First Nation sues Tundra Oil & Gas, province over oil wells near reserve land
Gamblers First Nation wants court to quash licences granted to oil company
Leaders of a small First Nation in Western Manitoba say they feel betrayed by an oil company that drilled for oil on land adjacent to a native reserve but did not make the First Nation a partner in any oil well profits.
Gamblers First Nation is suing Tundra Oil & Gas Partnership — which is owned by Winnipeg-based James Richardson & Sons Ltd. — and the Province of Manitoba, which licensed the company's drilling on land next to the First Nation reserve land.
Gamblers is asking Court of Queen's Bench for an order to quash the licences for the oil wells and provide compensation for oil that was extracted from the ground near the reserve.
'Upset and disheartened'
Gamblers Chief David LeDoux said he felt "upset and disheartened" upon seeing Tundra drill wells near, but not on, First Nations land.
LeDoux said he invited the company to Gamblers land to do exploration work with the belief the company would share its findings with the First Nation people and make them partners in oil wells with Tundra.
"For that not to happen didn't even enter my mind, that we wouldn't enter into a partnership," LeDoux said.
Gamblers band councillor Nathan Tanner was more blunt, saying he felt "used, taken advantage of."
"From my standpoint, it's a pretty strong kick in the teeth," he said.
In its statement of claim, Gamblers First Nation said Tundra drilled on land outside of the First Nation, but was considered traditional territory by the reserve and that its people continue to hold aboriginal title to that land.
Compensation disagreement
The claim alleges that when Tundra began extracting oil from the adjacent land in 2014, that also diminished the oil available under the reserve lands without providing compensation to the Gambler people.
He said Tundra did not share the results of seismic exploration work the company did on Gamblers reserve land because the information is proprietary.
"To provide them with our detailed information would allow them to take that and shop it around to other oil companies, so that would be kind of counterproductive from our perspective," Neufeld said.
He said Chief LeDoux and Councillor Tanner both signed a Jan. 16, 2014, "permit to conduct geophysical operations" on the reserve land and paid the First Nation compensation of $13,550 for costs associated with exploration work
Neufeld said he doesn't know at this time whether it would be worthwhile drilling on Gamblers reserve land.
He said despite the lawsuit, Tundra would still be willing to lease the mineral rights from Gamblers First Nation for its land.
"The fact a statement of claim has been filed doesn't change that we'd much prefer to work with the communities where we operate," Neufeld said.
"I think we've been very transparent with them," he said. "We continue to offer to meet with them."
Tundra followed rules, CEO says
Neufeld said Manitoba's petroleum regulations govern the spacing of oil wells and how far they have to be from boundaries of neighbouring lands.
He said Tundra followed all provincial regulations in locating its wells.
The Gamblers lawsuit alleges the province had an obligation to consult with Gamblers before granting licences to Tundra, but did not do so.
James Tanner, an adviser to the First Nation, said "there was not only no consultation but after several concerted attempts at contacting the Manitoba government, they responded and said 'there's no duty to consult.'"
The statement of claim alleges that "due to the proximity between the adjacent lands and the reserve lands, the extraction activities have resulted in the capture of the natural resources from the reserve lands and have depleted the natural resources" (meaning the oil and gas reserves).
A provincial spokesperson said in a statement, "Manitoba Mineral Resources is of the opinion the oil wells licensed in the Binscarth area on privately-owned lands will not have an adverse effect on the exercise of treaty and aboriginal rights by members of Gamblers First Nation."
The province said no oil underlying Gamblers reserve land has been depleted by offsetting oil wells, all of which have been licensed according to Manitoba's Oil and Gas Act.
The province said the law provides directions on protecting rights of adjacent land and mineral rights owners.
The setback distance for an oil well from a competitive lease boundary is 100 metres, the province said, and if another well is drilled closer than that, its production can be restricted.
"Manitoba Mineral Resources considers that Tundra Oil & Gas has complied with the act and regulations," the province concluded.