by Doug Ashbury
Northern News Services

NNSL (Dec 01/97) - If Canadian 88 Energy Corp. president Greg Noval was considered something of a renegade before last Thursday, news that the Calgary company will share petroleum profits with an aboriginal organization should solidify his reputation in the industry.

Oil companies aren't known for signing such deals. At least not until now.

Under a landmark access agreement, Tulita Dene and Metis of Fort Norman will get five per cent of the net profit Canadian 88 earns from petroleum produced from its 86,156-hectare zone in the Sahtu. A benefits plan has also been signed.

The access agreement is a private contract, while the benefits plan needs approval from Indian and Northern Affairs Minister Jane Stewart.

Under the Sahtu master land agreement, a portion of Tulita's benefits will be shared among the two other districts. Tulita is one of three districts in the Sahtu region.

"If Inco in Voisey's Bay had done this, they wouldn't be in the position they're in," Noval said.

The huge nickel deposit in Labrador has so far produced only a protracted legal battle between the company and local Inuit.

Tulita Dene Nation Chief Gordon Yakeleya said the agreement is a historic one between a resource company and an aboriginal people. He called Noval's approach to the negotiations visionary.

At the least, the agreement sets a precedent other oil companies could be forced to follow. It also may impede Ottawa's ability to negotiate higher royalties with aboriginal groups.

"We're proud of the deal. We'll take flack from other (oil companies). We have already," he said. "Whether we find oil or gas or not, it sets a precedent."

The deal was negotiated "independent of the federal government," Noval said.

Davis and Company lawyer Richard Hardy, who led negotiations between the two sides, said that, before the money starts flowing, a viable amount of oil will have to be found.

Assuming current economic conditions prevail, Hardy projects that a 45 million barrel oil find located 20 kilometres from the Norman Wells Zana Lake pipeline, with prices at $21 US a barrel, would generate $21 million over a 34-year period for Dene -- more than 20 times what the access fees alone would generate.

Canadian 88, after all costs, would clear $401 million over that same 34 years.

Hardy called the agreement the most significant he has ever been associated with. "Without Greg Noval, this wouldn't have happened," he said.

The signing of the benefits plan and the access agreement comes four years after the Sahtu land claim agreement.

The claim, signed in September 1993, was brought into force in June 1994. The Tulita-Canadian 88 agreements took effect Oct. 31.