Energy Development in British Columbia versus Alberta: Comparing Aboriginal Consultation Processes

Written By Duncan M. McPherson, Deirdre Sheehan, Marie Buchinski

Differing legal bases for the principal oil and gas regulators in B.C. versus Alberta result in divergent approaches to aboriginal consultation, with practical implications for developers.

The Energy Resources Conservation Board (ERCB) in Alberta is an administrative tribunal, with the capacity to hold hearings on energy project applications. As a quasi-judicial body, independent of government, the ERCB does not have a duty to consult holders of aboriginal or treaty rights (Dene Tha' v. Alberta (Energy and Utilities Board), 2005 ABCA 68). Analogizing from the recent Standing Buffalo decision (see Are Administrative Tribunals Required to Rule on the Crown's Aboriginal Consultation Duties?) involving the NEB, it appears the ERCB is also not required to decide on the adequacy of Crown consultation when assessing proposed projects, despite the provisions of Alberta's Administrative Procedures and Jurisdiction Act that authorize the ERCB to determine questions of constitutional law.

Akin to the ERCB in Alberta, the Oil and Gas Commission (OGC) regulates oil and gas activities, including pipelines, within British Columbia. In an effort to streamline regulatory requirements, however, B.C. established the OGC in 1998, not as an administrative tribunal, but rather as an agency of government issuing all permits required for oil and gas development through a single wicket. As such, unlike the ERCB and NEB, the OGC does not hold hearings on energy applications. As a branch of government, however, the OGC does have a constitutional duty to consult aboriginal parties affected by its decisions on energy developments (Saulteau First Nations v. British Columbia (Oil and Gas Commission), 2004 BCCA 286). Moreover, a statutory duty on the OGC to consult aboriginal communities is also established by section 4 of the Oil and Gas Commission Act, which requires the OGC to “encourage the participation of First Nations and aboriginal persons in processes affecting them.”

In practice, consultation processes for projects can unfold quite differently in B.C. as compared to Alberta. In B.C., the OGC takes the lead in consultations with First Nations affected by proposed energy developments. The OGC has developed established consultation processes with the aboriginal communities with which it has frequent contact. The details of these processes are set out in several Consultation Process Agreements with the respective First Nations. Certain Treaty 8 First Nations in northeast B.C., where natural gas development is focused, have also entered an Economic Benefits Agreement providing financial benefits linked to economic activity and provincial revenues generated in the area.

Industry is encouraged by the OGC to engage aboriginal communities prior to submitting applications to the Commission. In addition, the OGC may invite proponents to participate in discussions or issue resolution processes when the Commission consults with First Nations on applications, in order to identify options to minimize adverse impacts. Ultimately, however, the OGC undertakes the consultation with First Nations, is responsible for its adequacy, and reflects any accommodation of aboriginal concerns in conditions to project approvals.

In Alberta, in contrast, oil and gas developers are charged with initiating and, in many respects, conducting First Nations consultations. This is a function of two instruments. First, the ERCB's general consultation directives identify the parties with whom the proponent is required to consult. The ERCB expects proponents to address potential impacts on aboriginal groups as part of this public consultation. Second, where decisions of the Crown (not the ERCB), such as dispositions of Crown land, are required for an energy project to proceed, then the Alberta government's constitutional duty to consult potentially affected aboriginal groups is engaged. However, pursuant to Alberta's First Nations Consultation Guidelines on Land Management and Resource Development, the government expects project proponents to do much of the groundwork by carrying out procedural aspects of consultation such as notifying First Nations of the project proposed, providing them project-specific information, and meeting to discuss comments and concerns to determine potential mitigation measures.

The law recognizes that government can delegate procedural aspects of its consultation obligations to third parties, but ultimate legal responsibility rests with the Crown, raising potential litigation risk if excessive delegation occurs. This risk can be mitigated by seeking to involve Crown representatives directly in consultation efforts, regularly corresponding with the Crown, undertaking consultations early in project development phases, and, to the extent possible, discussing project-related issues with aboriginal groups on a with-prejudice basis. Project proponents remain vulnerable to court cases concerning alleged inadequacies in Crown consultation, which may cause project approvals to be quashed or delayed. In B.C., proponents may benefit from the proactive role of the OGC in aboriginal consultation to help allay this risk, whereas in Alberta, proponents are charged with the procedural aspects of aboriginal consultation, potentially affording them more control over the outcomes of consultation processes.