The Peel is not Windy Craggy

Premier Darrell Pasloski's doom-and-gloom prediction that preserving the Peel Watershed would bankrupt the territory is based on one big assumption. It's that the push to protect a vast swath of northeast Yukon is similar to the Windy Craggy saga that played out in British Columbia nearly two decades ago.

Premier Darrell Pasloski’s doom-and-gloom prediction that preserving the Peel Watershed would bankrupt the territory is based on one big assumption.

It’s that the push to protect a vast swath of northeast Yukon is similar to the Windy Craggy saga that played out in British Columbia nearly two decades ago.

But there are big problems with this comparison. Put them all together, and it’s hard to escape the conclusion that the premier is vastly overstating the cost of protecting the Peel.

Most importantly, Windy Craggy was well on its way to becoming a massive copper mine when the BC government encircled it with Tatshenshini-Alsek Park in 1993.

This led to the mine company, Geddes Resources, receiving a payout of $29 million. The province spent another $138 million to help build another mine elsewhere.

RELATED:Read all of our election coverage.

But no mineral play in the Peel is anywhere near as advanced as Windy Craggy was at the time. “Therein lies the distinction,” said Richard Schwindt, professor emeritus of economics at Simon Fraser University.

He should know. Schwindt’s the guy the BC government hired to craft a compensation deal for Windy Craggy.

The Peel’s most-lauded deposit is Chevron’s massive Crest iron deposit along the Snake River.

But the Crest deposit doesn’t have proven reserves or a modern feasibility study. Both are needed for a company to make a strong case for being paid foregone profits, said Schwindt.

And Chevron hasn’t explored Crest since the early 1960s. It’s unlikely that the company would be compensated for that work done that long ago, and even if it were, that would cost less than $500,000.

There are other important differences between Windy Craggy and Crest. To be viable, Crest needs a 1,000-kilometre rail line stretching to Haines, Alaska. Cost estimates for this stretch upwards of $11 billion.

Chevron once hoped governments would foot much of the bill. But, as both Canada and the United States retrench after the global financial crisis, this now seems extremely unlikely to happen any time soon.

Power is another big problem for Crest. Being so far from the Yukon’s grid, and from potential hydroelectric projects, the only realistic electricity source is an extremely dirty one: a coal-fired plant, fed by the Bonnet Plume’s coal seams.

Schwindt doesn’t buy the line advanced by the NDP and conservationists that no compensation is owed to mineral exploration companies with properties frozen by a ban on building roads.

Their claims may not, strictly speaking, be expropriated, but the effect is the same.

But exploration outfits ought to only be compensated for their documented costs, up to a relatively short cutoff point, said Schwindt. He recommended that the BC government only pay exploration companies for work done in the preceding five years.

It would cost $40 million to reimburse mining exploration companies for their expenditures in the watershed from 2005 to 2008, when the bulk of staking was done.

That’s far less than the “hundreds of millions” of dollars that Pasloski has predicted. But it’s still a lot of money.

It would cost far less if the territory set an earlier cut-off date, or if payments are discounted for companies that rushed in to stake claims after the planning process started.

And, as conservationists and opposition parties note, cash payments aren’t the only solution, although Schwindt sees it as the tidiest.

When the Fishing Branch and Tombstone territorial parks were created, companies with claims were negotiated with on an individual basis.

Some companies simply gave up their claims. Others swapped their claims for credit for exploration work elsewhere. Some probably received cash – how much isn’t publicly known.

None fought acrimonious court battles.

The cost of Windy Craggy itself is sometimes overstated, said Schwindt. The total deal was worth $167 million, but much of the money went to the construction of publicly owned infrastructure like power lines and roads, as well as job training.

“When you look at it, it wasn’t that the government got held up,” said Schwindt.

In the end, this payout wasn’t based on Schwindt’s plan. “There was no really clear explanation as to how the government had come up with the amount of money it had come up with,” he said.

There’s a lesson to be learned, both from Windy Craggy and from the current Peel dispute, said Schwindt. That’s the need for clear rules set out for compensation for mineral claims that are either expropriated or otherwise stranded by protected land.

If such rules were in place before the Peel planning began, they may have prevented the staking rush that ensued.

“Make it clear so that capitalists can predict what’s going to happen in certain events. Then you don’t get into this sort of mess, where people flock to the problem.”

But rewarding exploration outfits for more than their costs would send the wrong message, said Schwindt.

“If you insure homes in a floodplain for floods above the cost of the creation of the dwelling, people will flock to the floodplain,” he said.

“If people believe that government is going to start compensating on speculation of that mineral reserve, it’s the floodplain story.”

There’s nearly 9,000 mineral claims in the Peel. Much of this is of the Yukon Party government’s own making, when it ignored recommendations to ban staking in the area once the planning process started. Predictably, stakers rushed in.

Now, Pasloski is pointing to these claims as one of the big reasons why the Peel shouldn’t be protected.

Contact John Thompson at

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Children’s performer Claire Ness poses for a photo for the upcoming annual Pivot Festival. “Claire Ness Morning” will be a kid-friendly performance streamed on the morning of Jan. 30. (Photo courtesy Erik Pinkerton Photography)
Pivot Festival provides ‘delight and light’ to a pandemic January

The festival runs Jan. 20 to 30 with virtual and physically distant events

The Boulevard of Hope was launched by the Yukon T1D Support Network and will be lit up throughout January. It is aimed at raising awareness about Yukoners living with Type 1 diabetes. (Stephanie Waddell/Yukon News)
Boulevard of Hope sheds light on Type 1 diabetes

Organizers hope to make it an annual event

City of Whitehorse city council meeting in Whitehorse on Oct. 5, 2020. An updated council procedures bylaw was proposed at Whitehorse city council’s Jan. 18 meeting that would see a few changes to council meetings and how council handles certain matters like civil emergencies. (Crystal Schick/Yukon News file)
Whitehorse procedures bylaw comes forward

New measures proposed for how council could deal with emergencies

A Yukon survey querying transportation between communities has already seen hundreds of participants and is the latest review highlighting the territory’s gap in accessibility. (Crystal Schick/Yukon News file)
Multiple reports, survey decry lack of transportation between Yukon communities

A Community Travel survey is the latest in a slew of initiatives pointing to poor accessibility

Mobile vaccine team Team Balto practises vaccine clinic set-up and teardown at Vanier Catholic Secondary School. Mobile vaccine teams are heading out this week to the communities in order to begin Moderna vaccinations. (Haley Ritchie/Yukon News)
Mobile vaccine teams begin community vaccinations

“It’s an all-of-government approach”

A file photo of grizzly bear along the highway outside Dawson City. Yukon conservation officers euthanized a grizzly bear Jan. 15 that was originally sighted near Braeburn. (Alistair Maitland/Yukon News file)
Male grizzly euthanized near Braeburn

Yukon conservation officers have euthanized a grizzly bear that was originally sighted… Continue reading

Mayor Dan Curtis listens to a councillor on the phone during a city council meeting in Whitehorse on April 14, 2020. Curtis announced Jan. 14 that he intends to seek nomination to be the Yukon Liberal candidate for Whitehorse Centre in the 2021 territorial election. (Crystal Schick/Yukon News)
Whitehorse mayor seeking nomination for territorial election

Whitehorse mayor Dan Curtis is preparing for a run in the upcoming… Continue reading

Gerard Redinger was charged under the <em>Civil Emergency Measures Act</em> with failing to self-isolate and failing to transit through the Yukon in under 24 hours. (Joel Krahn/Yukon News file)
Man ticketed $1,150 at Wolf Creek campground for failing to self-isolate

Gerard Redinger signed a 24-hour transit declaration, ticketed 13 days later

Yukon Energy, Solvest Inc. and Chu Níikwän Development Corporation are calling on the city for a meeting to look at possibilities for separate tax rates or incentives for renewable energy projects. (Crystal Schick/Yukon News file)
Tax changes sought for Whitehorse energy projects

Delegates call for separate property tax category for renewable energy projects

Yukon University has added seven members to its board of governors in recent months. (Crystal Schick/Yukon News file)
New members named to Yukon U’s board of governors

Required number of board members now up to 17

Yukonomist Keith Halliday
Yukonomist: Your Northern regulatory adventure awaits!

“Your Northern adventure awaits!” blared the headline on a recent YESAB assessment… Continue reading

Yukoner Shirley Chua-Tan is taking on the role of vice-chair of the social inclusion working group with the Canadian Academy of Health Sciences’ oversight panel and working groups for the autism assessment. (Submitted)
Canadian Academy of Health Sciences names Yukoner to panel

Shirley Chua-Tan is well-known for a number of roles she plays in… Continue reading

Most Read