Iron ore and fiber optics in the works for Nunavut

Nunavut, Canada is home to a wealth of mineral resources, yet it suffers from a dearth of high-speed internet. New developments in both of those areas could bring big changes to the territory.

First, after four years of assessment and analysis, the Nunavut Impact Review Board (NIRB) approved the Mary River iron mine on Baffin Island, in the northernmost part of Nunavut. 200 terms and conditions were included in the Final Hearing Report, CBC News reports. The Board’s mission is to “protect and promote the existing and future well being of the residents and communities of the Nunavut Settlement Area, and to protect the ecosystem integrity of the settlement area.” With the Mary River iron mine, some of the NIRB’s primary concerns included noise, pollution, and potential oil spills from shipping the iron ore out of Steensby Inlet. The construction of a railway, which will be Canada’s most northern, to transport the ore from the mine to the port is another area of concern. Tailings and effluent also need to be stored properly.

The Makivik Corporation, which promotes the preservation of Inuit culture in Quebec, requested a separate review of the mining project by the Nunavik Marine Region Impact Review. However, it did not receive the green light. According to a presentation given on the final hearing on July 19, Makivik believes that the mining project “will have significant adverse effects on Nunavik.” They want the shipping route to be modified, as they believe that from time to time, Baffinland’s icebreaking freighters could sail into the Nunavik Settlement Region (NSR). The NSR lies on the Quebec side of the Hudson Strait, through which the ore would be shipped on its way to Europe. Even if the ships did not cross over into their region, the volume of shipping could still impact species on which they are dependent for subsistence, such as seals and bowhead whales. NIRB’s approval mandates a maximum of 20 ship transits a month and no more than 242 per year, which is still a huge amount, as that equates to a ship going out or coming in at least every other day with iron ore.

While mining will help Nunavut economically, it will also put extra burdens on their already oversubscribed infrastructure. The report stated it best:

“As recognized by all the participants in this Review, there is no question that the Mary River Project Proposal has the potential to contribute significant economic benefits to the North Baffin Region, the Government of Nunavut, the Federal Government and the resource and land owners, NTI and the QIA. Although the Board recognizes that it is difficult to quantify, at this point, the exact value of these benefits given the many variables that will affect the actual value of the net benefits received, even assuming the actual economic benefits that result are at the very conservative end of the range, the potential economic benefits remain positive and significant. However, as noted during the Hearing, it must be kept in mind that the potential positive economic benefits must be viewed in context, with the recognition that the Project would result in additional costs imposed on federal, territorial, regional and local governments to address project effects, such as increased pressure on regional housing supplies, policing/justice requirements and strains on infrastructure such as local airports.”

Local communities often have to essentially pay out of their own pockets first before they realize any of the benefits from mining. Their environment will be changed and their infrastructure will be strained before any revenue is even generated, which is a concern of NIRB’s. This could make the first few years of the project quite contentious. Some sort of benefits package has been recommended to help ease the transition for Pond Inlet from being a small, mainly Inuit settlement of approximately 1,500 people to being near the center of one of the world’s largest iron mines. Thousands of employees will be hired to construct the mine, too, which will certainly tax the settlement’s infrastructure and support systems. Even though Baffinland will construct housing for its employees, they will still likely make use of the settlement’s sparing entertainment and dining facilities. Family members may visit, but there seems to be only one hotel and one bed and breakfast (with three rooms) in town. To cope with the new developments, some residents want an international airport and a port. Pond Inlet is a stunning and remote little settlement (pictures on Flickr) and it will be interesting to see how it changes if construction indeed moves forward on the mine. Final approval of the mine, expected to cost $4 billion to construct, still rests with the Minister of Aboriginal Affairs and Northern Development, John Duncan.

The mine will undoubtedly bring in huge profits for the Inuit if all goes according to plan because the Mary River mine lies on land for which the Nunavut own subsurface rights. In Canada, subsurface rights tend to be owned by the Crown, but when the Inuit were negotiating their land claims agreement with the federal government, they were able to take possesion of subsurface rights in 2 percent of their territory. They wisely chose those areas based on where mineral deposits existed, and one of those sites was on Baffin Island. The main obstacle to the mine being built is probably not the government but rather the global recession. With iron ore prices hovering around their lowest prices since 2009, companies around the world are cutting back large-scale mining projects. There is a small chance the Mary River mine could go the way of the Mackenzie Valley Pipeline, which went through decades of government hearings, only to receive approval when natural gas prices were so low as to make the project economically unfeasible.

Another thing to consider as resource extraction gains traction in the Arctic is its impact on the community members themselves. Educational and career opportunities are very limited. Many people can gain training to work in mines and in related support areas, but it’s easier if the person being trained is young and willing. Older community members may find it harder to receive re-training for a new career, especially in the demanding, labor-intensive mining industry. When royalty payments are disbursed to community members, they can often be flush with cash but not have anything in which to invest. Alcoholism, suicide, and child mortality are all higher than average in Canada’s north. An influx of money doesn’t solve these problems; they are much more complex than that. Nunavut has recently been looking to Greenland as an example of a fairly successful place that still cherishes and promotes its indigenous culture. The Globe and Mail reports that Greenland generates 60 percent of its revenue internally, while Nunavut only generates 7 percent. The rest of the money comes from Copenhagen and Ottawa, respectively.

Yet one development that could signify progress in northern Canada would be the arrival of high-speed, fiber optic internet. There has been talk for several years about installing such a cable between Asia and Europe via the Northwest Passage; I wrote about plans by Arctic Fibre and Polarnet Project in January 2012. Arctic Fibre is stepping up to the plate and publicizing its plans to construct a cable between Tokyo and London. A signal would take 158 milliseconds seconds to travel between the two financial centers, making it 29 milliseconds faster than the normal routings through the Pacific and Atlantic Oceans. Telemedicine and easy videoconferencing between residents in Nunavut with doctors and hospitals in the south without annoying lagtimes would improve quality of life for northerners. Greenland already enjoys access to a fiber optic cable called Greenland Connect, which goes between Newfoundland, Greenland, and Iceland with a capacity of 1.10 Gbps. Residents in most of Nunavut, on the other hand, have to get by with painstakingly slow and unreliable internet. Researchers in Canada’s Arctic stations also have to rely on the satellite network, so high-speed broadband internet would be a big technology boost for them. The arrival of broadband internet in various parts of Africa over the past couple of years has served to help more people quickly get online, allowing them a whole host of new social and economic opportunities. This December, the Africa Coast to Europe Cable, which will begin in France and terminate in South Africa, with spur lines connecting to 18 Africa countries along the way, will launch with internet speeds of 5.12 Tbps. More people will be able to have smartphones and do everything from online banking to teleconferencing.

Greenland and Africa are ahead of northern Canada in the quest for high-speed internet. Northern Canada should not be left behind when it comes to infrastructure that can promote social and economic development. While indigenous traditions should still be supported, there is no reason for the communities to be left in the dark, relying only on shaky satellite internet. For a long time, companies have avoided building a fiber optic cable in the Northwest Passage because of the high costs and little revenue that would be generated. Yet as more and more companies come to do business in the territories, it makes sense to have high-speed internet to complement their activities. At the same time, as more opportunities come to the north, whether in the form of resource extraction or high-speed internet, it will be important to make sure that the transition is made while consulting the local residents. Change can be good and bring many benefits, but overly rapid change often comes at a cost.

News Links

“Arctic undersea cable could end Nunavut’s dependence on satellites,” Nunatsiaq Online

“Nunavut Board says Yes to Mary River with Conditions,” Nunatsiaq Online

“Baffinland Iron Arctic iron ore mine project reaches milestone,” Steel Guru