Imperial Metals, the owner of the Mount Polley and Red Chris copper-gold mines in British Columbia, is “totally on the brink” of bankruptcy according to a mining accounting expert.

“They’re not even close to making money,” Thomas Schneider, an expert on financial reporting of environmental liabilities and assistant professor of accounting at Ryerson University, told The Narwhal. “It’s just a matter of ‘can this company make enough cash flow.’ And they’re just coming off a strike.”

“This company is on the brink,” he added. “There’s no two ways about it.”

Imperial’s share price was at press time $1.33, down from over $18 per share in early 2014.

The company is currently surviving on debt, paying $75 million per year in interest expense. Interest payments are being made by issuing shares to creditors rather than cash — yet another bad sign. Recently, Imperial issued 3.1 million shares valued at $1.97 each to pay off interest of $6.1 million. But shares are now $1.33, meaning that similar attempts may require the issuing of even more shares to pay interest, which could lead to dilution and an even lower share price.

Schneider said that it “looks to me like a downward spiral.”

The company’s latest quarterly financial statement reported a net loss of $36.6 million. These losses were blamed primarily on the recent two-month strike at Mount Polley and lower-than-expected recovery at Red Chris, exacerbating an already weak financial position from a few years of low copper prices and the sizable impacts of the tailings disaster.

Copper prices have continued to decline since the start of the trade war between the United States and China in early July.

The big date that Schneider said to watch is October 1: by then, the company needs to have re-negotiated a $200-million credit facility — a type of loan from investors — some $44.1 million of which is currently used to secure letters of credit for reclamation costs at its mines.

If the group of creditors decide to walk away rather than continue finance the struggling company, Schneider said Imperial Metals will suddenly face massive unfunded reclamation costs.

In a recent conference call with investors and analysts, Imperial’s chief financial officer said: “We are in discussions with our lenders and continue to work on financing alternatives and solutions for this debt.”

Imperial Metals did not respond to multiple requests for comment.

‘Holy cow, what are we financing?’

A spokesperson for the B.C. ministry of energy, mines and petroleum resources said in an e-mail that the province’s chief inspector of mines can demand payment in full in the case of a non-renewal of letters of credit.

The company’s reclamation costs are now estimated at $100.9 million with only $14.3 million secured in cash. Schneider said that an immediate requirement to secure the remaining amount would “for sure trigger bankruptcy.”

The figure of $100.9 million is the result of a “discount rate” that estimates the present value of future liabilities based on anticipated rate of return of investments. The higher the discount rate due to perceived risk, the less that has to be set aside today.

According to Imperial Metals, the full “undiscounted” cost of its environmental liabilities is $173.6 million.

“When are the creditors going to say ‘holy cow, what are we financing?’ We’re financing the B.C. government not to have to do the clean up, so why don’t we just walk away and let the government do the clean up?’ ” Schneider said.

The company’s second quarter report for 2018 indicated that it was planning to pay for $28.4 million of the $100.9 million in future site reclamation provisions in “mineral property, plant and equipment.”

The company may be required to cover that amount in cash, which would likely require them to take on even more debt. Another $14.3 million is held as reclamation deposits, up from $4.7 million in 2016.

An estimated $86.3 million in reclamation costs are expected to be paid between 2018 and 2046, leaving about $14.7 million after 2046. Schneider said the undiscounted liabilities after 2046 may be around $100 million.

“How many equity investors care about a liability that the company has to pay in 2046?” Schneider said.

“Who really cares about it? We do. The government does. The people do. At the end of the day the equity investors don’t give a damn, and the longer you can put this stuff out the better it for the equity investors and the worse it is for the general public.”

‘The whole clean up thing is a real misnomer’

It’s unclear if that figure of $100.9 million is even enough to pay for future costs.

Imperial Metals acknowledged as much in its latest annual report: “The actual costs of reclamation set out in mine plans are estimates only and may not represent the actual amounts that will be required to complete all reclamation activity. If actual costs are significantly higher than our estimates, then our results from operations and financial position could be materially adversely affected.”

For many, the Mount Polley mine is the most immediate concern when it comes to clean up. The 2014 tailings breach released 25 billion litres of waste into nearby waterways and forests.

In 2017, Imperial Metals estimated a total of $67.4 million had been spent in clean-up costs for the Mount Polley spill. Of that, $15.5 million has been paid directly by government departments, with another $23.6 million eligible for tax refunds.

A field of debris and dried sediment at the mouth of what was Hazeltine Creek one week after the collapse of the Mount Polley tailings pond. Photo: Farhan Umedaly, Vovo Productions

The company increased its rehabilitation provision for the Mount Polley mine by $5.8 million in 2017. Schneider said that amount is the company’s best estimate of what is required to finish cleaning up Mount Polley, with $3.6 million of it being spent in 2018.

But local residents said in interviews with The Narwhal that the catastrophe is far from over.

“The whole clean up thing is a real misnomer,” said Jacinda Mack, co-founder of Stand for Water and member of the Xatśūll (Soda Creek) First Nation. “All they did was re-engineer. Everything is still in Quesnel Lake, Polley Lake, in the forest. And they say it would be more disruptive to try to remove the tailings. But if those tailings were filled with gold, they would find a way to remove those tailings.”

“Communities have received zero compensation,” Nikki Skuce, project director of Northern Confluence, said. “There’s been no fines or charges. Reclamation isn’t done. We don’t know what the long term impacts are on salmon and the water of Quesnel Lake.”

Douglas Watt, a retired metallurgist and member of the Mount Polley Mining Corporation’s public liaison committee, said it could take up to 1,000 years for the “totally devastated” Hazeltine Creek to return to what it used to be. The biggest concern for local residents, he said, is that Mount Polley received a permit in April 2017 to discharge effluent into Quesnel Lake until the end of 2022.

Watt said that immediately after the mine received the permit, the publicly announced life of the mine went up by another four years, to 2026. He said that within a few months of receiving the permit, the mine was already out of compliance with some of the permit’s conditions — and that it’s still out of compliance to this day.

“Our biggest fear is that they’re going to now ask the ministry for a permit amendment to continue to discharge their effluent beyond 2022,” said Watt, who worked for Imperial Metals in the late 1980s. “I’m pretty sure they’re probably working on that now.”

On August 15, it was announced that the B.C. Environmental Appeal Board will hear an appeal of the permit from a member of Concerned Citizens of Quesnel Lake at the end of January 2019.

Jacinda Mack in Victoria to speak with MLAs about mining reform in B.C. Photo: Taylor Roades / The Narwhal

Multiple lawsuits against Imperial Metals quashed by courts

Multiple lawsuits have been filed against the company for the spill, but all have been quashed.

Time has run out for criminal charges to be pressed in B.C. However, federal charges can still be laid sometime in the next year.

In 2017, Bev Sellars — the former chief of Xatśūll First Nation — filed a private prosecution against the company, but the B.C. Crown Prosecution Service halted the case after it concluded there wasn’t a high enough chance of conviction.

Ugo Lapointe of MiningWatch Canada also launched a federal private prosecution for alleged contravention of the Fisheries Act, but that was similarly stayed before he had the chance to present evidence in a court hearing.

“We’re concerned with not only the clean-up of the spill but the actual closure of the mine site and the clean up of the whole mine site,” Lapointe said in an interview with The Narwhal.

“You’re now dealing with a company that is not super financially viable, and it’s an increased risk for the public.”

A recent economic analysis by the Ecofiscal Commission found mines in B.C. often operate without adequate reclamation bonds and assurances, creating a major liability for the province’s taxpayers.

Majority owner of Imperial Metals donated more than $850,000 to BC Liberals

Imperial Metals’ majority owner, N. Murray Edwards, currently boasts a net worth of $2.9 billion, making him one of the wealthiest Canadians.

Companies owned by Edwards have historically been major donors to the BC Liberals, who governed the province for 16 years until one year ago.

Dermod Travis, executive director of IntegrityBC, wrote in an e-mail that total donations to the Liberals by companies owned or controlled by Murray Edwards total more than $850,000 since 2005.

That includes $199,180 from oilsands giant Canadian Natural Resources Ltd., $179,440 from Imperial Metals, $99,500 from Horizon Construction Management and $90,000 from CNR ECHO Resources.

In 2013, Edwards helped organize a million-dollar fundraiser for former premier Christy Clark’s re-election.

In 2004, an order in council forgave $2.9 million owed to the B.C. government by Huckleberry Mines, of which Imperial Metals then owned 50 per cent.

In 2017, then-interim leader of the federal Conservatives Rona Ambrose vacationed with Edwards for close to two weeks in the Caribbean.

Environmental liabilities may be underestimated

There’s also the strange situation of Imperial’s Huckleberry Mine, a copper mine that closed operations in late 2016 but may reopen in 2019 if copper prices increase.

Until April 2017, a syndicate of Japanese companies owned the other half of Huckleberry, but Imperial took it over after the syndicate couldn’t pay $77 million that it owed to the project. It was primarily because of that acquisition that the company declared a net profit in 2017. That followed consecutive years of significant losses, including losses of $96 million in 2015 and $54 million in 2016.

But Schneider said that it appears the estimated $22-million future reclamation liabilities for Huckleberry was improperly reported in the annual report, potentially requiring a reissuing of the financial documents.

The possible misreporting had to do with the “discount rate” used in reporting reclamation costs.. Schneider said Imperial Metals should have used a “risk free” discount rate of 3.2 per cent on reclamation liabilities at Huckleberry — but instead used a “credit risk adjusted interest rate” of 6.3 per cent.

That choice lowered the reported present cost of the liability. Schneider said it could end up as a difference of $20 to $30 million than if the company had used a “risk free” rate (let alone undiscounted rate).

In the end, the Huckleberry reclamation could end up costing as much as $100 million. The mine has an identified potential for acid rock drainage, which if triggered can result in significant impacts on ecosystems and wildlife.

Schneider said that Imperial Metals should potentially have to restate its financial figures, preferably providing an undiscounted amount. That would give investors and the public a far better idea of what the real costs might be.

Deloitte, which audited the company’s financial statements, refused to answer a question about the discount rate, writing: “Our policies and our code of professional conduct prohibit us from discussing any information about clients or the work that we do for them.”

The manager of investor and industry education at the British Columbia Securities Commission also said in an e-mail that “we do not comment about specific companies or market participants.”

Imperial Metals could still be rescued

It’s not known if Imperial Metals will end up declaring bankruptcy.

The creditors may renew the $200 million credit facility in October, hopeful for improved cash flows from the mining operations. Schneider said that creditors may not want to take the assets over given the company’s very high debt-to-equity ratio.

“Maybe things are in place and all will be fine — we shall see,” Schneider said.

Or Edwards or the companies he controls — which currently own 40 per cent of the company and more than $200 million of Imperial’s debt — could come to the rescue.

Lapointe of MiningWatch Canada said Imperial Metals has “pulled similar financial stunts” before, and that Edwards or affiliates will often bail companies out.

Sustained lobbying efforts could also help.

“The companies that are in bad financial situations like this for a number of years tend to lobby the government even more and try to leverage any kind of political support they can get to then get any possible subsidies or tax breaks or lower securities,” Lapointe said.

In 2016, the B.C. government introduced a deferred payment program for up to three-quarters of monthly electricity billing depending on the price of commodities.

At the end of June, Imperial Metals owed $73.5 million to the utility company. Of that, $51.4 million is to partially reimburse BC Hydro for the cost of building the controversial $736 million Northwest Transmission Line, with the remaining $22.1 million for deferred electricity costs.

But Lapointe said that if Imperial Metals does end up collapsing, another company could come along, strip it of valuable assets and leave clean-up for governments.

“Even by clearing the debt away by folding it into bankruptcy, the projects may be so marginal and high cost that the new company will be able to run the mine again for four or five years and then call it off again,” he said.

‘It’s a very tense relationship’

It didn’t have to happen like this.

Skuce said that the mining rules in Alaska and Quebec require full payment within two or three years of a mine opening, which limits public liability and dissuades high-risk projects from proceeding.

Lapointe said that Quebec’s new measures, introduced in 2013, require half of securities to be paid during the permitting process and the other half during the first two years of operation.

“Typically, the more financially risky a project or company is, the more risky it is for the environment and communities,” he said. “It’s pretty simple logic: they’re scrambling to survive. They’ll prioritize the money to survive, which is the operations and revenues. And they’ll often cut corners on everything else, including putting in place the best technologies or environmental practices or best design because they cost more money.”

Meanwhile, Mack said her community isn’t receiving regular updates from the company, and are instead instructed to check its website. But things aren’t up to date, she said, and information is often only available for a short period of time before it’s removed. As a result, she said that community meetings have dwindled from 150 people shortly after the disaster to only a handful of dedicated members.

“I would say it’s a very tense relationship,” she said. “A lot of people have stopped attending meetings out of frustration and anger.”

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By Jeremy J.Nuttall for The Tyee.

In the hours after the 2014 Mount Polley mine disaster, authorities were already concerned laws had been broken and the premier’s office was worried fallout from the tailing pond breach would “get in the way” of other planned mines, documents provided to The Tyee reveal.

Almost three years after the disaster, and weeks away from a deadline to lay charges under B.C.’s environment act, no charges have been laid and no fines levied.

The government’s initial reaction to the dam’s collapse is revealed in hundreds of pages of emails and other communications obtained through a freedom of information request and provided to The Tyee by Jessica Ross, an independent researcher and member of the BC Freedom of Information and Privacy Association.

Ross said she filed the FOI request almost three years ago and only received the documents July 4.

An email exchange between Staff Sgt. Kelly Dahl of the province’s Conservation Officer Service major investigations unit and Sgt. Richard Lebeuf of the Williams Lake RCMP documents raised concerns laws had been broken.

“From the Ministry of Environment's perspective — It appears there are several possible violations of environmental legislation that may have occurred related to this event,” Dahl wrote. He also expressed concern the federal Fisheries Act may have been broken.

Meanwhile, as officials assessed the damage done, some government staff were working to manage public reaction to the spill.

Premier Christy Clark’s then deputy chief of staff Michele Cadario raised concerns other proposed mine developments could be slowed by the disaster.

“Was there anything that could have been done that wasn’t to prevent this situation — are there better standards employed elsewhere that we should look at?” she asked in an email to a host of staffers, including communications people.

“We have a few new mines coming on stream and we don’t want anything to get in the way of that,” she wrote.

RELATED: British Columbians Saddled With $40 Million Clean-Up Bill as Imperial Metals Escapes Criminal Charges

Cadario and other government staffers raised the need to communicate with First Nations in the area and any impact on drinking water.

But they also made an effort to help mine owner Imperial Metals’ public relations efforts after the spill.

The FOI documents show government staff were concerned the company had not been heard from hours after the spill. One email from John Paul Fraser, head of government communications, said the company silence was “looking bad.”

Cadario offered a solution.

“I know the owner of Imperial Metals — I’ll text him and see if he can stir someone up,” Cadario wrote.

The company’s owner, Murray Edwards, has donated more than $400,000 to the BC Liberal Party since 2005 through Imperial Metals and his oil sands company. Edwards also hosted a private fundraiser in Alberta that raised $1 million for the party’s 2013 election campaign.

.@ChristyClarkbc Worried #MountPolley Spill Would Harm New Mine Construction, New Docs Show via @TheTyee #bcpoli https://t.co/59qXtUUvhC

— DeSmog Canada (@DeSmogCanada) July 17, 2017

After speaking to Edwards, Cadario wanted to ensure the company’s statement was being noticed by the public.

“I spoke to the owner Murray Edwards and he said an NR [new release] has gone out — Twitter traffic seems to still say that they haven’t heard from IM — Has that now been rectified?”

In another brief email Clark’s then director of communications Ben Chin said he had spoken to “Jas” about impending TV news coverage of the spill. The reference, following earlier emails on Global TV’s coverage, appears to refer to Jas Johal, then a Global reporter.

“Just finished talking to Jas… it’s just a heads up, not an interview request. He tells me the pictures at 6 will be very graphic. Imperial should get out in front,” Chin wrote.

Johal left journalism weeks later to work in communications for the BC LNG alliance. He was elected as a Liberal MLA for Richmond-Queensborough in May’s provincial election.

The dam containing the tailings pond at the Mount Polley copper and gold mine failed on Aug. 4, 2014, sending more than 25 million cubic metres of waste water into nearby Quesnel Lake and surrounding streams. The mine is about 60 kilometres northeast of Williams Lake.

Investigators concluded the failure was the result of a design flaw.

Cleaning up the disaster cost the province $40 million.

A private prosecution of Imperial Metals and the B.C. government by MiningWatch was blocked in March by the federal government, which cited ongoing investigations. 

Image: Mount Polley mine disaster. Photo: Cariboo Regional District via Youtube

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An ugly thread of misspent taxpayer dollars, environmental destruction and conflict-of-interest — backed by a government beholden to the mining industry — runs along the recently completed Northwest Transmission Line, charges acclaimed explorer and scholar Wade Davis.

The $716-million transmission line, budgeted in 2010 at $404-million, snakes 344 kilometres into B.C.’s wilderness, from north of Terrace to Bob Quinn Lake, and, to the alarm of downstream Southeast Alaska residents, the line is opening the area to mining in the headwaters of vital salmon-bearing rivers.

Those concerns have grown exponentially since the Mount Polley tailings dam collapsed in August 2014, sending 24-million cubic metres of toxic debris flowing into Hazeltine Creek and Quesnel Lake, and groups in B.C. and Alaska are warning that a Mount Polley-type disaster in the area known as the Sacred Headwaters, where acidity is likely to be high, would wipe out the multi-billion dollar fishing and tourism industries on both sides of the border.

Davis, a writer, former explorer-in-residence at the National Geographic Society, anthropology professor and B.C. Leadership Chair in Cultures and Ecosystems at Risk at the University of B.C., is appalled at the B.C. government’s decision to encourage mining in the ecologically rich northwest corner of the province and at the lack of government oversight as the pricey Northwest Transmission Line was carved through the wilderness.[view:in_this_series=block_1]

“It’s industrialization of the wilderness. It’s the story of politicians more concerned about the next election than the next generation,” he said.

Davis, who sometimes visits 30 countries a year, loves the wild beauty of B.C.’s northwest corner, which has the world’s largest population of stone sheep, grizzly bears, caribou and wolves.

“It’s not for nothing that it is called the Serengeti of Canada,” he said.

A Sweet Deal for Imperial Metals

All of which makes it inexplicable that the government would forego future high-end tourism opportunities by encouraging mining on a site such as Todagin Mountain where the Red Chris mine, owned by Imperial Metals — the same company that owns the Mount Polley mine— opened in February, he said.

An Energy and Mines Ministry spokesman, responding to questions by e-mail, said the province, Imperial Metals and Tahltan Nation — which approved a co-management agreement with the company in April — have been working to develop wildlife management strategies “to take care of this resource for future generations.”

That does not satisfy Davis, who owns the closest private property to the $650-million Red Chris copper and gold mine and believes the Liberal government has bulldozed ahead with the power line without a proper review and despite public concerns.

“The government was 100 per cent engaged in an effort to make this happen to the point of deceiving the Canadian people and certainly squandering their tax revenue,” he said, questioning the influence of party fundraisers.

Murray Edwards, controlling shareholder of Imperial Metals Corp. — a major donor to the B.C. Liberals — organized a $1-million fundraiser at the Calgary Petroleum Club for Premier Christy Clark shortly before the last election.

B.C. Government Committed to Mining Expansion

It is expected that mining companies will push for concessions, but it is also expected that the government will ask the important questions to minimize environmental damage, said Davis, who has frequently worked with industry and says he has no objection to responsible mining.

“But, here we have a government that is ideologically committed to making (Red Chris) go ahead,” said Davis, who speculates that Imperial Metals was given an easy ride to avoid the perception of a power line to nowhere.

Financial experts believe it was essential for Imperial Metals to get cash flow from Red Chris as soon as possible because Mount Polley remained closed for nearly one year and cleanup costs are estimated at between $67-million and $100-million. In May, the company reported a loss of $33.4 million during the first three months of the year.

The Northwest Transmission Line was billed by government as the engine that would drive economic development in the province’s northwest by powering up revenue-generating mining operations in the richly mineralized area.

So far, Red Chris is the only mine drawing power from the line. After a provincial review, the mine received provincial approval in June to operate the tailings storage pond, which has the same unlined earth and rock dam design as Mount Polley.

Red Chris is likely to be followed by Seabridge Gold’s Kerr-Sulpherets-Mitchell (KSM) mine, in the Unuk River headwaters, which will be one of the world’s largest open-pit copper and gold mines. KSM has received federal and provincial approval and is tying up funding for the $5.3-billion project while obtaining permits. The mine is expected to employ more than 1,000 people for 50 years.

The transmission line is also bringing power to the Tahltan community of Iskut, whose 350 residents previously relied on diesel, and to the $725-million, 195-megawatt AltaGas Forrest Kerr run-of-river independent power project.

AltaGas contributed $180-million of the cost and Imperial Metals contributed $69 million of the $209 million cost to build the Iskut extension. BC Hydro then purchased the extension for about $52 million.

Davis charges that the environmental insensitivities of Imperial Metals were revealed during the extension’s construction when the company clearcut to the edge of the scenic Stewart-Cassiar Highway, instead of leaving a buffer zone of trees as shown in the original plans.

Cutting trees adjacent to the highway is allowed and the company had all necessary permits, according to the ministry.

“As much as possible, the cutting is contained within the right-of-way of the highway to reduce impact to the visual quality of the surrounding landscape. In some instances, due to geotechnical and safety concerns (i.e. slope stability,) the power lines are located away from the highway,” said the ministry spokesman.

Taxpayers on the Hook?

The Iskut project enabled the province to obtain $130 million from the federal Green Infrastructure Fund. But, according to Davis, that is something that should make taxpayers uneasy when they look at the bill of almost $400,000 per resident and he questions labelling the project as green when, during construction, the equivalent of 14,000 logging truckloads of wood were burned.

BC Hydro has said the timber was burned because it was marginal and the long distance to roads and markets made selling it uneconomical.

 A Mining Association of B.C. study estimates the transmission line will attract $15-billion in mining investment, 10,000 jobs and $300 million in annual tax revenue.

However, energy economics expert Marvin Shaffer, adjunct professor at Simon Fraser University, would like British Columbians to look carefully at those figures, especially as the province decided to go ahead with the project without a B.C. Utilities Commission review.

“The rate policy in B.C. effectively subsidizes new mines and this was a line that was heavily subsidized,” he said.

Metal mines require large amounts of electricity. The standard industrial rate charged in B.C. is $40 to $50 per megawatt hour, but the draw on power means more power sources are needed and producing electricity from new sources, such as the Site C dam, will cost about $90 per megawatt hour, Shaffer said.

“An individual mine will consume up to 10 per cent of the output of Site C and the price doesn’t cover even half the cost of a new supply,” he said.

“The government argues that it is economic development, so then you have to ask: what are the benefits in subsidizing mining developments?”

Many of the jobs are likely to go to people living outside the province, Shaffer said.

“There might be some stimulus, but it’s not as if it’s going to be employing a lot of British Columbians who would otherwise be unemployed,” he said.

Image Credit: BC Hydro

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Imperial Metals is experiencing troubled times.

After the catastrophic breach of a toxic tailings pond at its Mount Polley mine on August 4th, British Columbians across the province have called into question the safety of the company’s other mega mine projects.

The Red Chris mine, located in B.C.’s northwestern corner is now under intense scrutiny by protestors from the Tahltan Nation who are blocking access to the company’s site, saying they won’t leave until independent reviewers address mine safety concerns.

On August 8th, the Klabona Keepers, headed by a group of mostly women elders, set up two camps, blocking each of the two access roads to the mine. Trucks are parked across the roads and makeshift wooden barricades have been erected to keep company vehicles from entering.

Located on Toddagin Mountain, near the Tahltan village of Iskut, the Red Chris mine is scheduled to begin operations later this year.

Like Mount Polley, Red Chris is an open pit copper and gold mine. And, like Mount Polley, the Red Chris mine is expected to produce millions of tons of toxic tailings over its projected 28-year life span.

The company has set aside a pristine mountain lake called Black Lake as a tailings holding pond. Black Lake is located above lakes and creeks which drain into the salmon bearing Iskut and Stikine Rivers – the lifelines of the Tahltan people.

For the elders, the current blockade is not only a show of solidarity with those affected by the Mount Polley disaster, but an act of self-defense.

One of two roadblocks blocking access to the Red Chris Mine. Photo by Albrecht Berg.

During initial consultations between Imperial Metals and the Tahltan, the company allayed environmental concerns by pointing to their safe track record at Mount Polley. The Red Chris mine would share the same design, the company said.

Now, in the wake of the Mount Polley spill, locals fear the Red Chris mine poses a similar danger to the environment, fish and wildlife.

Following the Mount Polley spill Imperial Metals’ President Brian Kynoch said, “If you asked me two weeks ago if that could happen, I would have said it couldn’t happen.”

During a visit to the Red Chris blockade, one of the elders at the camp, who, like her peers, prefers to be identified simply as Klabona Keeper, told me: “When you live off the land, when the land is your kitchen, the consequences of the kind of thing that happened at Mount Polley, are unimaginable.”

Elders sit around the fire at one of two blockades. Photo by Albrecht Berg.

The main demand of the protestors is a reliable guarantee that the kind of catastrophe seen at Mount Polley will never happen at Red Chris.

“We want an independent review of the tailings pond system by a third party independent of both the government and Imperial Metals,” the elder said.

The current standoff has brought into focus a whole range of issues around the Red Chris project. Mistrust is growing around the promised benefits of the Red Chris project.

Author and anthropologist Wade Davis, who has called the area home for the last 40 years, said the Red Chris project is a massive threat to the local landscape.

Standing in front of his home on the shores of stunning Ealue Lake, which is part of the watershed threatened by the mine, he explained that Todaggin Mountain is home to the world’s largest population of enigmatic stone sheep.

Anthropologist Wade Davis at his home on Ealue Lake. Photo by Albrecht Berg.

“This project, a hundred years hence, will be seen as one of the greatest acts of folly in history of Canadian public policy,” Davis said.

Concerns over the future of the mine have also brought new emphasis to working conditions at the mine which one Tahltan employee described as problematic.

“They can fire us without prior notice, while we have to hand a two-week notice in order to quit,” he said.

Complaints of racism against Tahltan workers have also surfaced. According to Imperial metals, 18 per cent of workers at the site are Tahltan.

“Why not 50 per cent?” one of the elders at the blockade responded when questioned on the issue.

“After all, this is Tahltan country,” she said.

Many of the locals view the Red Chris project as a showcase for how the extractive sector functions in the province.

A Red Chris Mine sign with blockaders in the background. Photo by Albrecht Berg.

B.C. subsidized the construction of a 300 kilometre-long power line to Iskut for the mine, using $750 million taxpayers dollars.

The official rationale for the North West Transmission Line was to break the reliance of 300 Iskut residents on diesel-generated power. Yet critics see the project as nothing more than a gift to Imperial Metals.

Provincial support for the Red Chris project is also seen in a new light, after significant campaign contributions for the B.C. Liberals from Imperial Metals came to light. Murray Edwards, the largest stakeholder of Imperial Metals and Calgary Flames owner, hosted a private fundraising dinner for Christy Clark’s campaign in Calgary ahead of B.C.’s May election. 

Since the events at Mount Polley, Imperial Metals and the B.C. government have engaged in significant damage control, with Minister of Mines Bill Bennett likened the spill to an avalanche.

Edwards pledged $100 million to the Mount Polley cleanup to keep a reeling Imperial Metals from going bankrupt.

Company President Brian Kynoch and Minister Bennett paid a joint visit to the Red Chris blockade on Wednesday. Both promised to halt construction until concerns were met.

But so far, the elders remain skeptical. Until they see written commitments to safety standards set by the Tahltan, they are determined to stay.

The mood at the camp is cheerful, yet forceful. Campfire conversation drifts from hunting stories and cookie recipes to political tactic.

One elder joked, “We can always go Mohawk style.” The others chuckled, but agreed they prefer to avoid unnecessary escalation.

The Tahltan have a long history of blockading.

In 2005, during a standoff between Fortune Minerals and Tahltan elders over a proposed open pit coalmine, 15 Klabona Keepers were arrested for defying an injunction to clear the very same access road now blocked by many of the same veteran blockaders.

While the battle over Fortune’s coalmine continues, the Klabona Keepers succeeded in stopping Royal Dutch Shell from going ahead with plans to extract coalbed methane in the same region. Shell withdrew from the region in 2012.

When asked how long they were willing to keep up the current blockade, all the elders answered simply, “For as long as it takes.”

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