Friday, October 2, 2015

Indigenous People Seeking to Profit from Fossil Fuels

It is a sad irony but some indigenous people on the front lines of ecological degradation are benefiting from those who destroy their lands to extract fossil fuels. While many aboriginal communities are at the forefront of efforts to stop fossil fuel exploitation, others are looking to benefit financially from hydrocarbon exploitation as they try to contend with the loss of their traditional ways of life.

Two cases in point are the tar sands in Alberta Canada and Arctic drilling off the coast of Alaska. The savage irony is that as their traditional ways of life are being destroyed by global some native people are looking to the very system that contributes to pollution and created the climate crisis.

According to the Canadian Association of Petroleum Producers more than 1,700 Aboriginal people are employed in the tar sands and Aboriginal companies have earned over $8 billion in revenue through working relationships with the oil sands industry.

Wood Buffalo and Lac La Biche Aboriginal companies performed over $1.8 billion in contract work with OSCA member companies in 2012. The Fort McKay Group of Companies (FMGC), which works extensively with oil sands companiesthrough its six limited companies, brings in more than $100 million in revenue annually and is completely owned and controlled by the Fort McKay First Nation. Shell, as operator of the Athabasca Oil Sands Project (AOSP)has spent over $1.25 billion with Aboriginal contractors since 2006.

The fossil fuel industry also pores money into some of these communities as a way of offsetting dissent. In 2011 and 2012, oil sands companies contributed more than $20 million to aboriginal communities in the Wood Buffalo and Lac La Biche regions for school and youth programs, celebrations, cultural events, literacy projects and other community programs.

Syncrude is one of 13 companies in Canada, and the only oil sands operator, to be accredited at the Gold Level in the Progressive Aboriginal Relations (PAR) Program of the Canadian Council for Aboriginal Business (CCAB). PAR measures corporate performance in Aboriginal employment, business development, capacity development and community relations. Numerous scholarships and bursaries are available for Aboriginal students through oil sands producers.

However, as the number of tar sands projects dwindles due to low oil prices, so have the financial benefits to native businesses and communities.

As reported recently in the Washington Post, some of Alaska's indigenous people invested in Shell's Arctic misadventures because they claimed they were trying to hedge against the loss of their traditional lifestyle due to climate change.

Rex A. Rock, Sr., president of the Arctic Slope Regional Corporation (ASRC), a consortium of Alaska Native companies that recently invested in Shell’s oil prospects, said in a statement that he was "deeply disappointed" with the news from Shell.

The savage irony here is that these investment were intended to benefit from opportunities in the wake of the loss of their traditional activities due to climate change. As explained in the post: "The leaders of ASRC said they had invested in Shell’s venture because of concerns that climate change would make it more difficult to sustain their traditional whaling and fishing based economy."

As we now know Shell has abandoned its drilling operation in the Arctic. This means that those local Alaska Natives who invested in Shell's misadventure, have nothing to show for their efforts.

Image credit: Imperial Oil

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