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Territorial and federal governments at odds over Kudz Ze Kayah mine project

The federal government, backed by Liard First Nation, sent the proposal back to the screening stage
Yukon Premier Sandy Silver talks to media on March 5, 2020. The Yukon government said Jan. 25 that it is disappointed in a decision by the federal government to send the Kudz Ze Kayah mining project back to the drawing board. (Crystal Schick/Yukon News file)

The Yukon government says it’s disappointed in a decision by the federal government to send the Kudz Ze Kayah mining project back to the drawing board.

“Following four years of regulatory assessment, this decision creates unreasonable and unnecessary uncertainty for the proponent and sends a troubling signal,” said Premier Sandy Silver, in a statement.

“The Government of Canada absolutely needs to take steps to streamline these processes going forward to ensure greater clarity and certainty for the mining industry,” he said.

The Kudz Ze Kayah project is a proposed open pit and underground zinc, silver, copper, gold and lead mine in the northern Pelly Mountains, 115 kilometres south of Ross River, in the traditional territories of the Kaska, including Liard First Nation and Ross River Dena Council.

On Oct. 12, 2020, the Yukon Environmental and Socio-economic Assessment Board (YESAB) issued recommendations related to the project in a Final Screening Report.

After YESAB issues a report, the project must then be approved by the decision bodies: in this case, the Yukon government, Natural Resources Canada and the Department of Fisheries and Oceans Canada.

The territorial government felt the board’s analysis and suggestions were reasonable to allow the company to proceed, but the federal government felt otherwise.

In a letter detailing the Jan. 22 decision, the government says the screening report produced by YESAB was insufficient.

The decision says more detail is required on how First Nations interests and rights in the project were considered and more information is required on the mitigation measures proposed that intend to protect resources such as water and caribou.

“The FDBs look forward to working with all parties and participants in tackling next steps,” concludes the letter, signed by David Carter, a regional manager in the department of Fisheries and Oceans Canada and Rinaldo Jeanty, a director general within Natural Resources Canada.

In his statement, Silver said the Yukon was prepared to accept the recommendations and proceed, but the federal government’s decision means “we cannot issue a decision document accepting the recommendations at this time.”

The project has undergone four years of review since BMC Minerals took it over in January 2015.

The mine is planned to operate for a minimum of nine years, according to BMC, producing an estimated yearly average of 106,800 tonnes of zinc and smaller amounts of copper and lead concentrates. The project tailings will be stored either underground as cemented paste fill or in a dry-stacked tailing facility on the surface, according to the company.

Liard First Nation leadership has opposed the project in its current form. In a letter to the decision bodies following the YESAB committee, Chief Stephen Charlie recommended that the project be rejected or referred to a public panel.

In his letter addressed to ministers, Charlie writes that the report recommends the governments “proceed with mitigations despite a clear, well-documented and significant harms to Kaska Aboriginal rights, including Aboriginal title.”

Ross River Dena Council (RRDC) has not provided a similar letter to the government regarding the latest decision. In 2019 the First Nation council completed their own independent environmental assessment review.

In the most recent correspondence submitted to YESAB from the RRDC, on Jan. 14, 2020, Chief Jack Caesar wrote “Ross River Dena Council is pleased with the positive relationship we have established and are continuing to develop with BMC Minerals Ltd., particularly as concerns the KZK project.”

Caesar noted that “discussions and negotiations” were ongoing, including the support of Elders in the community and specific concerns such as the Finlayson caribou herd.

Chief Caesar was not immediately available for comment on the most recent development.

BMC Minerals representatives said the decision by the federal government was unexpected, but they are committed to working with the Kaska to see the mine move into the next stage.

“We are a little surprised with the federal questions that are coming after the process was completed. We think the questions they’ve asked probably could have been asked at the draft decision document stage in 2019,” said Allen Nixon, BMC Minerals’ vice president of external affairs.

“It puts some uncertainty into our short-term plans for sure, and potentially our longer-term plans,” he said. “We’re just looking forward to seeing the end of this stage of the process so that we can enter into the permitting process.”

Contact Haley Ritchie at