories’ success for the rest of Canada. Along with protecting Canadian sovereignty and environmental heritage, Harper’s strategy emphasizes the importance of fostering social and economic growth in the Territories by promoting the responsible extraction of oil and gas. Resources such as fresh water, oil and gas, minerals, and diamonds represent a major source of economic activity and exploration in the Canadian North. It is estimated that 1 Policy Horizons Canada. “Canada’s North: Overcoming the Challenges to Leverage the Opportunities” Canada150. 70. 2010. Web. http://www.horizons.gc.ca/sites/default/files/Publication-alt- format/can150_rp-eng.pdf 6 roughly 13 percent of the world’s undiscovered oil, and 30 percent of its undiscovered gas lies under the Arctic seabed.2 In order to unlock resource potential without compromising environmental protection, Our Northern Strategy asserts that improvements must be made to northern regulatory regimes. Thus in 2010, the Federal Government unveiled plans to streamline the regulatory process, which included removing barriers to private investment, enhancing environmental stewardship, and investing in programs to support economic growth and provide opportunities for Northerners.3 The most significant action by the Federal government thus far is the commitment to devolve more jurisdictional power in order to give the Territories greater control of their economic and political outcome. The transfer of this power has had a duel effect: increased the autonomy of the Territory to promote prosperity and growth, and encouraged government responsiveness and efficiency at the sub-national level.4 On April 1, 2014 the GNWT became responsible for the administration and control of onshore lands and