REGINA — The Muskowekwan First Nation is leading the way in resource development.
On Tuesday, Chief Reg Bellerose of the Muskowekwan First Nation signed an agreement with Vancouver-based Encanto Potash Corp. The unique agreement is for the development and operation a potash mine on the reserve, located near Punnichy.
"It's an on-reserve capital project," said Bellerose. "For on-reserve mineral development there's no template, so basically we had to struggle along and find everything we need"
He explained that it's Muskowekwan and not Encanto that makes the application for the head lease.
"So in essence we're in the driver's seat," said Bellerose. "It's not like our partner does all of the work."
He hasn't heard of any other reserve in Canada that has a potash mine on reserve and is pleased to be making headway in resource development.
According to the deal, Muskowekwan will receive three per cent of the profits and that money is to go into the Muskowekwan Resources Ltd.
Bellerose explained the money would then go towards helping the band meet the education, health and housing needs of the community members.
"Our needs at the First Nation level are growing; our population is growing and our government funding — is not meeting the needs," said Bellerose. "Our focus is own-source revenue and the best way is to partner with industry."
He said another benefit for Muskowekwan is that a mine will mean jobs for band members.
Bellerose said Encanto approached Muskowekwan three years ago because there are a number of First Nations located in Saskatchewan's potash belt and Muskowekwan was one of them.
"It's a win-win situation," he said, about the deal.
Bellerose said a referendum will soon take place because the community members still have to approve the deal. Muskowekwan has a population of approximately 1,700 members, with 1,000 living off-reserve. He's confident the members will vote to support the deal because it's a positive step forward for the community.
Jim Walchuck, president and CEO of Encanto, agrees the deal is mutually beneficial to both parties. "This is a major milestone for Encanto," he said. "I'm looking forward to moving the deal (ahead)."
Details of the agreement can be found on the Encanto website (www.encantopotash.com).
To date, Encanto has spent almost $11 million on the project and is prepared to invest in the next stage.
Walchuck said his company is confident that a potash mine can be established on Muskowekwan.
"We have six holes surrounding the property that tell us there's potash at fairly good grades," he said. "We have two holes that have shown that we have grades that are as good or better than the existing mines right now."
Encanto is looking at developing similar deals with other First Nations in the near future.
kbenjoe@leaderpost.com
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