FROM HYDRAULIC FRACTURING CONFLICTS TO INNOVATION...

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MICHELE-LEE MOORE, KARENA SHAW, ROSANNA BREIDDAL, AND MATHEW MURRAY, UNIVERSITY OF VICTORIA Research conducted 2013-2015 FROM HYDRAULIC FRACTURING CONFLICTS TO INNOVATION GENERATION: A CASE STUDY OF WATER GOVERNANCE IN NORTHEASTERN BRITISH COLUMBIA

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MICHELE-LEE MOORE, KARENA SHAW, ROSANNA BREIDDAL, AND MATHEW MURRAY, UNIVERSITY OF VICTORIA Research conducted 2013-2015

FROM HYDRAULIC FRACTURING CONFLICTS TO INNOVATION GENERATION: A CASE STUDY OF WATER GOVERNANCE IN NORTHEASTERN BRITISH COLUMBIA

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WHY DID WE DO THIS RESEARCH?In the past decade, the Province of British Columbia has actively promoted the development of extensive shale gas resources in the province’s Northeast. The rapid industrial expansion, particularly between 2008-2011, led to an increase in the allocation of water to be used for hydraulic fracturing for shale gas. It also, however, created conflicts with Indigenous nations upon whose traditional territories these activities occurred.

Many of these conflicts arose from concerns about using water for hydraulic fracturing, especially given a lack of established research on questions such as source water sustainability, potential toxicity of wastewater fluids, impacts on groundwater resources, and seismic activity.1,2,3,4 However, the conflicts over water also raised questions about the applicability of multi-actor decision-making processes with Indigenous nations. Many collaborative decision-making processes in the past have treated Indigenous peoples simply as stakeholders, thus ignoring their authority as nations, and their constitutionally protected rights. Past failed attempts by settler governments and industry to engage with Indigenous nations in decision-making highlighted the need for innovative approaches to ensure water decisions respect and acknowledge the rights and authority of all nations.

Fort Nelson First Nation (FNFN) is a Cree and Dene community with 700+ members, many of whom continue to reside in northeastern BC and are deeply embedded in traditional subsistence practices. Their traditional lands span from the Alberta border to the borders of Yukon and Northwest Territories (see figure 1), overlapping with the Horn River and Liard River Basins. Three of the four gas reserves in BC are entirely located in the Nation’s territory, and the fourth reserve overlaps (see figure 1).5

MICHELE-LEE MOORE, KARENA SHAW, ROSANNA BREIDDAL, AND MATHEW MURRAY, UNIVERSITY OF VICTORIA Research conducted 2013-2015

FROM HYDRAULIC FRACTURING CONFLICTS TO INNOVATION GENERATION: A CASE STUDY OF WATER GOVERNANCE IN NORTHEASTERN BRITISH COLUMBIA

Figure 1. Map of the shale gas plays overlapping Fort Nelson First Nation traditional territories (Map source: FNFN Lands Department)

Water Economics, Policy and Governance Network and Canadian Water Network | Report published March 2017 1

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Fort Nelson First Nation became a member of Treaty 8 in 1910. The signing of the treaty was an agreement between FNFN and the Crown about how the land would be shared and governed and who would use and govern the land going forward. However, since the treaty’s signing, the Crown and the Nation’s interpretations of what was agreed upon have diverged. Today, the Nation’s members are concerned that the governance frameworks for tenure rights and water allocation for hydraulic fracturing do not respect or protect their treaty rights or their rights to self-determination.6 There has been an ongoing deadlock between the Province and the Nation regarding resource development negotiation and consultations.7 The Nation has been seeking alternative water governance models, with an expectation for more inclusive, socially, ecologically, and culturally responsible governance.

WHAT DID WE DO?This 2013-2015 project investigated the opportunities and conditions for water governance innovation in the Horn River Basin. To accomplish this, we examined:

1. Existing opportunities for social and collaborative learning in the Horn and Liard River Basins among Fort Nelson First Nation, government, and industry, since social learning is understood to be an essential process in the development of governance innovations, and

2. Existing water governance models that bring together provincial, federal, industry and Indigenous decision makers, with a specific focus on co-management, collaborative governance, and impact benefit agreement models.

Over six weeks, the research team collected data through one-on-one interviews and participant observation in the Fort Nelson First Nation traditional territories with members of the Nation, provincial government, and industry operators. Over the next several months, we conducted document analysis of government strategy documents, transcripts of an Environmental Appeal Board hearing between Fort Nelson First Nation, provincial government, and one company, and strategic planning documents from the Fort Nelson First Nation Lands Department.

WHAT DID WE FIND?

SHALE GAS AND WATER GOVERNANCE IN BCShortfalls in the current management approach for shale gas and water resources have contributed to negative perceptions held by FNFN. These shortfalls include information deficits such as insufficient ecological and hydrological information and the lack of cumulative effects assessment.8 A permit-by-permit authorization approach for land and water use was identified as a fundamental problem as it does not sufficiently plan for long-term impacts. In this approach the individual components of a larger project are approved without consideration for how they will add to the broader development picture across the landscape over space and time. This is critical as there is currently no mechanism to account for how past, present, and future development will cumulatively impact the ability of current FNFN members and coming generations to meaningfully practice treaty rights and relate to the land.

The consultation process between the provincial government and FNFN is perhaps one of the most problematic aspects of the current management regime. Study participants noted that existing approaches do not sufficiently include Indigenous Knowledge, and that site-specific consultation does not consider First Nations’ use and relationship with their land at appropriate temporal and spatial scales. In addition, the final decision making authority lies with the Province, creating a governance process that, for FNFN, is distant and disconnected and has resulted in FNFN members feeling unable to exercise their authority in the governance process.

FROM HYDRAULIC FRACTURING CONFLICTS TO INNOVATION GENERATION: A CASE STUDY OF WATER GOVERNANCE IN NORTHEASTERN BRITISH COLUMBIAMichele-Lee Moore, Karena Shaw, Rosanna Breiddal, and Mathew Murray, University of Victoria, Research conducted 2013-2015

Water Economics, Policy and Governance Network and Canadian Water Network | Report published March 2017 2

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SOCIAL LEARNING PROCESSES IN RELATION TO WATER GOVERNANCE AND HYDRAULIC FRACTURINGWhat exactly is problematic with the consultation process? Our study revealed that the implementation of the Crown’s “duty to consult” may prevent social learning from occurring amongst industry, the provincial government, and the Fort Nelson First Nation. Based on our analyses, three specific conditions necessary for social learning were hindered by the current approach to consultation:

1. Reframing processes: Previous research on social learning has demonstrated actors involved in learning together must go through a “reframing process” so shared understandings of the problem exist.20,21,22,23 Our study highlighted the substantial differences in the government and Fort Nelson First Nation’s understanding of what being a Treaty 8 signatory means for both nations. Currently, the provincial government exerts authority to approve water use through its licensing process. When provincial governments must determine if water use for hydraulic fracturing activities affects Treaty rights, there is no basis of agreement about what those rights involve. A process that would allow a new, collective understanding of what Treaty 8 involves and how provincial governments, Indigenous nations, and industry may carry that out in practice today has not occurred;

2. Legitimacy and trust: The manner in which FNFN is included in decision-making through consultation processes lacks legitimacy, for three reasons: i) FNFN participants do not feel empowered as decision-makers. Decisions that they do not agree with continue to be made, despite their stated significant concerns; ii) the data used to make decisions is not sufficient in quantity or quality; and iii), the decision-making process is not transparent and it remains unclear by whom or when their input is considered;

3. Neutral facilitation: Social learning processes require a neutral facilitator,23,24 but current consultation processes are facilitated by the provincial government, who is viewed by many of the FNFN participants in this study as being “captured” by industry and economic interests (in part due to their clearly stated policies and intentions to expand the industry), and thus unwilling or unable to protect other social and ecological values.

Therefore, for the FNFN, consultation processes are a critical mechanism for ensuring their constitutional and treaty rights, and government-government relationships are upheld. However, the current practices for undertaking consultation contribute to barriers for collaboration and social learning.

FROM HYDRAULIC FRACTURING CONFLICTS TO INNOVATION GENERATION: A CASE STUDY OF WATER GOVERNANCE IN NORTHEASTERN BRITISH COLUMBIAMichele-Lee Moore, Karena Shaw, Rosanna Breiddal, and Mathew Murray, University of Victoria, Research conducted 2013-2015

Water Economics, Policy and Governance Network and Canadian Water Network | Report published March 2017 3

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THE VALUE OF CO-MANAGEMENT FOR THE FORT NELSON FIRST NATIONFort Nelson First Nation was exploring co-management as a potential governance model during the time of this study. Co-management is one optional governance arrangement where First Nations and provincial or federal governments participate cooperatively, often organized through boards or committees structures, to govern natural resources, or to share responsibilities for some aspect of management, such as land use planning, wildlife management, impact assessment, or water management.9 As observed through other applications, the benefits of this type of approach could include protection of treaty rights, increased environmental protection by addressing weaknesses in current governance regimes, and adequate authority over the pace and scale of shale gas development in their territory.10,11,12,13 The Nation envisions a co-management approach that employs large scale planning and management, cumulative effects assessment, expanded environmental monitoring and data collection, and industry compliance and enforcement monitoring. A co-management approach could potentially safeguard the Nation’s ability to ensure that governance is grounded in local values and interests.

However, such an approach is not unproblematic, and faces numerous challenges if it is to be effective. Firstly, not all would agree that partnering with the state in a governance agreement premised on sustaining intensive resource extraction would necessarily yield the type of community development that is beneficial to Indigenous cultures over the long-term.14 Secondly, issues related to empowerment and equality remain. As previous research suggests, co-management does not guarantee meaningful First Nations authority or inclusion of Indigenous Knowledge, nor does co-management represent self-determination and autonomy.15 The intended “equal” authority of Indigenous co-managers is often undermined when co-management boards are placed under Ministers within colonial institutions.16,17 At the very least, these analyses suggest the costs and benefits of doing co-management require careful consideration.

Therefore, while the Fort Nelson First Nation identified co-management as a potential model to achieve its goals, there are some anticipated challenges with moving forward. In Canada, the co-management experience is mostly limited to renewable sectors like forestry, fisheries and wildlife management. Therefore, it is uncertain how FNFN could manage the different incentive structures between non-renewable and renewable resources that create the propensity for boom and bust patterns. The companies involved in hydraulic fracturing are expected to pursue, above all else, high profits and high returns on investment for their shareholders, so it is especially advantageous to increase rates of production when the price of any non-renewable resource is deemed to be high.18 Such a development pattern conflicts with the community’s interest in a more stable, local economic opportunity, and a more carefully planned and ecologically accountable industry. Additionally, the history of mistrust within a politically-charged framework further challenges any movement towards an arrangement such as co-management.

MOVING TOWARD GOVERNANCE INNOVATION A governance innovation is defined as any strategy, program, policy, process or initiative that transforms the standard routines, resource and authority flows, or norms, beliefs, and values of the governance system in which the innovation occurs.19 In the absence of a perceived openness to innovation on the part of the provincial government, Fort Nelson First Nation piloted a new approach to governance that would bypass government consultation and create the opportunity to influence industry’s decision-making process directly. In this arrangement, the Nation played an effective role in project management at an early stage of project development (i.e. seismic testing) that included design, implementation and operations. The Nation ensured it would benefit financially on a fee-for-service basis by conducting environmental impact assessments and traditional use studies. Ultimately, this innovation would result in increased confidence by government and industry stakeholders that FNFN’s concerns and approval were being considered from the beginning. Still, such innovations are susceptible to the volatility in price and in activity: as soon as a “bust” occurred in the once booming industry, the company that had agreed to pilot this new approach sold their assets, and FNFN is left to start all over with the next proponent proposal for development on its lands. Thus, the one potential innovation proved only to be temporary.

FROM HYDRAULIC FRACTURING CONFLICTS TO INNOVATION GENERATION: A CASE STUDY OF WATER GOVERNANCE IN NORTHEASTERN BRITISH COLUMBIAMichele-Lee Moore, Karena Shaw, Rosanna Breiddal, and Mathew Murray, University of Victoria, Research conducted 2013-2015

Water Economics, Policy and Governance Network and Canadian Water Network | Report published March 2017 4

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WHAT DOES THIS MEAN FOR DECISION MAKERS?Water use for hydraulic fracturing on FNFN’s traditional territories must be consented to by FNFN, and must meet social, cultural, and ecological objectives. Our study confirms what is already widely recognized but not yet practiced: existing processes of consultation are inadequate and may in fact be hindering the opportunity for social learning and collaboration processes. Co-management models are one option that FNFN has considered for moving forward to ensure their governing authority is recognized in practice. In Canada, the co-management experience is mostly limited to renewable sectors like forestry, fisheries and wildlife management. Without precedents, it is very difficult to predict the implications for water governance. But any model that honours Indigenous decision-making authority to water will need to ensure it recognizes Fort Nelson First Nation’s treaty rights, including an attentiveness to the temporal and spatial scale of land use.

More innovative arrangements have been tested that included Indigenous control over data collection and sharing, what values will be assessed during EIA processes, and payment for Indigenous services provided, which ensures that Indigenous knowledge is not yet another resource being extracted. Yet, without strong institutional support, these arrangements are temporary and at the whim of the willingness of certain companies. While some industry actors have been willing to work together with FNFN on new models, uncertainty exists about the willingness of others. But FNFN hopes to continue to test novel approaches as they work towards governance reform in their territory.

The Water Economics, Policy and Governance Network’s (WEPGN) overarching goal is to build knowledge and facilitate exchange between social science researchers and partners, thereby increasing the application of research to decision making and enhancing water’s sustainable contribution to Canada’s economy and society while protecting ecosystems. WEPGN was established with a SSHRC Partnership Grant. WEPGN’s objectives are to:

p Create a vibrant and multidisciplinary network of Partnerships amongst researchers, government agencies and community groups;

p Provide Insight by mobilizing knowledge from social science perspectives to improve our understanding of water’s role in Canadian society and economy;

p Strengthen Connections by facilitating a multidirectional flow of knowledge amongst researchers and partners to promote more efficient and sustainable water management;

p Provide high quality Training experiences for students and practitioners with interests in water policy decision-making and management.

This project by Moore et al. contributes to each of the above objectives, and is a notable example of a project that strengthens connections between researchers and partners to create and share knowledge that promotes efficient and sustainable water management.

TO CONTACT THE RESEARCHER, EMAIL [email protected]. VISIT OUR REPORT LIBRARY AT WWW.CWN-RCE.CA

FROM HYDRAULIC FRACTURING CONFLICTS TO INNOVATION GENERATION: A CASE STUDY OF WATER GOVERNANCE IN NORTHEASTERN BRITISH COLUMBIAMichele-Lee Moore, Karena Shaw, Rosanna Breiddal, and Mathew Murray, University of Victoria, Research conducted 2013-2015

Water Economics, Policy and Governance Network and Canadian Water Network | Report published March 2017 5

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REPORT AUTHORED BY: DR. MICHELE-LEE MOORE, DR. KARENA SHAW, ROSANNA BREIDDAL, MATHEW MURRAY, AND KATHRYN TEBBUTT

RESEARCH TEAM

DR. MICHELE-LEE MOORE, University of VictoriaDR. KARENA SHAW, University of Victoria

ROSANNA BREIDDAL, University of VictoriaMATHEW MURRAY, University of Victoria

PARTNERS

FORT NELSON FIRST NATION LANDS DEPARTMENT

REFERENCES1 RUBINSTEIN, J. L., AND A. BABAIE MAHANI (2015). Myths and facts on wastewater injection, hydraulic fracturing, enhanced oil recovery, and induced seismicity. Seismology Research Letters, 86(4): doi: 10.1785/0120150067.2 KONSCHNIK, K.E., AND M.K. BOLING. 2014. Shale Gas Development: A Smart Regulation Framework. Environmental Science & Technology 48(15): 8404–16.3 TURCOTTE, D. L., MOORES, E. M., AND J.B. RUNDLE. (2014). Super FRACKING. Physics Today, 67(8): 34-39.4 VENGOSH, A., JACKSON, R. B., WARNER, N., DARRAH, T. H., AND A. KONDASH. (2014). A Critical Review of the Risks to Water Resources from Unconventional Shale Gas Development and Hydraulic Fracturing in the United States. Environmental Science and Technology, 48(15): 8334-8348.5 PROVINCE OF BRITISH COLUMBIA. (2015). FACTSHEET: Hydraulic Fracturing in British Columbia. Ministry of Natural Gas Development. Accessed Nov 2015: https://news.gov.bc.ca/factsheets/factsheet-hydraulic-fracturing-in-british-columbia.6 GARVIE, K.H. AND K. SHAW. (2014/15) “Oil and Gas Consultation and shale gas development in British Columbia” BC Studies: Vol. 184 (Winter): 73-102.7 USHER, P. J. (1997). Common property and regional sovereignty: relations between Aboriginal peoples and the Crown in Canada. In Larmour, P. (ed) The Governance of Common Property in the Pacific Region (pp. 103-122). Canberra, AUS: Australian National University. 8 GARVIE, K.H., LOWE, L. AND K. SHAW. (2014). Shale Gas Development in Fort Nelson First Nation Territory: Potential Regional Impacts of the LNG Boom. BC Studies Vol. 184 (Winter): 45–51, 53–61, 63–72,183–184. 9 USHER, 1997; CASTRO A.P, AND E. NIELSEN. (2001). Indigenous people and co-management: implications for conflict management. Environmental Science & Policy, 4 (4): 229-239.10 H. SPIRO MABEE & G. HOBERG (2006) Equal Partners? Assessing co-management of forest resources in Clayoquot Sound, Society and Natural Resources, 19(10): 875-888.

11 SCOTT, C. H. (2005). Co-Management and the Politics of Aboriginal Consent to Resource Development: The Agreement Concerning a New Relationship between Le Gouvernement du Québec and the Crees of Québec (2002). Canada: The State of the Federation, 133.12 SPAEDER J.J., AND H.A. FEIT. (2005). Co-management and indigenous communities: barriers and bridges to decentralized resource management: introduction. Anthropologica, 47 (2): 147-154.13 GOETZE T.C. (2005). Empowered co-management: towards power-sharing and indigenous rights in Clayoquot Sound, BC. Anthropologica, 47(2): 247-265.14 COULTHARD, G. (2013). For Our Nations to Live, Capitalism Must Die. Nations Rising. Retrieved from http://nationsrising.org/for-our-nations-to-live-capitalism-must-die.15 NADASDY, P. (2003). Reevaluating the Co-Management Success Story. Arctic, 56(4), 367– 380; Nadasdy, P. (2005). Hunters and bureaucrats: power, knowledge, and aboriginal-state relations in the southwest Yukon. Vancouver, BC: UBC Press.16 WHITE G. (2008). ”Not the Almighty”: Evaluating Aboriginal Influence in Northern Land-Claim Boards. Arctic Jan(1): 71-85.17 WHITE G. (2006). Cultures in collision: traditional knowledge and Euro-Canadian governance processes in northern land-claim boards. Arctic, 59 (4): 401-419.18 BRIDGE, G. (2008). Global production networks and the extractive sector: governing resource-based development. Journal of Economic Geography, 8(3): 389-419.19 MOORE, M-L, VON DER PORTEN, S., PLUMMER, R., BRANDES, O.M., AND J. BAIRD. 2014. Water policy reform and innovation: a systematic review. Environmental Science and Policy, 38(1): 263-271.20 MURO, M., AND P. JEFFREY. 2008. A critical review of the theory and application of social learning in participatory natural resource management processes. Journal of Environmental Planning and Management 51:325-344

21 REED, M. S., A. C. EVELY, G. CUNDILL, I. FAZEY, J. GLASS, A. LAING, J. NEWIG, B. PARRISH, C. PRELL, C. RAYMOND, AND L. C. STRINGER. 2010. What is social learning? Ecology and Society 15(4): r122 PAHL-WOSTL, C., M. CRAPS, A. DEWULF, E. MOSTERT, D. TABARA, AND T. TAILLIEU. 2007. Social learning and water resources management. Ecology and Society 12(2): 5. [online] URL: http://www.ecologyandsociety.org/vol12/iss2/art5/23 BOUWEN, R. AND TAILLIEU, T., 2004. Multi-party collaboration as social learning for interdependence: Developing relational knowing for sustainable natural resource management. Journal of community & applied social psychology, 14(3), pp.137-153.24 MOSTERT, E., PAHL-WOSTL, C., REES, Y., SEARLE, B., TÀBARA, D. AND TIPPETT, J., 2007. Social learning in European river-basin management: barriers and fostering mechanisms from 10 river basins. Ecology and Society, 12 (1), 2007.  Several studies have also raised concerns about the ecological and public health risks linked to surface and groundwater contamination resulting from hydraulic fracturing activities in other regions, see Entrekin, S., Evans-White, M., Johnson, B., and E. Hagenbuch. (2011). Rapid expansion of natural gas development poses a threat to surface waters. Frontiers in Ecology and the Environment, 9(9): 503-511; Osborn, S. G., Vengosh, A., Warner, N. R., and R.B. Jackson. (2011). Methane contamination of drinking water accompanying gas-well drilling and hydraulic fracturing. Proceedings of the National Academy of Sciences, 108(20): 8172-8176; Rozell, D. J., and S.J. Reaven. (2012). Water pollution risk associated with natural gas extraction from the Marcellus Shale. Risk Analysis, 32(8): 1382-1393; Elliot, E.G., Ettinger, A.S., Leaderer, B.P., Bracken, M.B., and N.C. Deziel. (2016). A systematic evaluation of chemicals in hydraulic-fracturing fluids and wastewater for reproductive and developmental toxicity. Journal of Exposure Science and Environmental Epidemiology, 1: 1-10.

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FROM HYDRAULIC FRACTURING CONFLICTS TO INNOVATION GENERATION: A CASE STUDY OF WATER GOVERNANCE IN NORTHEASTERN BRITISH COLUMBIAMichele-Lee Moore, Karena Shaw, Rosanna Breiddal, and Mathew Murray, University of Victoria, Research conducted 2013-2015

Water Economics, Policy and Governance Network and Canadian Water Network | Report published March 2017 6