Strateco may use NAFTA to sue over Matoush uranium rejection

The Quebec government informed Strateco Resources November 8 that the company would not be granted a certificate of authorization for the company’s plan of underground uranium exploration on traditional lands near Mistissini.

In response, Strateco CEO Guy Hébert told reporters, several of the company’s investors will sue the Canadian government under Chapter 11 of the North American Free Trade Agreement. The controversial NAFTA clause allows foreign investors to contest government decisions that harm their economic interests.

The decision to reject the Strateco project didn’t come as a surprise. Quebec environment minister Yves-François Blanchet had said last June that he planned to oppose the authorization because of the project’s lack of social acceptability among Crees. But surprise or not, the move from the Quebec government was well-received by the Grand Council of the Crees (GCC).

“We’re very happy about it,” said GCC Executive Director Bill Namagoose. “We hope the project will be canceled, because the Cree Nation has taken a position against it, and the minister has said that this is not socially acceptable. The model for the lack of social acceptability was the Paix Des Braves: it was accepted by the Cree public and it became the policy. That’s the model that was applied to the Matoush project and the rationale they used [in refusing the authorization].”

The decision came a week before the 40th anniversary of Justice Albert Malouf’s 1973 decision granting the Crees an injunction in their fight against the La Grande, Great Whale River, and NBR hydroelectric projects.

“It wasn’t a government or ministerial decision; it was a court decision, which are all subject to appeal,” Namagoose remembered. “So the government appealed and we lost – the Malouf judgment was overturned four days later. But it catapulted the Crees into a much stronger position – when Quebec and Canada were saying that we had no rights, that we were just squatters, and the Crees weren’t really Crees because we ate pizza!”

Namagoose notes that the Matoush decision was made within the framework of social acceptability laid out by the James Bay Northern Quebec Agreement (JBNQA), to which the Malouf decision was foundational. Strateco’s Guy Hébert has argued that Crees should have no right of veto over Category III JBNQA lands, which reminds many of the James Bay dispute.

Namagoose added that the JBNQA will remain integral to discussions of the Matoush project, especially because of the possible NAFTA lawsuit

NAFTA’s controversial Chapter 11 allows corporations or individuals to sue the governments of the United States, Canada and Mexico for damages if they believe that a government’s decision has hurt their ability to profit from investments in that country. It has always been the most furiously debated section of NAFTA, and was often described in the late 1990s and early 2000s as the catalyst for that period’s wave of anti-globalization protests.

“It’s totally ridiculous,” said Namagoose, who added that the impulse to resort to NAFTA “seems like a sign of desperation.”

However desperate, he said, NAFTA exists and the Grand Council was not prepared for a challenge on that level.

“Strateco using NAFTA to impose something in the Cree world is totally unacceptable,” he said. “We’re not a party to NAFTA, but we’re subject to it. It seems everybody in Canada is subject to it. But we didn’t agree to NAFTA. Our review process – the JBNQA review process – rejected the Matoush mine. Now the Quebec government has also said they won’t give the permit because of a lack of social acceptability.”

Strateco has repeatedly said that it has invested nearly $125 million in the project, and its responsibility is not to reflect the project’s social acceptability but to make sure its investors profit from it. According to the National Post, Strateco’s biggest investors are “Cayman Islands-based private equity firm The Sentient Group, Toronto-based boutique investment management firm Goodman & Co., and [the] Bank of Nova Scotia,” while Hébert has said that the company is also backed by US pension plans.

Said Namagoose, “You’ve got these capitalists from Canada, the United States and Mexico, saying, ‘Wait a minute, we have a significant investment in Strateco that should prevail over your human rights.’ [NAFTA] can be used for anything in the commercial, capital world: if capitalists don’t like what the government is doing, they can come down heavy on them with NAFTA.”

Dealing with NAFTA is entirely new territory for the Grand Council of the Crees, but Namagoose stresses that the GCC, who have aggressively defended Cree sovereignty at all other legal levels, will fight against any attempt to use NAFTA against the will of the Cree Nation.

“We don’t even know what the process is. This is totally new,” he said. “Of course, we will challenge it. We’ll protect what the Cree people want.”