Audit needed to expose systemic problems that led to Yukon mine's failure, chief says

The chief of the First Nation of Na-Cho Nyäk Dun says a government audit would not only expose shortcomings that might have contributed to the failure of the Eagle mine, but could also potentially prevent future environmental disasters from happening across the Yukon.

"It's about the assessment, the regulation and the oversight of Victoria Gold at the Eagle Gold mine itself," Chief Dawna Hope told CBC News. "The second [reason] is the failure to implement the process and promises of the federal devolution in the Yukon. They're very much intertwined together, and, with the delayed implementation of the devolution, it just perpetuates legislative chaos that they've created."

The First Nation has called on the Auditor General of Canada to launch a performance audit of the territorial and federal governments to uncover underlying systemic problems that led to the mine's failure, which saw roughly four million tonnes of ore being treated with cyanide solution slide off a heap at the site, with about half the material leaving containment. 

In a blistering letter to the Auditor General on Dec. 9, the First Nation stated Victoria Gold, the beleaguered company behind the mine, has faced a rash of water management problems for years. Na-Cho Nyäk Dun also accuses the Yukon government of looking the other way.

Hope said the end game is transparency and accountability, which all Yukoners deserve more of.

"This proposed audit could advance responsible, sustainable mineral governance in the North and help us prevent the reoccurrence of an environmental disaster like we see in my backyard," she said.

How devolution factors in

In 1997, Yukon First Nations, the Council of Yukon First Nations and the Yukon government signed a memorandum of agreement, which helped lay the groundwork for devolution. The agreement supported the 2003 transfer of land and resource management responsibilities from Ottawa to the territorial government. The Eagle Gold mine, the First Nation says, was the first major gold mine to fall under territorial jurisdiction post-devolution.

Hope said broken promises linked to devolution remain, with little to no progress on overhauling mining legislation that Yukon First Nations have been pressing the territory on for years.

"The promise of devolution has kind of betrayed us and it's put us in a very detrimental place as Yukon First Nations," she said. "We're still basically going on antiquated legislation from the Gold Rush era."

A spokesperson with cabinet told CBC News the Yukon government shares the First Nation's concerns.

"Should the Office of the Auditor General determine that the proposed audit is within its mandate and opts to undertake it, we will fully respond and support any requests for participation or information from them," Laura Seeley said.

In an email, the office of the Auditor General stated it continues to review Na-Cho Nyäk Dun's request.

'Negligent, ineffective and environmentally perilous'

The First Nation's letter to the auditor blasts the territorial government, calling its oversight of mining "negligent, ineffective and environmentally perilous."

Problems with the Eagle mine were in plain sight long before it failed, states the letter, which includes a litany of problems like a lack of on-site storage and little to no water treatment capacity.

The letter suggests the on-site water treatment plant is a misnomer, with later iterations of the system "ultimately a crude, hardware store depiction of a water treatment unit."

"The lack of effective cyanide destruction capacity, or even an understanding of the technology needed to rapidly treat cyanide solution at Eagle Gold, has led to major costs and delays in the response to the June 2024 failure. The ongoing water balance and water quality risks at the site now are a consequence of not having effective cyanide destruction technology and capacity."

There's always been a risk that water would need to be treated then discharged into the environment, the letter states, but, despite the regulator's insistence, the Yukon government failed to take proactive steps to safeguard the land and water.

In August, the First Nation called for a public inquiry into the mine failure. The territory refused, launching instead a process under the Independent Review Board, an appointed group tasked with providing technical opinion and advice on mine waste management facilities.

The First Nation says this proves the territory is just trying to save face, that it isn't willing to analyze its own regulatory shortcomings.

"The nature of the [Independent Review Board's] work, the information that is being shared with its members, is unknown and the lack of transparency gives rise to significant apprehension that the entire undertaking is a whitewash that will ultimately sweep fundamental problems under the proverbial rug," the letter states.

That the territory hasn't yet rewritten and implemented its antiquated mining laws amounts to a betrayal, undermining reconciliation, the letter states.

"[The Yukon government's] decades of inaction make manifest a clear preference to sacrifice reconciliation and the advancement of constitutionally protected treaty rights to the altar of convenience and expedience. It perpetuates a nineteenth century vision of mining that disregards Indigenous Peoples and their lands in favour of the short-term pursuit of profits by the mining industry."

NDP backs First Nation

The NDP has come out to publicly support Na-Cho Nyäk Dun's plea. 

Leader Kate White told CBC News the territory has shown the First Nation disrespect when what it deserves are answers.

"I think it's important that as a Yukon politician, as a person who cares deeply for the land, the water and the animals and really believes in First Nation sovereignty and rights, that it's my responsibility to try to amplify what they're calling for," she said.

"There's so many shortcomings," White added. "The Yukon government has a lot of things to be called into account [for], but so does the government of Canada."