Encanto Potash Corp V.EPO.H

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Muskowekwan Band Member Oppose Potash Deal 2011


Another membership vote delays movement on potash development
Saskatchewan Sage
Author: 
By Shari Narine Sage Contributing Editor MUSKOWEKWAN FIRST NATION 
Volume: 
16 Issue: 
2 Year: 
2012 
The first potash development on a First Nation will be delayed at least three months. But the next time members of the Muskowekwan First Nation vote only a simple majority will be required.

The second vote was forced as not enough eligible voters came out to the polls on Nov. 26 to voice their support or opposition in designating mineral rights to the Crown which in turn would enable Canada to issue a mineral lease to Muskowekwan Resources Ltd. Muskowekwan Resources, a wholly owned company of the First Nation, holds the mineral rights in trust. In 2010, a joint venture agreement was signed between Encanto Potash Corp. and Muskowekwan First Nation, in which Encanto would put up the money for exploration while the First Nation received royalties, which are expected to run between $50-$60 million each year. Muskowekwan will also receive preferential employment and contracting opportunities.

The vote was deemed invalid as the requisite 50 per cent plus one eligible voters did not turn out. According to the Aboriginal and Northern Affairs Canada roll, there are 1,114 Muskowekwan First Nation members, both living on and off-reserve, eligible to vote. Voter turnout fell 11 short.

“Because reserve land is held for the use and benefit of all members of the nation, whether they’re living on or off reserve, (chief and council) have to get informed consent of those members,” said Trevor Sutter, manager of communications for the Saskatchewan ANAC office.

A band council resolution was passed to hold a second vote. There must be three months between the two votes. A second remedy of the situation could have been to ask ANAC to review the roll of eligible voters. That challenge could come from chief, council or member of the electorate and could be filed under two categories: corrupt practises or breach of the regulations. Sutter said the second condition would have been the applicable one in this case as it deals with ineligible people on the voters list, and a review would have had to be carried out in 38 days.

Rod Hope, manager of Encanto Resources, said he is not surprised at the lack of voter turnout. Voter apathy is something seen throughout the province and the country. He is pleased that over 80 per cent of those who did vote were in favour of the designation.

Encanto was granted an exploration permit in 2009 and since then has drilled eight exploratory wells. The engineering report has been favourable.

“There is no question we have more than enough potash on the home reserve and the TLE reserve lands for a hundred-year mine,” said Hope.

As potash development on Muskowekwan First Nation is the first of its kind on any first nation, it has been an ongoing process of learning for all parties involved, said Hope. For Encanto, it is a project worth pursuing because of the advantage of working with a single land owner instead of the usual thousands of landowners.

“This is the first step in a very long process,” said Sutter.
Following the second vote, which can occur no earlier than late February, Muskowekwan Resources must apply for a mineral lease on the TLE reserve lands. Approval could take up to one year. While waiting for lease approval, the environmental assessment is underway and could take up to 18 months to complete. Because reserve lands are federal but Muskowekwan First Nation is within Saskatchewan, Hope anticipated a tripartite agreement will be needed. A pre-feasibility study looking at economic features of the project is also being undertaken, identifying where the mine and facilities will be located, and access to road, rail and power. Until the location of the mine facility is determined, a surface lease designation cannot be applied for. Muskowekwan membership will have to vote on that surface lease designation.