Canada: SCC Denies Tsilhqot'in Nation Appeal In Taseko Dispute

Last Updated: August 20 2019
Article by Mining Prospects, James Clinton and Colton Dennis

Most Read Contributor in Canada, August 2019

On June 13, 2019, the Supreme Court of Canada denied leave to appeal of a dispute between Taseko Mines Ltd. ("Taseko"), the Province of British Columbia and the Tsilhqot'in Nation relating to the Province's permit approval for Taseko to perform exploratory drilling.

Background

The dispute has its origins in the efforts of Taseko to obtain approval for a mining development known as the Prosperity Project. Under the proposed Prosperity Project, Taseko planned to develop an area 125 km southwest of Williams Lake, BC, in which it owned a mineral lease and mineral claims. Taseko claims that the area contains an estimated 11 million ounces of gold and four billion pounds of copper. At the Supreme Court of Canada in 2014, the Tsilhqot'in Nation had established legal rights to hunt and trap in the area (2014 SCC 44).To commence work on the Prosperity Project under provincial and federal legislation, Taseko had to obtain provincial and federal approval. Obtaining such approval would include satisfying to the provincial and federal governments that the Prosperity Project did not have significant adverse impacts on Aboriginal rights in the area.

In 2009, the Province of BC completed an environmental assessment of the project and concluded that the Prosperity Project would not have significant adverse impacts on Tsilhqot'in hunting and trapping activities and would have only minimal impacts on Tsilhqot'in fishing rights. Taseko was able to obtain provincial approval for the Prosperity Project in January 2010 in the form of an environmental assessment certificate.

However, Taseko was not able to obtain federal approval at that time. In July 2010, the federal environmental assessment panel examining the Prosperity Project found that it would have significant adverse effects on fish and fish habitat, grizzly bears, navigation, the current use of lands and resources for traditional purposes by the Tsilhqot'in Nation, Tsilhqot'in cultural heritage, and on proven and asserted Tsilhqot'in Aboriginal rights. In response to this rejection, Taseko undertook efforts to modify the project to address the panel's concerns.

Taseko's adaption efforts were broad and included substantial accommodations. For one, Taseko proposed a new plan for the Prosperity Project that would preserve Teztan Biny, a mountain of cultural and spiritual significance to the Tsilhqot'in Nation. This new Prosperity Project plan was rejected by the federal government. In a press release that accompanied the rejection, the Minister of Environment stated that the federal government "invite[d] the submission of another proposal that addresses the Government's concerns".

Taseko also took steps to ensure the process that the federal panel followed in considering the Prosperity Project was fair. In November 2013, Taseko applied for judicial review of the federal panel's process and report. The Federal Court dismissed Taseko's application, but the Federal Court of Appeal is now considering the case and has not released a decision as of the date of this post.

While working to obtain federal approval, Taseko took the necessary preparations to explore the area. In September 2011, Taseko obtained provincial approval to perform exploratory drilling work. After agreeing with the Xeni Gwet'in First Nations Government and the Tsilhqot'in Nation, Taseko carried out the exploratory drilling that had been approved. Additionally, Taseko obtained a five-year extension of the provincial approval of the provincial original Prosperity Project, giving it until January 2020 to substantially start work on the Prosperity Project. The approval will expire after that date.

In 2016, Taseko applied for another exploratory drilling program. This time, however, Taseko was unable to gain Tsilhqot'in Nation support, despite the fact that Taseko had advised the Tsilhqot'in Nation of its application and met with Tsilhqot'in technical staff to provide detailed information about the drilling program. Taseko told the Tsilhqot'in Nation in October 2016 that it was committed to working constructively with the Tsilhqot'in on the drilling program. It also carried out a lengthy consultation program in tandem with the Province of BC after submitting the application for the drilling permit. In April 2017, however, the Tsilhqot'in Nation advised the Province that in its view the drilling project should not be approved.

While it did account for the Tsilhqot'in Nation's concerns, the Province took a different view of the project than the Tsilhqot'in. The Province decided in July 2017 to approve the new drilling program. The Province's Senior Inspector of Mines, Richard Adams, approved the application subject to 37 mitigation conditions, and noted that he had considered the concerns of the Tsilhqot'in Nation in making this decision. The Tsilhqot'in Nation and the Xeni Gwet'in First Nations Government, represented by Chief Roger Williams, disagreed with the decision and applied for judicial review.

Court Decisions

The BC Supreme Court was the first court to consider the matter, and it dismissed the Tsilhqot'in Nation's application, concluding that the Senior Inspector of Mines' decision was reasonable. The Supreme Court recognized that the Province owed the Tsilhqot'in Nation a deep level of consultation, but was satisfied that the Senior Inspector gave due regard to the Tsilhqot'in Nation's concerns. The Supreme Court added that provincial officers need not defer to separate assessments made under federal statutes in making their decisions. Finally, the Supreme Court held that the Senior Inspector did not err in considering Taseko's January 2020 deadline to begin substantial work on the Prosperity Project in his decision, and that the Senior Inspector had other valid reasons for approving the 2016 drilling program. The Tsilhqot'in Nation appealed this decision.

The BC Court of Appeal upheld the Supreme Court of BC's decision, dismissing the Tsilhqot'in Nation appeal. The Court of Appeal agreed that the Province owed the Tsilhqot'in Nation a deep level of consultation, and stated that the core question was whether the Province had breached its duty to consult and accommodate and its duty to act honourably in approving the 2016 drilling project. The Court of Appeal noted that the Senior Inspector had devoted 14 pages of analysis in his decision to the concerns of the Tsilhqot'in Nation, thus taking into account the Tsilhqot'in Nation's positions. The Court also held that the Senior Inspector's reasons provided a satisfactory explanation for his decision, and that while the 2020 substantial start deadline was a collateral issue, it was one that the Senior Inspector was entitled to consider. Finally, the Court of Appeal found that the Senior Inspector's decision was substantively reasonable. The Tsilhqot'in Nation appealed this decision to the Supreme Court of Canada.

The Supreme Court of Canada denied the Tsilhqot'in Nation's application for leave to appeal, meaning that the BC Court of Appeal decision stands. Taseko is therefore permitted to begin new exploratory drilling efforts to gather geological and engineering data with hopes of advancing the Prosperity Project towards federal approval.

Conclusion

Taseko cannot currently begin work on the Prosperity Project, but is in a better position having had its new exploratory drilling program approved. Taseko only holds provincial environmental approval for the original Prosperity Project, and not for the amended project plan developed to try to get federal approval. This provincial approval for the original Prosperity Project will expire in January 2020 should Taseko not substantially start work at that time. Taseko does not have federal approval for the new Prosperity Project, but it is challenging the rejection of the federal environmental assessment panel at the Federal Court of Appeal. If Taseko were to be successful on appeal, it may be entitled to have its application for the new Prosperity Project reconsidered by the federal government. Taseko will also need a provincial mine construction permit under the Mines Act to begin work on the Prosperity Project.

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