Canada’s arctic gas project has been served with a frosty reminder that it’s struggle with northern natives still isn’t over. The last aboriginal holdouts against the $7 billion (US$6 billion) Mackenzie Gas Project have taken their case to court for the second time in two years.

Deh Cho First Nations launched a lawsuit alleging their rights are being abused by Northwest Territories authorities, Indian and Northern Affairs Canada and MGP senior partner Imperial Oil Ltd. The protest, lodged in the Supreme Court of the Northwest Territories, seeks to hold up land access permits that project spokesman Pius Rolheiser said must be obtained to resume work on construction planning suspended since last April.

“We’re going to make sure this is done right,” Deh Cho Grand Chief Herb Norwegian vowed in an interview. The Deh Cho obtained C$21 million (US$18 million) from an out-of-court settlement of their first protest lawsuit with the federal government last fall, and Norwegian said negotiations also could close the second case. “Anything is possible. We’ve always been open to reaching agreements,” the chief said. “The bottom line is there are issues here that need to be resolved, and the sooner the better.”

The new lawsuit challenges a January decision by the Mackenzie Valley Environmental Impact Review Board, a “co-management” agency that includes representatives of federal, territorial and other northern native communities that have made land claim settlements with Ottawa and support the project. Deh Cho claims on territory covering the southern 40% of the proposed 1,200-kilometer (750-mile) Mackenzie Valley pipeline’s route remain under negotiation.

The board exceeded its authority by retracting a condition that favored the Deh Cho from an initial ruling on the project’s request for northern work permits, the new lawsuit says. The board’s first decision a year ago said permits should only be granted if the gas project made land access and benefits agreements with the 13 communities in the Deh Cho region.

But the January ruling scrapped the condition with an amendment made after further discussions with the government and Imperial. The Deh Cho were wrongly excluded from the talks, the lawsuit alleges. No dates were set for court hearings, and no participants in the three-sided legal tangle disclosed plans for trying to negotiate a settlement. Talks on access and benefits agreements also continue between the gas project and the Deh Cho, but with no sign of a breakthrough.

“We’ve been at loggerheads for months,” Norwegian said. “Some days [the native and industry sides in the talks] look close to agreement; some days they’re far apart.” The contested permits are needed for geotechnical surveys of ground conditions such as soil and gravel bids that will guide designs, site preparation and construction of project facilities, Rolheiser said. “That’s a critical component of the construction plan,” he said.

No permits have been received for the Deh Cho region. No work is under way. The project has set no deadline for obtaining work permits. But northern pipeline hearings are underway in 26 northern communities, a target of January 2008 is set for starting construction, and Rolheiser said the project hopes to stay on schedule.

“This will be an important work season for us,” he said. The missing permits and the lawsuit are “an obstacle we need to overcome. We remain confident we’ll be able to get permits and do work needed to keep the momentum of the project going.” Norwegian said his Deh Cho have also not yet responded to a June 30 deadline for them to use their option to join the Aboriginal Pipeline Group, which owns a one-third interest in the Mackenzie line.

Discussions have been held with representatives of other aboriginal communities along the line that have bought into the group: the Inuvialuit and Gwich’in on the Mackenzie Delta and the Sahtu in the central Mackenzie Valley. But they all have land claim settlements and that sets them well apart from the Deh Cho, Norwegian said.

“It’s kind of backwards,” the chief said in describing the deadline as a sales pitch that his community is in no hurry to catch while it is still negotiating land claims and access-benefits agreements. “It would be ludicrous for us just to jump into bed with these guys and at the same time be trying to bargain hard.”

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