Canada signs 'historic' deal with Inuvialuit, N.W.T., Yukon gov'ts over offshore oil and gas

A new deal has been signed billed as the first of its kind in Canada that's meant to give Northerners more of a say in any offshore oil and gas development in the western Arctic.

Dan Vandal, Canada's minister of Northern Affairs, was in Inuvik, N.W.T., on Thursday to sign the deal, alongside Inuvialuit Regional Corporation (IRC) chair Duane Ningaqsiq Smith, and the premiers of Yukon and the Northwest Territories.

According to a news release on Thursday, the Western ArcticTariuq (offshore) Accord is an "historic" agreement, and the first of its kind with an Indigenous government as a full party.

The accord is intended to ensure thatInuvialuit, as well as residents in Yukon and the N.W.T., share in any decision-making about offshore development of petroleum resources, and are the prime beneficiaries of any economic benefits.

"This is a very significant day," Smith said at the formal signing event in Inuvik. He said such an agreement has been talked about for decades.

"It's been a long time coming, and I think everybody has made compromises and reached an understanding in how to move forward."

N.W.T. Premier Caroline Cochrane said her government was waiting for the IRCto be ready to sign the accord, and then "came on board" as well.

"This accord will hopefully guarantee, once it's in legislation, that nothing will be decided about offshore in the NorthwestTerritories withoutus being at the table and agreeing in a consensus style," Cochrane said.

Yukon Premier Ranj Pillaisaid the accord is also about protecting the region, in more ways than one.

"We know how sensitive things are there, not just from an environmental standpoint, but the more activity in the North when we think about Arctic sovereignty," Pillai said.

The 2022 federal budget provided $2.5 million over five years for the IRC to help implement and administer the accord.

Moratorium since 2016

The last time the federal government issued offshore exploration licencesin the Arctic was in 2014. In2016, Ottawa unilaterally haltedoffshore oil and gas licencing in the Arctic indefinitely, and committed to reviewing that decision every five years.

The premier of the N.W.T. at that time, Bob McLeod, then issued a "red alert"accusing the federal government of being "patronizing" and "colonial" andbypassing local government.

In 2019, Ottawa prohibited offshore oil and gas activity in the Arctic.

Some Northern politicians have been pushing for those restrictions to be lifted, arguing that the North needs the economic development that would come with offshore exploration and licensing.

Some energy analysts, however, are sceptical of the future demand for Arctic oil and gas.The International Energy Agency backs up that view, predicting inits2022 reportthat natural gas demand will plateau by the end of the decade and that rising sales of electric vehicles mean that oil demand will also level off by the mid-2030s.

Minister Vandal said the ban on Arctic offshore oil and gas development is indefinite, and that the government is "constantly evaluating the moratorium based on science."

"We continue to work very closely with all of our northern partners, including Inuit, as we assess climate- and marine-based conditions in the Arctic, which will inform our future decision-making on the moratorium."

Whether the government would supportthe IRC, should itwish to develop offshore oil and gas, would depend on the science,said Vandal.

He said the accord also provides for shared decision-making on the development ofrenewable energy sources.

Vandal, Pillai leave Inuvik early

The announcement of the accord was supposed to be made at a news conference in Inuvikon Thursday. That news conference was cancelled shortly before it was set to begin, and Vandal and Yukon's premier left town early.

Vandal, who planned to stay the night in Inuvik,said they decided to leave earlybecause there was a lot of smoke in the area, and there was a "strong potential" for an evacuation alert due to wildfire.

"We could not predict what the future was going to bring, not only today but tomorrow, understanding that flightsare necessary to leave," he said.

Town of Inuvik officials said late Thursday afternoon that the town is not under threat, and no evacuation alert had been issued.