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Energy, Mines and Resources Minister Ranj Pillai and Yukon Party critic Scott Kent

Pillai ‘discontinues’ considering oil, gas interests

Energy, Mines and Resources Minister Ranj Pillai has cancelled any further consideration of interest expressed last fall about the potential for oil and gas leases in northern Yukon.

By Chuck Tobin on November 24, 2017

Energy, Mines and Resources Minister Ranj Pillai has cancelled any further consideration of interest expressed last fall about the potential for oil and gas leases in northern Yukon.

The minister cited concerns being raised by First Nations as the reason for his decision.

Every year, the Yukon government reviews expressions of interest it receives from the oil and gas industry regarding areas it might be interested in exploring.

If areas are identified, after conducting consultations with First Nations, the government can put out one or more lease options that companies can bid on for the rights to explore for oil and gas.

The process is exactly how Chance Oil and Gas – formerly Northern Cross – secured the rights to its stock of oil and gas leases on Eagle Plain.

There has, however, been next to no expressions of interest in recent years. But in the government’s intake last year, 15 different locations had been identified as areas of interest by one or more parties – two on Eagle Plain and 13 in the Kandik sedimentary basin that runs along the Yukon-Alaska border.

No further consideration

Pillai told the legislature Thursday he will not give any further consideration to those expressions of interest, as the affected First Nations do not want to proceed to the bid process at this time.

“Three northern Yukon First Nations — Vuntut Gwitchin First Nation, Tr’ondëk Hwëch’in First Nation and the First Nation of Na Cho Nyäk Dun — indicated that they did not support proceeding to a call for bids on the requested postings at this time,” said Pillai.

“The northern First Nations also expressed an interest in working more closely with the Yukon government on responsible oil and gas exploration and development in north Yukon.

“I am announcing today that this process is now officially discontinued, and there will be no further public review of the submitted locations related to the fall 2016 request for postings.”

In a scrum with reporters after question period, Pillai explained there were challenges with the 2016 process that was started under the former Yukon Party government.

He insisted there must be a partnership between the Yukon government and First Nations if there is going to be oil and gas development in the Yukon.

Pillai also pointed out there have been no further expressions of interest received since the 2016 intake.

Yukon Party critic Scott Kent expressed disappointment in Pillai’s announcement, calling it a broken Liberal promise from the 2016 election campaign.

It may have been understandable if the expressions of interest were inside the Dawson planning region, where a land use plan has not been agreed to, Kent told the legislature in response to Pillai’s ministerial statement.

“This was an opportunity to open new oil and gas development potential that would align with promises that the Liberals made in their platform – and I’m going to quote from their platform at this time: ‘supporting oil and gas development… on Eagle Plains, in collaboration with the Vuntut Gwitchin First Nation and in keeping with the provisions of… the North Yukon Land Use Plan…’”

Kent said Pillai’s decision is worrisome because it could threaten the existence of the oil and gas industry in the Yukon.

Substantial benefits

The industry, the critic told the legislature, has a long history in the Yukon – and has generated substantial benefits for the territory.

NDP Leader Liz Hanson, on the other hand, applauded the Liberals’ decision. She suggested it was a brave step by the government and a demonstration of its ability to use the tools it has to begin tackling climate change.

“Yukon, along with all governments, must demonstrate by its actions that it is prepared to make the systemic changes necessary to move away from fossil fuel exploration and extraction,” Hanson told the legislature.

“The notion of a viable oil and gas industry in Yukon is an illusion. The ‘pause’ button that the government has pushed on the oil and gas posting process is an opportune time for this government to do a reality-based assessment with respect to Yukon’s continued involvement in an industry that cannot, does not, survive without significant subsidies.”

Chance Oil and Gas filed a $2-billion lawsuit against the Yukon government after the Liberals came to power in December 2016.

It claimed the Liberal policy against hydraulic fracturing in the Yukon could affect the business potential of its Eagle Plain project.

Outside courtroom

Chance and the government are in discussions to resolve the matter outside the courtroom.

Over the years, Chance has insisted its target was conventional oil and gas resources which would not require fracking. But the government’s ban on fracking could potentially harm the business model, the company maintains in its court documents.

Chance has spent in excess of $100 million on its Eagle Plain project in the last decade, most of it since 2011.

– With a file from Taylor Blewett

Comments (16)

Up 0 Down 0

North_of_60 on Dec 1, 2017 at 1:32 am

Hydroelectric is the only renewable energy that can significantly replace O&G for heating and electricity generation. Wind and solar are fine for small scale off-grid applications, however adding them to the hydroelectric grid is a waste of money.
Increasing the storage capacity of the southern lakes reservoir to maintain September water levels into winter is the most cost effective option available at this time. Expose and deal with the influential NIMBYs who built too close to the shore, and get on with it.

Up 0 Down 8

OilAndGasONTheWayOut on Nov 28, 2017 at 4:15 pm

Oh dear, that photo of Napoleon Kent says it all really. Despondent and defeated and dejected. The Yukon Party should just give it up and find some other lost cause to try and champion.

Up 2 Down 1

B Fast on Nov 28, 2017 at 2:50 pm

"Chance and the government are in discussions to resolve the matter outside the courtroom" Don't give Chance a plug nickel. They are trying to intimidate with their $2 billion lawsuit. They made it very clear to Yukoners that they had no interest in fracking, now they are crying because they may not frack.

Up 3 Down 4

ProScience Greenie on Nov 28, 2017 at 2:35 pm

Seeing how we never had a O&G industry up here to begin with, nothing is really being shut down.

It's the ugly side of the O&G that we don't need - tons more crackheads, ugly cheap boom town subdivisions, morons out in the bush etc. More than a few Alberta Patch and Oil Sands vets are telling us to keep it out of here.

Up 1 Down 5

oil and gas welfare on Nov 28, 2017 at 2:17 pm

Abandoned oil and gas wells in AB could require $5 billion from public.

Up 1 Down 8

Sally Wright on Nov 28, 2017 at 11:20 am

I am very pleased with this decision. Now is the time to start building an economy that runs on renewable energy. Wind farms can heat our homes, there is nothing colder than a windy day, let's start harnessing that wind to heat our homes. Eagle Plains has incredible wind potential as does the mountain tops above the Whitehorse Valley. Every house should be well insulated and have a solar system, electrical Thermal storage and electric vehicle. The mines should be required to build some renewables on site and then donate it to local communities after their mine is done. Leave a positive legacy. Renewable energy is a vast resource the Yukon can benefit from for generations to come.

Up 3 Down 10

Werner Rhein on Nov 27, 2017 at 2:10 pm

Did any of the oil heads in the Yukon read the article in the Globe and Mail "Business risk from climate change now top of mind for Canada’s corporate boards"
The Yukon Party was betting on the wrong horse, a dead horse.
It is time that we go with the "time" and divest to green alternative energy technology.
Build a smart electrical grid with independent producers in every community.
Start to heat our buildings more with electric thermal storage and biomass.
Electrify the short distance transportation.
These measures would save the Yukon every year over $200 Million.
This saved money can be used to install green energy technology and lock for high tech manufacturing here in the Yukon. Land prices are lower here than anywhere else.

Up 5 Down 3

Josey Wales on Nov 27, 2017 at 12:45 pm

Certainly kicks up the phrase “closing time” as it relates to an economy.
Who better to address lowly subjects than a former bartender.
I guess diversity is not our economic strength, government money is allegedly enough.
Pandering is expensive, but hey...not their cash or future so who really cares?

Up 8 Down 4

north_of_60 on Nov 26, 2017 at 11:28 pm

Why would the Yukon need O&G development? Almost everyone is employed by four levels of redundant government, all fed by welfare payments from Ottawa.

Up 8 Down 4

jc on Nov 26, 2017 at 9:07 pm

Ah, its ok, In a couple of years the Conservatives and Yukon Party will be back.

Up 3 Down 3

How many people comment here have being in Antigonish? on Nov 26, 2017 at 1:45 pm

All Yukoners, know that this government is stumbling badly.
Instead of bringing Yukoners together, they are dividing Yukoners.
In making bad judgement on choices of one group over another means not full representation of the people.
I have known First Nations in the Yukon for over 30 years and they want the best for all Yukoners and this government does not have a clue how to bring all people's together for common clause.
Wilf Carter

Up 10 Down 2

My Opinion on Nov 25, 2017 at 6:00 pm

Constant behind closed doors meetings and agreements with First Nations. They have their own Government why are they determining what happens in mine with me having no say?

Up 10 Down 2

Max Mack on Nov 25, 2017 at 11:04 am

While the Liberals try to secure the First Nations vote, they should remember that 75% of Yukoners are not First Nations. Catering to First Nations interests should not be done in a way that deprives the rest of us of the benefits of resource development.

Up 5 Down 2

BnR on Nov 24, 2017 at 7:06 pm

Premier Pillai bringing it. The Antigonism running The Yukon.

Up 10 Down 1

Thomas Brewer on Nov 24, 2017 at 4:15 pm

This is so short-sighted on the part of the FN's. Diversifying Yukon's economy is the only way to prevent massive down swings when:

the Canadian dollar rises and hammers tourism
the price of gold drops, hammering the entire placer mining sector
the federal government finally decides to chop transfer payments to the territory

maybe they're counting on the transfers to FN's will be untouchable - and unfortunately, they're probably right, it's too hot a potato.
Sure would be nice to have natural gas and do away with the expense of oil, tanks that need replacing every 11 years now, and higher home insurance policies.

I wonder what the ownership of the various home heating fuel companies are... trucking up and distributing diesel to keep our houses warm is a very costly (read as high revenue) affair. Perhaps there's more at play here.

Up 2 Down 9

ProScience Greenie on Nov 24, 2017 at 3:40 pm

The O&G industry has a lot of negatives beyond the politics of hydrocarbons. Best to keep it out of our territory. Limited local production for domestic use might be fine in the future but only under the toughest rules and regs and with the O&G mentality found down in the Patch kept out.

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