Baffinland CEO disappointed by rejection of company's expansion project

The head of Baffinland Iron Mines Corporation says he's disappointed the company's mine expansion project in Nunavut was rejected by the federal minister of Northern Affairs, and that he's confident there is still community support for the project.

"After four years of work and the material progress made since May, we are disappointed the minister did not encourage all parties to promptly settle any outstanding issues and agree on a practical path forward for the project," said CEO Brian Penney in a news release from the company on Thursday. 

On Wednesday Northern Affairs Minister Dan Vandal said, for the time being, the company can't go ahead with its proposed Phase 2 expansion project at its Mary River mine.

The expansion project would have seen the mine's annual output double to 12 million tonnes of ore. The project would have also involved the construction of a 110-kilometre railway to the Milne Inlet port.

In May, the Nunavut Impact Review Board (NIRB), after a long review, recommended that it not be allowed to proceed. The NIRB concluded that the mine has the potential for "significant adverse ecosystemic effects" on marine mammals, fish, caribou and other wildlife, which in turn could harm Inuit culture, land use and food security. 

Penney said the Phase 2 proposal was based on "years of in-depth study and detailed scientific analysis." He also said  the company had executed a new Inuit Certainty Agreement with the Qikiqtani Inuit Association (QIA).

He said the company had done "extensive consultations" and had made additional commitments to stakeholders after the NIRB gave its May recommendation, including mediation with the QIA and the Ministry of Northern Affairs.

"Based on extensive direct consultations, we are confident the proposed expansion has widespread support from local communities, HTOs [Hunters and Trappers Organizations] and the International Union of Operating Engineers, which has been expressed directly to the minister," Penney said.

Phase 2 would have meant long-term stability for its business, for the local communities on Baffin Island and for the territory, Penney said.

It would have also lowered "marine and terrestrial effects of our current operations," he said, and it would have increased the number of jobs.

Penney said "given the clear benefits to Inuit, Nunavut and Canada as a whole" the minister's decision "is both surprising and disappointing."

In his statement, he also said the rejection of Phase 2 would have an "immediate and significant" impact on Mary River operations and its 2,500 employees, of which approximately 300 are Inuit. However, he did not elaborate on what that might be in his Thursday statement.

"We look forward to immediately meeting with the QIA and the minister to discuss a practical path forward. We will provide further details after these discussions conclude."

Decision balanced competing interests: Nunavut environment minister

With its expansion project, according to Peter Akman, Baffinland's spokesperson, the company also promised several financial benefits, along with the construction of daycare facilities in each of the five impacted communities, an office and training centre in each of the five communities which would incorporate an "elders' room to ensure that we continue to learn from their knowledge and experiences."

And, Akman said, the expansion would have meant seven new community-based positions in each of the impacted communities, with two additional positions in Pond Inlet, and more.

A written statement from David Akeeagok, Nunavut's environment minister, acknowledged that Baffinland's proposed expansion project could have provided potential socio-economic benefits to residents.

It also said Vandal's decision "reflects the concerns brought forward" in the NIRB's recommendation report in May. 

"We recognize the benefits of existing operations at Mary River, as well as the need to protect our lands and waters. I commend Minister Vandal for balancing this difficult decision," Akeeagok said.

"The minister's commitment to the regulatory regime is acknowledged. Nunavummiut, regulators, intervenors, and proponents all benefit from an efficient and transparent regulatory system."

Inuit want safe development, says MP

Nunavut MP Lori Idlout said it was gratifying to hear that the Phase 2 project won't be going ahead for the time being.

"I was very relieved, then I became celebratory, because Inuit have been heard," Idlout said. "It feels it's a huge relief to know that our environment will be slightly more protected."

Idlout said it's not that Inuit are opposed to mining operations, but that they want it done as safely as possible.

"Inuit have not been completely opposed to the project, they want better protections for the environment. Inuit want to make sure that we're all doing better to ensure that Inuit right to harvesting is being protected," she said.

When it comes to possible future projects from Baffinland in Nunavut, Idlout said she encourages the company to take a different approach — one more focused on the environment, in her opinion.

"Inuit have been saying that there are already negative impacts to the current project," she said.

"I know that Baffinland has the resources to do better mitigation. They need to make sure that they are held accountable for the impacts that Inuit are already experiencing in the environment and the impacts on the wildlife."

Northern affairs minister open to more Baffinland proposals

Minister Vandal told CBC that his office is open to more proposals from Baffinland.

"I think that this [Phase 2] was something that was not quite ready yet but they should continue talking to the Qikiqtani Inuit Association and work forward in a positive way. I really hope that occurs," Vandal said.

He also said that the mine still has permission to mine up to 18 million tonnes from Steensby Port, south of the mine.

Levi Barnabus, the acting president of QIA, said concerns remain for his organization about the mine's environmental impacts.

"QIA believes important commitments were made in 2022," Barnabus said. "QIA believes in making these commitments a reality and proving Mary River mine can be effectively managed before future expansion decisions can be made."