Dene community signs deal

Murray Lyons, May 26, 2007, CanWest News Service, SASKATOON -- Work could start in the winter on Saskatchewan's second big oilsands exploration project, which could see members of the local Dene community gain jobs, training and a share of petroleum revenue down the road should drilling hit another pocket of bitumen.

A deal signed this week between a private equity petroleum company and the Buffalo River Dene First Nation is supposed to ensure people living in the band's isolated communities of Dillon, Michel and St. George's Hill benefit from about $35 million in exploration spending expected during the next two to four years.

The deal involves exploration not only on treaty reserve land located west of Peter Pond Lake, but also a million acres that is considered traditional lands used by the Dene people. Before Chief Louis Chinalquay signed the deal Thursday afternoon with Toronto-based Access Energy Inc., the agreement was put to a vote of band members and approved.

The band considers the agreement with Access Energy to be the first of its kind in Saskatchewan. Besides making the band an equal partner in a bitumen deposit, which would be an eastern extension of the Fort McMurray formation, the agreement also obliges the company to support and improve First Nations social infrastructure, including education, housing, health and training.

Chinalquay is hoping the jobs and training will lead to more band-owned companies.

"All in all, we look at it as taking care of ourselves -- as self-determination for our community -- and the need for our infrastructure," he said. "The social problems we have, we need to address that within this deal."

Paul Parisotto, president of Access Energy, expects seismic work and possibly some early drilling to be started this winter.
"You can only really drill in this area when it's frozen," he said. "We're hoping to get all geared up to have a winter drill program."

A few hundred kilometres to the north, Oilsands Quest has spent two winters and a considerable amount of money to prove there is a large bitumen deposit. Parisotto says he anticipates oilsands found on the Buffalo River traditional territories will be the type of deposit that can be extracted through steam-assisted gravity extraction methods.
Parisotto, also a mining company CEO with publicly traded Arizonastar Resources, says he was not afraid to get into an agreement that recognizes First Nations rights to traditional territories.

He says the lack of prior consultation with Dene people in the area is likely one reason no petroleum exploration has ever explored these lands.

Parisotto says it's not unusual in the mining industry for a partner that has staked land to gain a share of a deposit, even though it may not be putting up development money. He likens the band's claim to traditional territories as providing that stake.

He says the agreement to support the band's social development is the cost of entry into the area.
"To be successful you have to partner with the right entities and in this case, we're partnering with the Dene Nation and we think that makes a lot of sense," Parisotto said. "We're being pragmatic business people."

The Buffalo River First Nation filed a statement of claim against the province and the federal government late last year over what it says was their failure to meet the requirements, as outlined in a recent Supreme Court case, that governments have a "duty to consult" First Nations prior to resource development on traditional territories.

The provincial NDP government was not invited to the Thursday signing ceremony between the Dene band and Access Energy, although Saskatchewan Party MLA June Draude was invited and spoke at the event.