Chief Allan Adam of the Athabasca Chipewyan First Nation is accusing the Alberta government of racism.
“The Alberta government has never ever put a red light on any projects that are being put forward by any major corporation or company in regards to oil and gas development. Because it’s the First Nations that come up with one, this is the only known project that was ever given the red light. They put a stop on this,” said Adam. “The province of Alberta is racist to the First Nation people and it just goes to show that they will never ever sit down at the table at the First Nation level in regard to moving forward.”
In February, the Alberta government announced that after months of discussions between Teedrum Inc. company representatives and their partner First Nations, the Alberta First Nation Energy Centre would not be receiving funding under the Bitumen’s Royalty In-Kind program.
Bart Johnson, spokesperson for Alberta Energy, said the proposal will not be negotiated further nor would the government take into consideration Teedrum Inc. president Ken Horn’s suggestion for a third party to conduct an independent assessment review.
“Minister (Ted) Morton, following discussions with the Premier’s Office, did meet with them and let them know we are not prepared to proceed on it now. There are just too many uncertainties,” said Johnson.
“I’m absolutely surprised (by the decision). It was not expected at all,” said Horn, who noted that not only had he and his team had over 30 meetings with government bureaucrats, but the project had the support of former Premier Ed Stelmach and a number of ministers.
Although a conditional commitment had been “drawn up,” said Johnson, it had not been signed.
According to the AFNEC website, the Alberta First Nations Energy Centre is an initiative of Enoch Cree Chief Ron Morin on behalf of all First Nations and Teedrum Inc. The $6.6 billion oil sands upgrader would process 125,000 barrels per day of bitumen from the tar sands into synthetic crude oil, diesel, jet fuel and other products. The refinery is to be located in Lamont County on approximately 1,700 acres in the area referred to as the Industrial Heartland, Canada’s largest hydrocarbon processing region with over 40 oil and gas companies operating there. The state-of-the-art facility would be capable of expanding to 300,000-barrel-a-day production, primarily for export.
Although most oil and gas companies have policies in place that employ Aboriginal people, this upgrader would be the first directly owned by First Nations.
“The proposal could have offered potential economic benefits to First Nations but that’s as it was presented. But we don’t have enough information to determine if there’s any validity to the proposed benefits because they have not done enough front end work,” said Johnson.
He said Teedrum is short on both partnership commitments and financial commitments. The company has provided only $20 million in advanced engineering work, has not acquired land to locate the refinery, has not acquired regulatory approval, and has not signed agreements with partners.
“The level of uncertainty with the project was just too high. It would have required government and therefore taxpayers to take on an unacceptable level of risk,” said Johnson.
Horn refutes the government’s claims saying the agreement Teedrum is looking for is “conditional in nature and there was no risk to the Crown. In fact, all the risk was put back on us. We had a two-year period to do a number of things (to meet) 13 conditions.”
As far as economics, he said, Teedrum had work undertaken that showed the project was viable.
Horn is hopeful that Teedrum will be able to get the government back to the table.
“It’s a big blow. These large megaprojects around the globe certainly need some participation by government,” said Horn.
In the meanwhile, Horn said Teedrum will look to China and India for support in the project, noting that relationships have been cultivated with both countries already.
“This is a critical time,” he said. “There are a number of investors and there’s the availability in pipelines…. To keep a project of this size and staff and everybody moving is difficult.”
Johnson said the government’s refusal to support the First Nations’ refinery is not connected to First Nations’ opposition to either Northern Gateway pipeline or Keystone XL pipeline developments.
“I imagine somewhere in their decision they make reference to that but I’m not going to comment on it,” said Adam.