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Date: Wed, 12 Jul 1995 18:41:07 -0700
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Date: Tue, 11 Jul 1995 07:59:14 -0300
From: Larry Innes <es051322@ORION.YORKU.CA>
Subj: Voisey Bay Update 07/07/95

Mailing List: INNU-L <INNU-L@odie.ccs.yorku.ca>

Voisey Bay Update 07/07/95

From Larry Innes, Environmental Advisor,
Innu Nation, 5 July 1995

This is a brief account of mineral exploration and development activities at Eimish (Voisey Bay), and of some of the major concerns that the Innu have with this development. I hope that it will be useful to those of you trying to follow this issue, which seems to have the pace and momentum of a tidal wave.


Most recently, the Innu Nation has entered negotiations directly with Newfoundland Premier Clyde Wells in an attempt to negotiate a protocol to provide interim protection for Innu land and Innu rights from mineral exploration and development activities at Eimish. Two meetings between Wells and the Innu Nation have taken place, and a third meeting is anticipated in the near future.

While the fact that negotiations are taking place may be a positive development, the Innu Nation has major difficulties with the approach that Newfoundland is taking. In general terms, the Province is offering to provide the Innu Nation with information and a limited advisory role in decisions regarding approvals of exploration activities. However, Wells has made it clear that the Province is not prepared to delay the exploration activities in order to collect baseline environmental data or conduct an environmental review of the impacts of exploration and development activities at the site.

The Innu maintain that no development should be considered until two conditions have been met: 1) a resolution of land rights negotiations is achieved through a final settlement; 2) a comprehensive study of the environmental, social and economic implications of mineral exploration and development is complete.

If exploration and development continues to proceed without resolution of land rights or the negotiation of substantial interim protection measures, the Innu Nation has publicly indicated its intention to pursue an injunction against the government and the companies in the courts.


This land is Innu and Inuit land. It does not belong to the Newfoundland government or to Canada. We never gave it to them, and we continue to use it. But it makes our lives very difficult when there is more low-level flying, more fishing camps, and more mining without our consent. The companies who come here are parties with the governments in stealing land from the Innu people. - Tshenish Pasteen, Utshimassit Elder

The Innu have opposed mineral exploration at Eimish without their consent since issuing an eviction order to the companies in February, 1995, citing the failure of Diamond Fields Resources and Archean Resources to obtain the permission of the Innu people or prepare an environmental and cultural protection plan before conducting exploration activities on aboriginal land.

The eviction forced the company to suspend exploration activity, but a 12-day standoff between Innu and over 50 RCMP officers ensued at the remote location. An attempt by the Labrador Inuit Association, which also has rights in the Eimish area, and the Innu Nation to negotiate with the two companies ended abruptly when the company made it clear that it would not recognize aboriginal rights and resumed exploration activity.

In the few months that have followed, Diamond Fields has intensified exploration efforts at Eimish. There are now 4 drills active on the site, and over 140 core samples have been drilled. There are now over 80 employees at the camp, including more than a dozen Inuit and four Innu.

This situation is creating a new set of difficult challenges for the Innu Nation, which is being forced to deal with the vast social, environmental and economic implications of a proposed mine at Eimish and an unprecedented level of exploration activity throughout their territory while attempting to negotiate a land rights settlement with the governments of Newfoundland and Canada. Voisey Bay is the latest threat to Innu land and Innu rights, intensifying the impacts of low-level flight training, road expansion, industrial forestry and hydroelectric developments which have already had profound cultural and environmental consequences.

These challenges are compounded by the pace and scale of the mineral rush and the Newfoundland government's enthusiastic endorsement of the activities. Diamond Fields, along with partners Inco and Teck, are working around the clock to transform the Voisey Bay discovery into a producing mine as early as 1998, while dozens of exploration companies are using every means possible in the race to announce the next 'big find'.

However, despite the government's enthusiasm, Newfoundland's mineral legislation is inadequate to deal with the challenges of exploration on this scale. Work is being permitted to proceed in the absence of critical baseline data about potential environmental impacts. At this time, companies are not required to follow environmental protection guidelines, and there are no provisions for monitoring or mitigating company activities.

The Innu Nation is concerned that the pace of exploration and the immense pressure to develop the Voisey Bay discovery into a producing mine is precluding careful assessment of the social, economic and environmental impacts of these activities and prejudicing the possibility of a fair settlement of land rights negotiations.


Diamond Fields (DFR) continues to release results from drilling operations which expand the size of the ore body. At present, the company has proven reserves of 27 million tonnes. Most industry analysts, however, assign a much higher potential to the deposit. In dollar terms, assuming the ore contains 3.6% nickel, 2.17% copper, and 0.15% cobalt at market prices of $3.50 US/pound for nickel, $1.30 US/pound for copper and $30 US/pound for cobalt,this means that the present value of the find is now in the billions of dollars. Depending on whose numbers you believe, the present gross value (before considering the costs of mining, royalties and taxes) ranges from 10-20 billion dollars.

On June 8th, Inco, one of the world's largest nickel producers, bought a 25% stake in the Voisey Bay project for roughly $700 million (CDN). Basically, what this means to investors and the mining industry is that Inco, which controls roughly 25-30% of the world's nickel market, now has a significant degree of control over the nickel produced at Voisey Bay. The deal gives Inco the rights and obligation to market all of the nickel and cobalt produced by the mine for the first 5 years of production and a minimum of 133 million tonnes for the next 15 years. A few weeks prior, Teck, another large mining concern, paid over $100 million for a 10% share in the project. In concluding these deals, Diamond Fields has gained large partners with extensive experience in nickel mining and very deep pockets to finance the project, and with Inco, a guaranteed buyer for most of the product.

What this means is that it is no longer a question of if there will be a mine. Unless something radically changes, the outstanding questions are now by how and when the mine be built.

Diamond Field's deal with Inco is structured to insure that Diamond Fields Co-Chairman and majority stockholder, Robert Friedland, remains in control of the company and the Voisey Bay development. It will be Diamond Fields that has the lead in developing the mine, with partners Inco and Teck playing support roles in the project.

The issue of how the mine will be developed is still outstanding. The Newfoundland government and media has given a great deal of attention to the possibility of a smelter being built to refine the ore from the mine. However, Diamond Fields has publicly stated that if a smelter is built in Newfoundland or Labrador, it will not be built at Eimish, although Goose Bay is being actively considered.

>From the Innu perspective, the almost certain prospect of a large producing nickel mine roughly 75km from Utshimassit (Davis Inlet) threatens to open a Pandora's box of complex problems.

Innu are expressing a great deal of uncertainty over the future of their communities and their way of life, and anger over the refusal of the companies to deal fairly with Innu concerns. They are worried about the implications of additional social and economic pressures on communities that are just beginning to heal after years of abuse and despair.

However, the frantic pace of exploration and development is not permitting Innu communities time to adapt organically to this new reality. The timelines and goals of the companies and the Newfoundland government do not take into account the need of the Innu to determine their own visions of an economic future of their communities--a vision which may not include Voisey Bay.

I don't think that governments and companies understand how fragile we are. We have taken steps to deal with our problems, but we need some consideration from government and companies of the impacts that their decisions will have on our communities. We are not prepared for the full economic impacts of this project. We need to be careful to minimize the economic and social impacts of this development on our communities. - Innu Nation President Peter Penashue


At last count, there were over 240,000 claims staked in Labrador by hundreds of companies and individuals. The majority of these claims are in the Eimish area and north of Nain, but a growing number of claims are being staked in other areas of Innu land use. Even if there is not another Voisey Bay discovery, the impact of exploration work needs to be carefully considered. These claims constitute third party interests at the land rights table according to the Newfoundland government. In addition, if they are actively explored, there are impacts on Innu rights and the environment which are associated with airborne geophysical surveys (intensive disturbance of wildlife), exploration campsites (potential for increased harvesting by survey workers), etc. which need to be considered.

The most geologically interesting areas for nickel/copper/cobalt (eg the areas with rock formations much like those at Eimish) were staked prior to the announcement of the Voisey Bay discovery by Diamond Fields and Archean Resources. The majority of the other claims were staked following the discovery, and many of them will no doubt result in nothing. However, there should be consideration of the possibility that other discoveries will be announced. According to geologists, there is the potential for more than one Voisey Bay in Labrador.

Additional finds would make large-scale industrial development (such as the construction of a smelter on-site) more likely, and with the development of associated infrastructure (roads, rail and port facilities) may revive interest in old projects that were abandoned for economic reasons (such as the Strange Lake rare-earth metals deposit or the BRINEX Kitts-Michelin uranium project)


The impacts of exploration, especially exploration conducted at this pace and scale, are not being adequately addressed. Newfoundland has failed to responsibly exercise the jurisdiction that it claims over Innu land. It is apparent that Newfoundland's regulatory regime is completely inadequate to deal with exploration of this pace and scale.

Some examples include:

Larry Innes Environmental Advisor
Innu Nation
P.O. Box 119
Sheshatshiu, Nitassinan (Labrador)
via Canada A0P 1M0

es051322@orion.yorku.ca (direct to me)
innu@web.apc.org (general to Innu Nation)
Phone: (709) 497-8398
Fax: (709) 497-8396