EDITORIAL PAGE — Saskatchewan royalties?

Much attention has been drawn to the proposed royalties on metal mines in the United States. There, the House of Representatives has passed a bill calling for an 8% net smelter royalty on mines situated on federal lands.

Gone virtually unnoticed, however, is a not dissimilar call for a revenue-sharing formula on Saskatchewan uranium mines. This was one of many recommendations made by the Joint Federal-Provincial Panel on Uranium Mining Developments in Northern Saskatchewan, and it certainly ranks as the most significant — and unusual — new proposal in Canadian mining. In October, the panel rejected developing the Midwest Joint Venture. It also called for a minimum 5-year delay of the McClean Lake project but accepted the Dominique-Janine extension, which is part of the existing Cluff Lake mine. (The mere fact the panel recommended a 5-year delay on McClean Lake is unprecedented in itself. Here we have a government-empowered committee — not the mining company — determining the timing of mine development, and the decision is based on considerations much broader than mere economics and environmental impact. It would appear this is the logical outgrowth of the democratic effort to include all “stakeholders” in the decision-making process. It could, however, have dire consequences.

Had such a panel recommended Denison and Rio Algom delay development of their uranium deposits for five years, there might never have been an Elliot Lake and the billions of dollars that community contributed to Ontario’s economy. Denison, Rio and a few other companies developed their properties in 1956-57 or thereabouts; a short five years later, uranium supply contracts, primarily with the U.S., dried up. That late-’50s development window would have slammed shut in the face of a 5-year postponement, such as is recommended with McClean Lake.)

But it is the call for revenue-sharing (we suppose some form of net smelter return payable to local communities or an affected region) that is potentially unsettling for the region, and potentially onerous for the mining industry.

Advanced under the heading “General Issues and Recommendations,” the joint panel’s argument for revenue-sharing goes something like this: a substantial portion of the socio-economic benefits from uranium mining should accrue to residents of northern Saskatchewan. Why? Because, historically, natives, who form the bulk of the northern population, have been forced to change from nomadic hunters to fur-trappers and traders to miners or foresters. This has proved an unfairly difficult transition. Since the past is unalterable, we must change the present. The question is: What can be done now to redress the imbalance? Since residents of northern Saskatchewan had been denied ownership of resources in the past, outright or joint ownership — or, at the very least, an “equitable form of revenue-sharing” — would rekindle this lost sense of dignity and responsibility.

So the panel recommended that “no new uranium mining developments be undertaken until a form of revenue-sharing” is agreed upon.

The principle is a noble one and not entirely new. The argument that more benefits should accrue to the communities, usually northern, that host the mines is as old as Canadian mining itself.

The federal government will deal with this and other panel recommendations before year’s end, we are told. It will be interesting to see how it handles them.