Lawyer says Alberta consult plan could make benefits agreements harder

Sunday, 28 October 2012 08:00 Bob Weber, The Canadian Press

EDMONTON – An Alberta government proposal to regulate how energy companies negotiate benefits agreements with aboriginal bands could make it harder to work such deals out, says a lawyer whose firm assists in such talks.

A discussion paper, released by the government last week, suggests that a levy should be applied industry-wide to help bands pay for the work involved in setting up such deals.

It also suggests reversing current practice by recommending that all such deals be made public. That could deter companies from entering into them at all, said Neil Reddekopp.

“The confidentiality is generally a request of our industry partners and it’s something that our clients agree to,” said Reddekopp, whose firm is currently helping about six bands negotiate benefits agreements with energy companies. “I have a hard time seeing this call for disclosure as anything more than an indirect way of discouraging this type of agreement.”

Energy companies frequently negotiate so-called community benefits agreements with aboriginal bands on whose traditional lands they wish to operate. The deals may include cash for community purposes, promises of local employment, environmental agreements or dispute settlement mechanisms.

They are not intended as compensation, said Reddekopp.

“What they’re doing is assisting communities deal with massive changes forced on communities.”

Making such deals public would allow bands to point to other settlements during negotiations, something that would effectively create a tariff, said Reddekopp.

He said the situations are too individual to benefit from standard settlements and throwing other examples into the mix during talks would just confuse matters.

“There would be more information,” said Reddekopp. “Whether there would be more understanding is another question.”

Alberta Aborginal Relations spokesman David Dear said the disclosure proposal is part of an overall plan to bring the secretive benefits negotiations process into the open.

“We thought this made a lot of sense,” he said. “It just adds clarity and honesty around the process.”

He said the proposal to fund the negotiating of such agreements through an industry levy is intended to replace the current practice, where individual companies are asked to make up shortfalls in provincial funding.

Instead, the levy would be assessed evenly throughout the industry and paid out to bands by the government on the basis of need.

Industry wouldn’t be paying more money in total, but the burden would be more evenly spread, said Dear.

Dear acknowledged both ideas came from government and weren’t being requested.

Reddekopp said the government is trying to make benefits agreements harder to reach as a way of discouraging industry from entering into them. Some, he said, view those deals as a form of “ransom.”

The Canadian Association of Petroleum Producers said it’s still reviewing the government proposals.

“Industry is interested establishing consistency, clarity, and fairness in aboriginal consultation matters associated with oil and gas projects,” said vice-president David Pryce in an email. “The paper will be reviewed by CAPP and our members and we will constructively contribute to the discussion over the coming weeks.”

The public consultation period on the proposals will close on Nov. 30.