Arthur Pape, legal counsel for the Dogrib, said the compensation being paid to the Department of Fisheries and Oceans by BHP may not be enough to make up for the "no net loss" policy used by the DFO.
"It may take three, four, five, even $10 million to introduce the no net loss policy," he said at NWT Water Board hearings earlier this week.
The fisheries department said BHP will pay $1.5 million for lake habitat that may be destroyed and that money will be used for habitat restoration and enhancement projects off-site.
The company will also pay the government an additional $1 million and $100,000 annually from 1997 to 2001.
The department will establish a compensation advisory committee to oversee how the money will be spent.
Under fisheries guidelines, the department has no net loss of the productive capacity of fish habitat as a guiding principal.
For the BHP project at Lac de Gras, 300 kilometres northeast of Yellowknife, 12 lakes will be affected and half will be drained.
If the department determines the same level of productive capacity cannot be maintained, then it has the option of replacing natural habitat at or near the site.
Dogrib, Yellowknives Dene, Lutselk'e First Nation and Kitikmeot Inuit representatives said they have used the lakes in the area of the proposed project for generations.
They want guarantees fish habitat will be protected if the project proceeds.
The hearings were a part of BHP's application for a water licence.
The water board should have a decision forwarded to Ottawa on the application by mid-November, said chairman Gordon Wray. Northern Affairs Minister Ron Irwin can accept or reject the board's recommendations.