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Let's make a deal
Metis Nation and Avalon Rare Metals sign agreement on Nechalacho project

Paul Bickford
Northern News Services
Published Saturday, February 22, 2014

Avalon Rare Metals Inc. and the Northwest Territory Metis Nation (NWTMN) have signed a participation agreement for the Nechalacho rare earth elements project at Thor Lake, about 100 km southeast of Yellowknife on the north side of Great Slave Lake.

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The Northwest Territory Metis Nation has signed a participation agreement with Avalon Rare Metals, which is developing the Nechalacho rare earth elements project at Thor Lake, about 100 km southeast of Yellowknife. - photo courtesy of Avalon Rare Metals Inc.

The agreement, which was signed Feb. 14 by fax, will provide training, employment , business opportunities and a very small financial stake in the company for the NWTMN. It will also mitigate potential environmental and cultural impacts.

Garry Bailey, president of the NWTMN, said the agreement is a major step forward.

"It's the first impact benefit plan that the Metis have actually received from a developer, so I think it's very important," he said. "The very first one of more to come, as far as I'm concerned."

Bailey thinks the agreement will mean opportunities for economic development, jobs and training for members of the NWTMN, which represents Metis councils in Fort Resolution, Hay River and Fort Smith.

In a news release from Avalon Rare Metals announcing the agreement, Bailey praised the company.

ďFor the Northwest Territory Metis Nation, the Twentieth Century was marred by the merciless exploitation of resources from our territory with no consultation with us, resulting in no benefit to our people," he stated. "Itís an amazing feeling and a wonderful pleasure to be in business with a farsighted, Twenty First century company like Avalon who recognizes our government, our people as a nation, our friendship as valuable and our partnership as essential.Ē

Don Bubar, Avalonís president and CEO, welcomed NWTMN's participation in the Nechalacho project.

"We committed to entering into such arrangements with all of our aboriginal partners in the North and the Northwest Territory Metis Nation was one of those groups," he said. "We started negotiating with them last summer and we're pleased to be able to conclude this agreement over a relatively short time."

Avalon also has a participation agreement with Deninu Ku'e First Nation in Fort Resolution, while another with Lutsel K'e Dene First Nation is awaiting community ratification, plus the company is negotiating with other aboriginal organizations.

The new participation agreement includes an implementation committee, job training and scholarships, co-ordination on employment opportunities, participation in environmental monitoring, protection of traditional knowledge and culture, annual implementation capacity payments when construction commences, and more.

"One of the main attractions of the Northwest Territory Metis Nation is its members include quite a few entrepreneurs and businesspeople who potentially have businesses that could provide services to the operation going forward," said Bubar, adding the company will also seek workers for the project.

A formal signing ceremony is planned for March 3 in Toronto at the annual convention of the Prospectors and Developers Association of Canada.

Bubar said that is an opportunity to sign the agreement in front of a large audience of industry colleagues.

"It's a good example for the entire industry of the types of agreements that are being entered into now between mineral exploration and development companies and aboriginal groups, and sets a positive precedent I think for the rest of the industry going forward," he said.

Bailey will be going to Toronto for the signing.

"It's a good way for the Metis Nation to get out there with all the exploration companies that are coming north and let them know who we are and what's happening in the territories," he said.

The Nechalacho rare earth elements project received environmental approval from the federal government in November. The company now needs to raise $1.5 billion to begin operations.

Bubar said no final decision has been made whether a hydrometallurgical plant will be built at Pine Point.

"We have been working on an alternative hydrometallurgical process that would not be well suited to locate in the North just because it involves a whole range of different chemical solvents and reagents that are just not in the region and can't be made easily in the region that would likely result in that plant being located elsewhere," he said.

Even if the plant is not built in the South Slave, Bubar said there would still be business opportunities in the region.

"We would be moving concentrate out from the project through Hay River by rail to wherever it goes after that for further processing for sale. So there would be a trans-load facility needed there," he said, noting the concentrate would be barged to Hay River.

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