Silver risks irrelevance on offshore exploration ban

There was some bad news for the Yukon’s long-term constitutional development while you were sipping eggnog and decorating the Christmas tree.

There was some bad news for the Yukon’s long-term constitutional development while you were sipping eggnog and decorating the Christmas tree.

Apparently without consulting the Yukon, the federal government declared a ban on new drilling licences in the Yukon offshore, as well as the rest of the Canadian Arctic. The ban will be reviewed in five years. It was announced in conjunction with the outgoing Obama administration’s similar ban for much — but not all — of the Alaska offshore.

Obama left 2.8 million acres offshore between Barrow and the Arctic National Wildlife Refuge available for drilling. This zone is close to existing oil infrastructure on the North Slope, making it relatively more easy to exploit than the farther offshore zones. Alaska’s Republican senators and representative were nonetheless livid about the ban, and promised to work with the incoming Trump administration to try to roll it back.

Yukoners of all political stripes — and all attitudes to the oil industry — should be concerned by Ottawa’s unilateral move. Even if you are against oil exploration in the Arctic, or think the economics will never make sense, the federal move is a setback to the Yukon’s self-government.

Indeed, why have 28.3 times more MLAs per capita than British Columbia if you don’t ask them their opinion about something as important as the future of the Yukon’s offshore. A federally appointed executive commissioner like we had in the days before self-government can take direction from Ottawa a lot more cheaply than a premier and 18 MLAs.

Under the Canadian constitution and the tangle of federal deals that have accumulated with provinces and territories over the years, jurisdiction over the offshore is a complex playground for lawyers. In the Yukon’s case, the feds are responsible for the offshore zone. But, according to the Yukon’s Department of Energy, Mines and Resources, the 1993 Canada Yukon Onshore Oil & Gas Accord included interim arrangements for Yukon involvement in governing the offshore. These included commitments by the feds to involve us in “all aspects of shared offshore management” and to start negotiations for shared offshore administrative and legislative responsibilities.

More recently, in 2008, the feds signed an agreement which, according to EMR, outlines the “Yukon’s enhanced role in offshore oil and gas management.”

The new federal announcement is legal, but not consistent with the spirit of these commitments or the Yukon’s position as a self-governing territory.

The N.W.T. and Nunavut governments, which are in a similar situation, immediately protested. “We are concerned by the announcement and firmly believe northerners should be involved in making decisions that affect them and their economic future, and in this instance, they weren’t,” said N.W.T. Premier Bob McLeod.

McLeod told CBC: “We spent a lot of time negotiating a devolution agreement, and we thought the days were gone when we’d have unilateral decisions made about the North in some faraway place like Ottawa, and that northerners would be making decisions about issues that affected northerners.”

He also put the move in a broader political context: “We live here, we want to protect the environment… In order to appease opposition to resource development in the south, they’re looking at using the North to put in protected areas and stopping development.”

Nunavut Premier Peter Taptuna told CBC the ban could “cripple Nunavut’s future financial independence.”

Unlike the N.W.T. and Nunavut premiers, and Alaskan representatives, Yukon Premier Sandy Silver made no public comment about the issue for two weeks.

Indeed, it was not until asked about it last week by newshounds from this paper that he commented. He told the News that there wasn’t “a lot of dialogue” between the feds and the Yukon prior to the announcement.

Apparently he received a call from Ottawa a couple hours before the announcement informing him about it. “I expressed my concern at that time that we had not been involved in this decision and that unilateral decisions for the North are obviously not something we support,” he said.

At this point, it’s not clear how strongly he put this message across, or what he did to protect the rights of the Vuntut Gwitchin First Nation to be consulted.

His public silence for two weeks while other northern leaders were talking to their citizens is puzzling. If he is not careful, the opposition will start criticizing him for valuing loyalty to the federal Liberal Party above his duty to fight for Yukoners’ interests.

Some, who think diplomacy and avoiding difficult conversations are the same thing, are probably advising him not to annoy Ottawa. But in the husky-eat-husky world of federal-provincial relations, nice guys get ignored.

Indeed, he played nice at the last First Ministers’ meeting by signing onto the communique despite the lack of concrete commitments for exemptions for the Yukon’s export-dependent mining industry or compensation for carbon taxes paid by Yukoners on goods produced in carbon-pricing provinces or shipped here through them.

In return, he woke up one morning to a phone call from Ottawa warning him at the last minute about a unilateral announcement.

To salvage the situation, he needs to call “offside” loudly and clearly to Ottawa. One option is that, in the ongoing carbon pricing negotiations with Ottawa, we make the point that forgoing our offshore oil potential is a major contribution to preventing climate change. Activists keep calling for oil to stay in the ground, and here are potentially huge oilfields that will be kept off the market.

A feisty defender of Yukon interests would use this contribution to push for economic development funding to replace the lost oil opportunities, as well as the mining exemption and compensation for carbon taxes we pay to the provinces as mentioned above.

The Yukon needs to stand its ground here. Rights that are not defended are soon lost, as the old saying goes. And even Yukoners who are pleased there won’t be drilling in the Arctic should think about how strong our negotiating position will be if Silver does nothing now, and some future Conservative government in Ottawa unilaterally re-opens the Arctic for drilling.

Keith Halliday is a Yukon economist and author of the MacBride Museum’s Aurore of the Yukon series of historical children’s adventure novels. He is a Ma Murray award-winner for best columnist.