What happens when a mining company jumps through all the hoops and still gets shut down?
Well, people lose their jobs, that's what happens. It's a simple fact that should be obvious to everybody but apparently not the Mackenzie Valley Land and Water Board.
The board denied a water licence for TerraX minerals last month, effectively scrapping its winter drilling program and putting 50 people out of work.
It was only a few weeks ago that TerraX announced that exploration work around the old Ptarmigan Mine site found high-grade gold, raising the possibility of the of gold mining might return to the Yellowknife area. When Ptarmigan closed in 1997 the price of gold was at $250 per ounce. Now it's $1,310 per ounce.
A higher gold price will go a long way to make gold mining in the North viable again but it won't matter if junior companies are strangled in the crib by overzealous regulators who prioritize red tape over jobs and the economy.
TerraX, in a detailed 27-page response to the land and water board, outlined and answered all questions asked of it. The Department of Fisheries and Oceans (DFO), which initially raised concerns about the drilling program's effects on fish and fish habitat, withdrew its objections after TerraX detailed how much water it would draw and how.
DFO sent a letter to the board Jan. 24 stating it was satisfied there would be no serious harm to fish and that Fisheries Act authorization was not required for the project.
Yet, good faith intentions be damned, the land and water board threw TerraX's water licence application back to public review, despite all the information it had received, and regardless of DFO's blessing for it.
What does that say about this process? From our perspective, it says mineral resource companies and other job providers operating inside the land and water board's jurisdiction can dot their Is, cross their Ts, do everything they can to ensure they are following the rules but, at the end of the day, political appointees sitting in an office somewhere can decide that's not good enough and then stick their project on a shelf.
It says to other resource companies don't set up shop here because the complaints about the NWT's regulatory regime are true, that the rules – and the rulers who administer them – are capricious and arbitrary.
It says to everybody else, including people tempted to try and make a life here despite the high cost of living and all the other challenges, that there is a lot of uncertainty and it might be better to think about moving somewhere else.
The land and water board is an important institution that protects the lands and waters within its jurisdiction. The people on its board and its regulators, including its executive director, former Yellowknife city councillor Shelagh Montgomery, do important work protecting areas where Indigenous land claims are still unsettled, but it appears – at least in this case – that the board has lost sight of the impact its decisions can have on ordinary people who want to live and work here.
There are people who were counting on the TerraX project to provide them paycheques through the winter, and now they will have to do something else to make ends meet – if they still can.
The environment is important but so are people. The Mackenzie Valley Land and Water Board, if it wishes to enjoy public confidence in its decisions, must consider both in its decisions.
Otherwise, people are likely to think “the process” is broken.