Sahtu Project

Towards a Sahtu Development Corporation:

A Discussion Paper

Prepared for the Tulita Dene Band Chief Frank Andrew

By Garth Wallbridge

March 27, 2011

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TABLE OF CONTENTS
Page Chapter 1 Chapter 2 Introduction and Executive Summary Financial and Other Findings from Regional Development Corporations Major Findings Financial Achievements of Regional Development Corporations Financial Growth of Selected Regional Development Corporations Gwichin Development Corporation Nunasi Corporation Makivik Corporation Inuvialuit Development Corporation Inuvialuit Corporate Group Financial Performance 2005-2009 Inuvialuit Subsidiaries Financial Performance 2005-2009 Recent Regional Development Corporation Holdings Social Benefits Native Economic Development: Lessons from Elsewhere The Harvard Project on American Indian Economic Development The Context for Maori Economic Development A Model of Regional Economic Development A Model Economic Development Corporation Towards A Sahtu Development Corporation Assets and Achievements Governance and Operational Institutions Business Ventures Potential Regional Economic Opportunities Next Steps Conclusions 4 8 8 10 11 11 12 13 13 14 16 16 18 19 19 20 22 22 25 26 26 26 26 28 29

TABLE 1

TABLE 2 TABLE 3

Chapter 3

Chapter 4 FIGURE 1 Chapter 5

APPENDIX

Development Corporations in Northern Canada and Alaska Inuvialuit Regional Corporation Inuvialuit Development Corporation Inuvialuit Development Corporation Main Holdings Inuvialuit Investment Corporation Inuvialuit Petroleum Corporation Inuvialuit Land Corporation Inuvialuit Corporate Group Financial Performance 2005-2009 Inuvialuit Corporate Group Financial Performance 2005-2009 Inuvialuit Subsidiaries Financial Performance 2005-2009 Spinoff Benefits
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32 32 33 34 35 36 36 36 37 38 39

FIGURE A-1

TABLE A-1 TABLE A-2

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FIGURE A-2

FIGURE A-3

FIGURE A-4 FIGURE A-5

FIGURE A-6

FIGURE A-7

FIGURE A-8

FIGURE A-9

FIGURE A-10

FIGURE A-11

Gwichin Region Gwichin Development Corporation Gwichin Development Corporation Main Holdings Gwichin Settlement Corporation Gwichin Business Development Department Spinoff Benefits Tlicho Region Tlicho Investment Corporation Tlicho Investment Corporation Main Holdings Denendeh Development Corporation Denendeh Investments Inc. Denendeh Investments Incorporated Portfolio Dehcho Economic Corporation Dehcho Economic Corporation Main Holdings Akaitcho Regional Investment Corporation Akaitcho Energy Corporation NWT Metis Development Corporation North Slave Metis Alliance Metcor Inc.s Main Holdings Sahtu Region Economic Development in the Sahtu Settlement Area Sahtu Region Main Holdings by Community Nunasi Corporation Structure and Holdings Nunasi Corporation Main Holdings Spinoff Benefits James Bay and Northern Quebec Agreement (1975/1978) Makivik Corporation Makivik Corporation Main Holdings James Bay Crees Yukon Umbrella Final Agreement Labrador Inuit Land Claims Agreement Labrador Inuit Development Corporation Labrador Inuit Development Corporation Main Holdings Nunavik Inuit Land Claims Agreement (2006) Innu Nation Osoyoos Indian Band Development Corporation Osoyoos Indian Band Development Corporation Main Holdings Alaska Native Claims Settlement Act Arctic Slope Regional Corporation

40 41 42 43 43 44 47 47 47 48 49 50 51 52 53 53 54 54 55 56 57 58 58 61 62 65 67 68 69 70 72 74 74 76 77 78 78 80 81 82

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CHAPTER 1. Introduction and Executive Summary The focus of this discussion paper is on regional economic development in northern Canada, mainly in regions with settled land claims. The paper examines the role being played by economic development corporations in building regional economies and strengthening the social well-being of land claims beneficiaries. The efforts being made in regions without settled land claims are also part of the survey. The main focus is on the regional development corporations in the Northwest Territories. The Inuvialuit, Gwichin, Tlicho, and Sahtu regions (all with settled claims) are examined, as are efforts in Nunavut, Northern Quebec, Yukon, Labrador, and Alaska. The work of the Osoyoos Indian Band in British Columbia, recognized internationally for its excellence, completes the descriptive portion of the paper. The land claim final agreements contain many common features, but within those common features each region has created an economic development model with distinctive elements that other regions could learn from and possibly use to their own advantage. The reader is encouraged to look for these features in the descriptions of each economic development corporation in the Appendix. Chapter 2 presents a summary of the findings. For comparative purposes, the paper examines research into native economic development from the United States and New Zealand. The research findings, presented in Chapter 3, identify the underlying, foundational requirements for successful native economic development. This analysis helps us to understand why some regions are more successful than others in building businesses, employment opportunities, and wealth for their people. Research by the Harvard Project of Harvard University identifies three main elements for successful native economic development: sovereignty, institutions, and culture. They later added an additional two elements: leadership and strategic thinking. The land claim final agreements in northern Canada meet the first three conditions. Comprehensive claims recognize the sovereignty of the claimant groups, and create the basisand the funding on which to build social and economic institutions that respect the cultural values of the claimant group. Where leadership and strategic thinking are also present, success is more likely to happen and to grow over time. Spinoff benefits are also likely to increase. The New Zealand Treasury Department, in a recent discussion paper prepared at the request of the Maori for a national assembly, found that an agenda for Maori economic
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development should focus on three factors: developing people, developing enterprises, and developing assets. Above all, the paper argues that the single most important factor in determining the success of Maori economic development over the next 20 years will be initiatives that improve the education and skills of Maori peoplesound basic education of youth leading to skill training, employment and higher incomes, and opportunities for people to learn on the job as workers, business operators, managers, or administrators. Enterprise development and asset development flow from this skill development. Both the Harvard Project and the New Zealand Treasury stress the importance of separating the institutions of economic development (and the funding they require to build enterprises and capital assets), from the political functions of aboriginal governments. Starting from these basic factors and the strong features of the northern economic development corporations, it is possible to propose a best practices model for a regional aboriginal economic development corporation. Chapter 4 does that. Some of the main features of this model economic development corporation include the following: Governance institutions that include sole ownership of the economic development corporation by the regional authority, that operate fairly and impartially, and that keep all business and investment activities separate from the political activities of the regional authority; Goals and objectives that include support for the traditional economy as well as business development; A business development strategy that includes essential local services, participation in regional industrial projects, and, resources permitting, investments in national and even international enterprises with joint venture partners; A strong emphasis on education, training and skill development, and opportunities for beneficiaries to learn on the job through employment in the Settlement Area; Close monitoring of investments and flexibility in responding to opportunities and challenges in the economic environment; Non-competitive alliances and multiple partnership arrangements with other aboriginal partners to provide essential services across regions; Scope of activity that includes professional support for small and isolated communities, and investment in community-based projects; and
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Relations with government that ensure a financial stake in government projects on Settlement Area lands and participation with government and industry in planning forums and major developments.

The final chapter looks at the assets and achievements of the Sahtu region to date and makes a brief environmental scan of the potential economic opportunities in the region that would make it advantageous for the Sahtu Dene and Metis to have a regional development corporation. A brief environmental scan is enough to indicate that the Sahtu region, and each of the Sahtu communities, is situated in an area of high non-renewable resource potential for large-scale industrial development (and potential local spinoff projects). A decision on the Mackenzie Gas Pipeline Project is expected by 2016. A decision to build the pipeline would surely spur continued exploration work in the region, for which some beneficiaries already have training. It would also provide contracting opportunities for Sahtu-owned businesses supplying helicopter, heavy equipment, expediting and camp services, and opportunities for ongoing maintenance contracts. Construction of the pipeline would almost certainly be accompanied by government action to extend the Mackenzie Valley Highway, creating similar opportunities. Mining activity in the region is also promising and likely to continue, and steps to develop hydroelectric power schemes and/or technologically sophisticated alternative energy projects are already being taken. With five areas of ecologically and culturally important land being actively reviewed for designation as Historic Sites, and a sixth one having been proposed, every community in the region has potential opportunities for eco-tourism and heritage development, land and resource management, and scientific research potential to take advantage of. The evidence presented in this discussion paper suggests that one institution that would put the region in a stronger position to take advantage of these opportunities is missing. A regional development corporation would allow the communities to pool existing financial resources and managerial capacity and, if need be, to hire external expertise to undertake region-wide projects and support future community-based ventures. A Sahtu Development Corporation would be able to engage industry in negotiations involving major projects within the Settlement Area, speaking with one voice for the entire region. It would be able to do the same with the federal and territorial governments.
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When all of the existing assets and achievements to date, and the potential opportunities for the future are taken into consideration, it is reasonable to conclude that one remaining institutional piece should be put in place to strengthen the Sahtus capacity for economic developmenta Sahtu Development Corporation. It is anticipated that the communitybased economic development corporations within the Sahtu will both be able to realize a large volume of work, revenue and profits from their involvement in a region-wide corporation, while continuing to have control of the local work they now have on the go. One of the lessons to be taken from this survey paper is that a critical mass of financial and human resources makes a difference. A regional body operating with a larger pool of capital, managed by experienced professionals, has more resources for responding to regional and community needs and opportunities over smaller, local enterprises operating alone. A regional economic development corporation is also more likely to have influence with government and industry than individual communities. Another lesson learned is that the benefits of regional development build up over time, creating wealth that gives a region the flexibility to take advantage of new opportunities, and the resourcefulness to deal with setbacks. That has been the experience for the Inuvialuit, for Nunasi Corporation, the Makivik Corporation and the Alaska North Slope, and for other regions with more recent settled land claims. Whatever problems might arise in the short term, from the longer term the Sahtu could look back and see how far it has come.

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CHAPTER 2. Financial and Other Findings from Regional Development Corporations This chapter summarizes the findings from the review of the regional development corporations found in the appendix to this report. Readers interested in the background information on which these findings are based, or have an interest in one or more of the regions surveyed, can go to the appendix. The activities of ten regions with settled land claims in Canada and Alaska are summarized there, plus the NKMip Band in Osoyoos, British Columbia, as well as efforts by the Dene and Metis of the NWT in regions without settled claims, and by the Innu of Labrador. Sahtu has most of the institutional features found in other regionsa settled claim, compensation funding and Trust Fund, regional and local councils, and local development corporations. The one piece that is missing is a regional economic development corporation. The question to address then becomes, what have other regions accomplished through their development corporations that might be beneficial for the Sahtu? Major Findings 1. Broadly speaking, all of the settled land claims have the same goals and objectivesto develop their economies, improve the social wellbeing of their people, and protect their land. This is true for Canada and Alaska, and elsewhere in the United States and New Zealand, reviewed in Chapter 3. 2. Employment and business revenues (wealth generation) are the keys to achieving economic and social goals and objectives. 3. Human capacity buildingpreparing land claim beneficiaries for jobs at all levels in an organization as workers, managers, and business owners, beginning with basic educationis key to economic success. Learning on the job occurs at all levels in the workplace and is arguably just as important to success as education and training. (See more on the role of education, training and workplace learning in Chapter 3). 4. A critical mass of financial and human resources makes a difference. A regional approach to economic development allows financial and human resources to be pooled to develop regional initiatives and support community-based activities. The Inuvialuit Development Corporation is a good example of this.
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5. The joint venture partnerships that regional development corporations enter into, often with large and experienced industrial corporations, are not just a means to participate in profitable business operations; they are also an important means of achieving knowledge transfer to beneficiaries. The Gwichin Development Corporation describes its approach this way: We look for partnerships that promise to deliver profits for both partners, training for our people and sustainable development for our land. 6. Every region that was surveyed has major industrial activity occurring within the region or potentially occurring in the near future, and most of the regions surveyed are participating in these major projects, as well as providing essential services through local and regional business ventures. 7. Connections with industry matter. As one example, the Labrador Inuit of Nunatsiavut own the company that manages the mining and camp services at the Voiseys Bay nickel mine. Their example demonstrates the potential for land claims beneficiaries to become significant participants in an industrial megaproject through their development corporation. 8. Preservation of the value of the heritage fund against inflation is the minimum, essential objective; growth of the heritage fund to meet the social needs of a growing population and to generate wealth for future projects is the goal of investment management. (See Table 1 below.) 9. Professional management of land claims capital transfers must be in place to ensure that investment portfolios accumulate wealth over time. Sound practice involves: Close monitoring of investments with frequent review and reporting against an investment earnings target; Delegation to more than one professional investment advisor; Simple, understandable annual reports to beneficiaries, laid out in a consistent format that shows year-to-year trends (something the Inuvialuit do very well).

10. Regions often struggle at first with their business ventures before they become stable and consistently profitable. The James Bay Crees of Northern Quebec, and the Inupiat of the Alaska North Slope, are both candid about their business growing pains.
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11. Separation of business activities managed by a development corporation from the political and related responsibilities of the land claim organization is an important principle. The Gwichin and the Osoyoos Band are very clear about this. 12. There are no limits to the types of ventures a regional development corporation can enter into, from local essential services (e.g., groceries, fuel distribution or hotels), to regional and national services and industrial ventures (e.g., regional and mainline air carriers, mining and manufacturing), to public utilities and sophisticated technologies (e.g., the Tlichos $30M investment in a hydro-electric dam, digital networks and telecommunications systems), and specialized ventures (e.g., pharmaceuticals research by Makivik Corporation, venture capital management by the Inupiat of the Alaska North Slope). 13. Being small does not prevent success. The NKMip Band of Osoyoos, BC fully exploits the potential of its small land base and is recognized internationally as a model for native economic development. The Innu Nation of Labrador, without a land claim and representing just 2,200 people in two communities, has been successful in winning financial and other concessions from industry and government. 14. Clear development goals make a difference. The Arctic Slope Regional Corporation, whose lands are rich in natural resources, puts it this way: ASRC is committed to developing these resources and bringing them to market, in a manner that respects Inupiat subsistence values while ensuring proper care of the environment, habitat and wildlife. 15. Time matters. The benefits of regional development build up over time, creating wealth that gives a region the flexibility to take advantage of new opportunities, and the resourcefulness to deal with setbacks and economic downturns. Financial Achievements of Regional Development Corporations The data available for the Inuvialuit and Gwichin, the James Bay Inuit and Nunasi Corporation make it possible to see how business operations conducted over time can result in substantial net financial growthwealth generation to support the future aspirations of beneficiaries.
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The data from Table 1 demonstrate how the four regions for which financial information is readily available have been successful in generating, and maintaining, substantial wealth for their beneficiaries, in spite of setbacks caused by the recession of 2007-2009. TABLE 1 Financial Growth of Selected Regional Development Corporations
Region Inuvialuit Gwichin Nunasi* Makivik** Year 1984 1992 1976 1993 1975 Amount Compensation $169,500,000 $141,000,000 $1.173 billion $90,000,000 Received Over 14 years 15 years 14 years 25 years Beneficiaries (Approximate) 4,000 2,400 25,000 10,000+ Inuit Communities 6 4 26 Recent Net Worth $362,500,000 (2009) $115,300,000 (2010) $1.115 billion (2009) $180,000,000+

14 Inuit (Nunavik) * Nunasi was founded in 1976 on borrowed money, all of which was repaid by 1992. The Nunavut land claim was settled in 1993. ** The James Bay Agreement of 1975 was for a total of $225 million paid over 25 years to 16,000 Crees and more than 10,000 Inuit. The Naskapi of northeast Quebec joined through the Northeast Quebec Agreement in 1978. The Makivik Corporations portion of the compensation package came to $90 million.

Gwichin Development Corporation The Gwichin Final Agreement illustrates the point. It provided tax-free capital transfers in annual installments totaling $141 million over 15 years, less repayment of the negotiation loans of $8.1 million. The final payment in 2007 resulted in a net balance in the Gwichin Settlement Fund, called Gwichin Legacy Capital, of $134.7 million. This amount exceeded the original fund objective of $132 million. Due to the global recession, Gwichin Development Corporation assets decreased from $49.8 million in 2008 to $36.5 million in 2009. Shareholder equity dipped slightly over the same period from $2.2 million to $2.1 million, and revenues decreased from $6.6 million in 2008 to $5.9 million in 2009. A small loss in 2009 followed a larger one of more than $6 million in 2008. Given the uncertain economic environment and delays in the Mackenzie Gas Project, the GDC is looking for investment opportunities outside the Gwichin Settlement Area. The 2006-2007 Annual Report of the Gwichin Settlement Corporation describes how the GSC has actively revised the management of federal capital transfers over the years, especially since 1996, to maximize return on investment. Steps taken include the
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establishment of an Investment Committee, the retention of an external investment advisor, the establishment of an investment policy that governs how the fund is invested and managed, and periodic review of the investment mix by the Investment Committee, resulting in changes. The 2009-2010 Annual Report of the GSC notes that since 1996, when the fund was first actively managed, the fund has returned approximately 6.4% annually, 0.2% ahead of the policy benchmark. However, the fund slightly underperformed its benchmarks for the four-year period ending in 2010. With losses due to the recession, the Gwichin Legacy Capital stood at $115.3 million in 2010, representing a shortfall from the inflation-adjusted level of $139.5 million. Nunasi Corporation Nunasi Corporation, established in 1976, pre-dates the settlement of the Nunavut Land Claims Agreement in 1993.1 Nunasis purpose was to support Inuit to take a prominent place in the world of Canadian business. Originally, Nunasi Corporation was financed through debt financing secured through the proposed land claim. The loan was fully repaid in 1992, a year before the land claim was settled. Payment of the Capital Transfer from the Government of Canada to the Nunavut Trust was made in 14 annual payments for a total of $1.173 billion, less repayment of negotiation loans of $39.7 million by TFN. The final payment was made in 2007. In fiscal year 2009, the Inuit Trust reported investment income of $38.8 million and a distribution to beneficiaries of $33.6 million on investment assets totaling $1.115 billion. The Inuit Trust also declared dividends of approximately $463,000. By that same year, Nunasi Corporation had declared dividends since 1999 of over $3 million. Over the course of its growth, Nunasi has entered into numerous joint ventures with other Aboriginal development corporations across northern Canada which have regional importance or national scope. The investment arms of these regional bodies, including the three Regional Inuit Associations of Nunavut, often have extensive investments of their own. The result is a complex web of holdings and relationships. Nunasis flagship
1

Back in 1976, the Inuit Tapiriit of Canada, now known as the Inuit Tapiriit Kanatami or ITK, created the

Inuit Development Corporation as the development arm of the yet to be formed territory of Nunavut. ITK also formed an organization called the Tunngavik Federation of Nunavut (TFN) to negotiate the land claim agreement. Shortly after that, TFN renamed the Inuit Development Corporation Nunasi Corporation. Page 12 of 83

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partnership is the equal partnership with the Inuvialuit in the NorTerra Group of companies. Nunasi also partners with the Gwichin Development Corporation, the Denendeh Development Corporation, the Yukon Indian Development Corporation, Makivik Corporation, Sakku Investment Corporation in the Kivalliq Region, and the Labrador Inuit Development Corporation. By recent count, Nunasis wholly owned subsidiaries included seven companies operating retail, helicopter, education and training, and security and courier services. Its joint ventures involve companies and groups of companies, some of which operate their own subsidiaries44 companies in allfor a grand total of 53 subsidiaries on the Nunasi organization chart. Makivik Corporation Makivik Corporation is a non-profit entity. It receives, administers, distributes and invests the compensation money payable to Nunavik Inuit. The initial $90 million paid out under the compensation package more than doubled over 30 years. Makivik is also now receiving the $86 million capital transfers and associated funds due under the Nunavik Inuit Land Claim Agreement (2007) to create the new Nunavik public government, while $55 million will fund the Nunavik Inuit Trust to make disbursements to individual Nunavik Inuit. An internal Investment Review Committee (IRC) is responsible for ensuring that Makiviks capital fund grows over time for use by future generations. The IRC is an advisory group to the Makivik executive which administers and invests the capital fund in stocks, bonds and money markets; reviews joint venture projects or proposals including the creation of new subsidiary companies and loan request applications; and recommends the annual budget to the Makivik directors based on the projected rate of return from financial investments. The IRC meets monthly while an investment group monitors the fund and tracks investment activities daily. Inuvialuit Development Corporation The year 2009 was the twenty-fifth anniversary of the Inuvialuit Final Agreement. Since 1984 the Inuvialuit: Have successfully built up the real value of their heritage fund; Earn large after-tax profits most years; In spite of a substantial loss in 2009 due to the global recession, continue to enjoy substantial wealth as a collective body;
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Provide significant levels of employment for beneficiaries and a major wage package in the region; Fund the operations of the six community corporations; Fund social programs of value to beneficiaries and make charitable donations from the revenues earned by development corporation businesses; Provide spinoff benefits such as community cleanups, cultural and youth projects and community events; Earn the trust of government departments and agencies, which become more willing to entrust program funding to the IRC. Operational success earns trust and creates the conditions needed for continuing success.

Table 2 summarizes the overall financial operations of the Inuvialuit subsidiaries in the Inuvialuit Corporate Group over the most recent five-year period. The table shows that the Inuvialuit were generating substantial after-tax earnings up until 2008, when the global recession took hold. In spite of the reduced earnings in 2008 and the loss incurred in 2009, the minimum cash payout to beneficiaries of $400 each was maintained for those years, and was much higher in previous years. (In fiscal year 2000, after-tax earnings reached $52,500,000 and the individual payout to beneficiaries was $850 each.) The individual payouts to beneficiaries give every Inuvialuit an incentive to take a serious interest in IRCs activities in the regional, national, and international economy. TABLE 2 Inuvialuit Corporate Group Financial Performance 2005-2009
Year After Tax Earnings (Losses) ($17,346,000) 3,824,000 35,179,000 36,459,000 19,545,000 Beneficiary Distribution Total Individual Beneficiaries 3,989 3,912 3,812 3,726 3,650

2009 2008 2007 2006 2005

$1,595,600 $400.00 1,565,000 400.00 3,816,155 1,001.09 2,869,470 770.12 1,744,651 477.99 Direct Benefits to Beneficiaries From ICG Resources $17,879,299 21,102,222 20,285,992 17,345,371 18,151,624 Equity in ICG $362,584,000 381,841,000 382,216,000 350,234,000 315,825,000

2009 2008 2007 2006 2005

Employee Wages $12,629,242 13,786,608 13,467,600 11,470,148 11,411,625

Contribution Agreements $11,000,000+ 11,600,000 8,600,000 8,700,000 6,000,000

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Direct benefits to beneficiaries have been in the range $17-21 million over the five-year period. Employee wages ranged from $11 million to nearly $14 million annually of that amount. The remainder was expended on a variety of community projects, support for education and elders, and donations of various kinds within the region. Total equity in the Inuvialuit Corporate Group declined somewhat in 2009 from a high in 2007, but remains more than double the original land claims settlement at $362.5 million. Besides its direct business and investment activities, IRCs organizational and managerial strengths make it an attractive partner for the federal and territorial governments. Both levels of government have raised the amounts in their contribution agreements recently to support wellness and social development programs and capacity-building efforts in the ISR. Table 3 breaks down the results for the three profit-earning members of the Inuvialuit Corporate Group for the years 2005-2009. The Inuvialuit Land Corporation seldom reports earnings. The table records the impact of the 2007-2009 recession on the revenues, profits, wages and employment numbers, and donations made by the Inuvialuit Development Corporation (IDC). IDC had revenues of $221 million in 2009, the worst year of the global recession, when it recorded an after-tax loss of nearly $15 million. That represented a major decline from 2006, when IDC turned a profit of more than $19 million. In spite of the recession, wages paid to beneficiaries remained at nearly $8.7 million in 2009, paid out to 290 beneficiaries, and donations exceeded $700,000. The Heritage Fund managed by the Inuvialuit Investment Corporation, the returns from which fund the administration of the Inuvialuit Regional Corporation and the community corporations and other expenses, recorded a decline in earnings to $1.9 million in 2008 and a loss of $6.4 million in 2009, well down from the typical earnings of previous years in the $8-$10 million range. Benchmarks for earnings set on a four-year evaluation period were also brought down sharply for 2008 and 2009. Close monitoring of investments, however, has kept the rates of return close to, or above, the targets. The slowdown in oil and gas exploration prompted the Inuvialuit Petroleum Corporation to sell off southern business interests several years ago and invest the proceeds through IIC
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pending better opportunities. Portfolio earnings for the Inuvialuit Petroleum Corporation are not reported separately from the IIC returns. TABLE 3 Inuvialuit Subsidiaries Financial Performance 2005-2009 Year
Revenue 2009 2008 2007 $221,146,000 309,396,000 268,984,000

Inuvialuit Development Corporation

After Tax Profit (Loss) ($14,995,000) 2,713,000 13,115,000 Wages Paid to Beneficiaries $8,690,502 10,020,000 9,970,000 Beneficiaries on Payroll 290 391 430 Donations $732,000 467,000 1,114,000

2006 2005

229,314,000 187,605,000

19,403,000 8,346,000

8,400,000 Not reported

Not reported 200 full-time equivalent positions

1,400,000 1,600,000

Inuvialuit Investment Corporation Heritage Fund

Net Market Value 2009 2008 2007 2006 2005 $181,926,000 146,932,000 197,860,000 195,000,000 176,300,000 Profit (Loss) ($6,380,000) 1,904,000 9,275,000 10,505,000 7,969,000
Return (4-yr avg)

Inuvialuit Petroleum Corporation

Portfolio IIC/Ikhil* Earnings down Earnings down Not reported Not reported Not reported Earnings $89,000 1,387,000 2,975,000 2,975,000 Not reported

Target 3.1% 1.2% 10.6% 12.4% 11.3%

3.0% 0.8% 10.3% 14.1% 10.8%

* Following the sale of IPCs southern business interests, the proceeds were invested in IIC. IPC also owns a one-third share in the Ikhil Natural Gas Project which supplies Inuvik.

Recent Regional Development Corporation Holdings A scan of the Appendix will demonstrate the unlimited range of business ventures the regional development corporations own outright or have majority, equal, or minority shareholdings in. Major sectors of the economy in which development corporations have holdings include: civil and industrial construction; energy development (oil and gas, hydro development and transmission); hospitality and tourism (hotels, motels, lodges, travel
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agencies); real estate and property management (residential, offices, commercial, industrial); retail (groceries, fuel, hardware); transportation (regional and mainline air carriers, inland and marine barging and shipping, trucking). A range of businesses support the mining and oil and gas sectors: engineering and environmental services; logistical and expediting services (road and air freight handling); helicopter charters; remote camp services; winter road construction; labour supply; heavy equipment; welding and equipment repair; specialized concrete for underground operations (North Slave Metis); and others. The Labrador Inuit of Nunatsiavut illustrate the extent to which a development corporation can be active in a major mining project. Through its subsidiary Torngait Services Inc., the Labrador Inuit Development Corporation is a major player in the development and operation of the Voiseys Bay nickel mine. Torngait Services, in partnership with ATCO Frontec, built, operates and supervises the Voiseys Bay camp, is responsible for on-site engineering and equipment operation, drilling and mine mill operations, employee supervision and general labour supply. A recent fiveyear contract valued at $47.5 million provided employment for 65 employees, of whom 70% are aboriginal. The Tlicho entered into a joint venture with ATCO Frontec in 1999 to supply goods and services to the diamond mining industry outside Yellowknife. After only six years the Tlicho bought out ATCO Frontec. At the time they had 300 employees and $55M in revenues according to newspaper reports. Many specialized sectors of the economy are obvious choices, or present specific opportunities in various regions: forestry in northern Quebec and Labrador, shrimp and turbot fishery in Nunavik and Labrador, hydro generation for the James Bay Crees and Tlicho, power transmission for the Akaitcho and Metis, fire management in the Tlicho and Sahtu, sealift operations, fur tanning, adventure tourism cruises, quarrying, commercial agriculture (vineyards and winery as part of a multi-faceted resort and recreational development at Osoyoos); petroleum refining and distribution (Alaska North Slope). Some business ventures are meant to enhance the quality of life for beneficiaries: medical boarding homes in several locations; a pharmacy in Cambridge Bay serving the community and Kitikmeot region and another pharmacy in Rankin Inlet serving the Kivalliq region; education and training services in several regions (classroom or workplace based); preschool and daycare (Osoyoos).
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Sophisticated technology is not beyond the development corporations. PanArctic Inuit Logistics Corporation (PAIL) operates the North Warning System on behalf of the Department of National Defence, in partnership with ATCO Frontec. Seven Inuit development corporations are equal owners of PAIL: the Inuvialuit, Nunasi, Makivik, Labrador Inuit, Qikiqtaaluk Corporation, Sakku Investments Corporation, and Kitikmeot Corporation. Several regions are also involved in bringing high-speed broadband digital service to 57 northern communities through the Broadband Business Alliance Limited Partnership (BBALP) contract with SSI Micro: Denendeh Investments Inc., Tetlit Gwichin Council, Deline Land Corporation, Dehcho Economic Corporation, Tlicho Investment Corporation, and Akaitcho Regional Investment Corporation. Social Benefits A regional development corporation stands to create more and better jobs for Land Claims beneficiaries. Better jobs mean better incomes and benefits and employment opportunities for workers. When development corporations develop new businesses they also develop the talent pool within their region. They stimulate the development of skilled workers, administrators, and entrepreneurs. The creation of skilled workers, administrators, and entrepreneurs is dependent on people having the opportunity to gain experience and learn on the job. Research has shown that good jobs and incomes are related to a variety of direct and indirect benefits for individuals and communities. These real and potential benefits include: Improved family nutrition; Improved mental health; Improved incentives for young people to stay in school and acquire postsecondary education and skill training; Improved work experience and job mobility for workers; Reduced dependency on Income Support; Reduced encounters with the criminal justice system; Improved community-level investments in infrastructure and businesses serving local and regional needs; Greater local control of economic decision-making and resources and participation in regional industrial activities.
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When regions participate in development activities within their communities, and outside the region as their businesses generate enough income to do so, they achieve one of the most important benefits of allthe resiliency to withstand setbacks in the economy and the flexibility to minimize hardships and rebound as opportunities arise.

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CHAPTER 3. Native Economic Development: Lessons from Elsewhere Native economic development matters in other countries besides Canada. Research in two countries with large aboriginal populations is examined briefly here for comparison with Canadian experience. Researchers in the United States and New Zealand have tried to identify the critical conditions for, and the essential elements of, a successful native economic development model. The Harvard Project on American Indian Economic Development The Harvard Project, based at Harvard University, aims to understand and foster the conditions under which American Indian nations achieve sustained, self-determined social and economic development. The Project operates in association with the Native Nations Institute at the University of Arizona. Beginning in 1987, through applied research and service activities, the Project has tried to answer three key questions: What works? Where does it work? And Why does it work? The questions recognize that some of the many Indian nations in the USA, large and small, have experienced economic success while others have not. The research and case studies carried out by the Project identify three key determinants of economic success: Sovereignty matters. When Native nations make their own decisions about what development approaches to take, they consistently outperform external decisionmakerson matters as diverse as governmental form, natural resource management, economic development, health care, and social service provision. Institutions matter. For development to take hold, assertions of sovereignty must be backed by capable institutions of governance. Nations do this as they adopt stable decision making rules, establish fair and independent mechanisms for dispute resolution, and separate politics from day-to-day business and program management. Culture matters. Successful economies stand on the shoulders of legitimate, culturally grounded institutions of self-government. Indigenous societies are diverse; each nation must equip itself with a governing structure, economic system, policies, and procedures that fit its own contemporary culture.
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Two additional key factors were added later: Leadership. Nation building requires leaders who introduce new knowledge and experiences, challenge assumptions, and propose change. Such leaders, whether elected, community, or spiritual, convince people that things can be different and inspire them to take action. Strategic thinking. The Indian nation has moved away from crisis management and opportunistic, quick-fix responses to development dilemmas and toward long-term decision-making that incorporates community priorities, concerns, circumstances, and assets. These five factors do not guarantee success, but they make it more likely. The researchers suggest that where these key determinants are in place, assets such as education, natural resources, access to capital, and location in respect to markets are more likely to pay off. On the other hand, where some of these five factors are not in place, the other assets are likely to be wasted. The researchers conclude that businesses that are protected from political interference are more likely to be profitable than those that are not. The Context for Maori Economic Development The New Zealand Treasury prepared a background paper by this title in 2005, at the request of the Maori people for an important assembly (Hui Taumata in the Maori language). The Maori, located throughout the islands, represent significant numbers and wealth in the New Zealand economy, although lagging the non-Maori majority in ways similar to Canada and the United States. Maori economic development is understood as a key contributor to the national, export-based economy, with prospects for growing participation in the Asian and global economy. The Maori represent 15% of New Zealands population. Settlement of claims for confiscated Maori lands made since 1992, a process which still continues, has given the Maori ownership of significant portions of New Zealands export industries and thereby makes them important contributors to the national economy. One settlement, for $170 million, gave the Maori control of at least 20% of New Zealands lucrative fishery quota. Other large settlements have given the Maori an important stake in agriculture and forestry, also important sources of export earnings. Maori contribution to the countrys Gross Domestic Product rose from less than 2% in 2003 to 5.4% in 2006, making them important
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international players. At that time, Maori commercial assets, privately and collectively owned, were valued conservatively at $16.5 billion. The Treasury analysts identify five key drivers of Maori economic development: Skills and talent; Innovation and technological change; Investment; Entrepreneurship; and Sound institutions.

From these five drivers the Treasury Paper identifies three key considerations in developing an agenda for Maori economic development: developing people; developing enterprises; and developing assets (which may involve dealing with tensions over the appropriate use of collectively owned lands and resources). The paper picks out people as the key determinant of Maori economic development over the next 20 yearswhether as employees, owners, governors, managers or eldersand whether acting individually or collectively. The most significant contribution to Maori economic development over the next 20 years is likely to come from improving the education and skills of Maori people. The effects of such improvements are likely to be wide-ranging and long-lasting. They include increased access by Maori to employment and higher incomes, the effective governance and management of Maori enterprises, and the sustainable development of Maori commercial assets. The entrepreneurial skillsleadership, management, and governancein part involve achieving a balance between commercial management skills and traditional leadership skills. Also required is balancing stakeholder involvement in decision-making with the need to respond promptly to opportunities and risks. The paper echoes the findings of the Harvard Project. The economic activities of individuals and enterprises can be either supported or discouraged by the rules, systems and institutions that exist in society. There is a need to focus on these institutional foundations for economic development, and ensure that they provide an environment in which people and businesses have incentives to improve their economic participation and productivity. Governments play a key role in this regard, but so do the formal and informal rules, systems, values and institutions that exist within Maoridom.
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CHAPTER 4. A Model of Regional Economic Development The comprehensive land claims settled by aboriginal peoples in northern Canada meet the criteria for success identified in Chapter 3: sovereignty, institutions, and culture. The terms of the final agreements recognize sovereignty through ownership of land and resources and through financial compensation. Control over land and resources, and substantial federal transfers of money, create the potential for sound institutional development. The final agreements set out terms that support the disciplined management of the funding transferred to run those institutions. Where careful investments are made, even in the face of major setbacks like the recent global recession, beneficiaries can be confident that over time their wealth will grow, their social needs will be addressed, and their institutions will function in ways that support cultural values and aspirations and inspire confidence. Where leadership and strategic thinking are also present, social and economic success are more likely to happen than where they are missing. The regional development corporations in each region have good features that other regions can learn from and possibly use to their advantage. These features are grouped in the model below under Governance, Goals and Objectives, Business Development Strategy, Scope of Activities, and Role of Government. Regions whose website information places a strong emphasis on certain features are noted. Figure 1 A Model Economic Development Corporation
Governance Regional emphasis Inuvialuit Gwichin Tlicho Nunasi James Bay Nunatsiavut Inuvialuit Gwichin Tlicho Nunasi Osoyoos Feature The Development Corporation, as a birthright corporation, is a wholly-owned subsidiary of the aboriginal government.

The business and investment activities of the Development Corporation are separated from the aboriginal governments political activities through an independent board of directors appointed by the aboriginal government.

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Governance

Regional emphasis Gwichin

Feature Governance policies and practices are clear and impartial and clearly communicated to beneficiaries and industry seeking access to Settlement Area lands. Clear standards are set which beneficiary-owned businesses must meet to be eligible for contracts with industry or government. Investment policy includes benchmark rates of return and dispersed professional management and oversight of the investment portfolio. Community economic development initiatives are also managed by an independent board of directors where community economic development corporations exist. All communities in the region are represented on the board of directors, and the board chair is a beneficiary. Non-beneficiaries with relevant expertise may be appointed to the board. Economic development plans are required. Social as well as economic development, with concern for protection of land, culture and quality of life. Support for the traditional economy as well as for business development and wealth creation. Emphasis on education, training, and skill development for beneficiaries. Ownership of local and regional ventures.

Gwichin

Inuvialuit Gwichin Nunasi Gwichin

Tlicho

Yukon Goals and Objectives All regions

Most regions

All regions

Business Development Strategy

Most regions

Larger, wealthier regions

Focus on and investment in regional industrial projects, multi-region northern services, and national ventures of regional significance. Mix of majority ownership, equal ownership and minority investment with joint venture partners.

Most regions

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Business Development Strategy

Regional emphasis

Feature

Inuvialuit Gwichin Nunasi Denendeh DC

Aboriginal joint ventures with majority, equal, or minority ownership in businesses aimed at meeting specific needs of beneficiaries. Non-competitive alliances and multiple partnership arrangements with other aboriginal partners to provide essential services needed across regions. Commercial lenders

Denendeh DC NWT Metis Nation North Slave Metis Tlicho Nunatsiavut Nunatsiavut

Targeted industrial investments and training. Combination of traditional skills with education and training. Operational control in industrial megaprojects through ownership and joint ventures. Aggressive approach to exploiting the regions non-renewable natural resources. Professional advice to and direct investments in community-based initiatives. Flexible investment practices in response to economic conditions. Regional advisory and educational support for small and isolated communities. Tightly integrated utilization of the regions natural and human resources to meet business, cultural, and educational objectives. Commitments from governments to planning and participation in megaprojects.

Alaska North Slope

Scope of Activities

Inuvialuit

Inuvialuit

Dehcho

Osoyoos

Role of Government

Nunatsiavut Innu Yukon Gwichin, Sahtu, James Bay, Yukon Nunavik

Contracting provisions

Access to fisheries licences and quotas and overlap agreements with Nunavut, Crees, and Labrador Inuit.

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CHAPTER 5. Towards A Sahtu Development Corporation Chapter 2 describes the economic development corporations created by land claim settlements in northern regions. Chapter 3 summarizes research findings that identify the essential foundations of successful aboriginal economic development. And Chapter 4 presents a conceptual model of a regional economic development corporation taken from the two preceding chapters. It remains to make an assessment of the Sahtus readiness to move forward and develop a regional development corporation of its own. This chapter looks at the assets and achievements of the Sahtu region to date and makes a brief environmental scan of the potential economic opportunities in the region. The purpose is to assess the regions capacity to exploit those opportunities, and to identify the benefits of a regional economic development corporation. Settlement of the land claim in 1993 confirmed the sovereignty of the Sahtu Dene and Metis and established the financial and institutional means to build the governance and operational institutions needed to achieve self-sufficiency in the regionthrough culturally appropriate programs and services to reach social and economic objectives. The governance institutions support operational institutions in the communities. The community-based land and financial corporations have developed local and regional business ventures, and joint venture partnerships, some of which are partnerships between the local economic development corporations. These businesses, wholly owned or joint ventures, have been the means to employment, training, and learning on the job opportunities for beneficiaries, and the building of relationships with external industrial corporations active in the Settlement Area. Chapter 12 of the Land Claim Agreement also commits the federal and territorial governments to support for business development, contracting opportunities, and learning opportunities for beneficiaries through employment, training, and education. In other words, important baseline criteria are in place for developing people, enterprises, and assets.

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Assets and Achievements Sahtu Dene and Metis Land Claims Agreement (1993) ratified by Parliament through the Sahtu Dene and Metis Land Claim Settlement Act (1994)

Significance Established the sovereignty of the Sahtu Dene and Metis, with surface and subsurface rights to lands in the Sahtu Settlement Area. Provided compensation ($130 million over 15 years) and guaranteed a share of government resource royalties in the Mackenzie Valley. Identified basic objectivesself-sufficiency, support for the traditional economy, and full participation of beneficiaries in the mainstream economy. Created the authority and the revenues to build culturally appropriate governance institutions and operational institutions that meet the social and economic needs of beneficiaries. Regional and local councils and boards with mandates, departments and staff. Sahtu Secretariat coordinates regional activities, distributes land claims funding, and functions as point of contact for government programs. Land and financial corporations with mandates, departments and staff. Participation in co-management boards responsible for land and resource management. Research and publications capacity. Memberships and relationships with other regions, national and international bodies. Websites providing information for each community and enterprise. Wholly owned and joint venture partnerships, with local and/or regional focus in each community. Commitments from federal and territorial governments to maximize local and regional employment and business opportunities (Ch. 12) Memorandum of Understanding with the Government of the NWT to improve contracting opportunities for Sahtu businesses and training, education, and employment opportunities for beneficiaries (2007- 2012). Training of beneficiaries for oil and gas exploration jobs and support for education. Pipeline construction for the Mackenzie Gas Project and ongoing oil and gas exploration. Mackenzie Valley Highway Extension Project.
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Governance and Operational Institutions

Business Ventures

Potential Regional Economic Opportunities

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Mining development of the Selwyn Chihong Minings lead-zinc project at Howards Pass. Mining exploration in the Great Bear region. Hydro-electric for small-scale community projects and pipeline-related industrial use. Potential for alternative energy developments to replace diesel power generation and reduce power costs. Includes solar and wind power. Tourism and management opportunities related to the Saoyu/?ehdacho National Historic Site and the five other projects under study or proposed for designation as NWT Protected Areas Strategy sites, and the Canol Heritage Trail.

A brief environmental scan is enough to indicate that the Sahtu region, and each of the Sahtu communities, is situated in an area of high non-renewable resource potential for large-scale industrial development (and potential local spinoff ventures). A decision on the Mackenzie Gas Project is expected by 2016. A decision to build the pipeline would surely spur continued exploration work in the region, for which some beneficiaries already have training. It would also provide contracting opportunities for Sahtu-owned businesses supplying helicopter, heavy equipment, expediting and camp services, and opportunities for ongoing maintenance contracts. Construction of the pipeline would almost certainly be accompanied by government action to extend the Mackenzie Valley Highway, creating similar opportunities. Mining activity in the region is also promising and likely to continue, and steps to develop hydro-electric power and/or technologically sophisticated alternative energy projects are already being taken. With five areas of ecologically and culturally important land being actively reviewed for designation as Historic Sites, and a sixth one having been proposed, every community in the region has potential opportunities for eco-tourism and heritage development, land and resource management, and scientific research potential to take advantage of. One question to answer will be: Is the Sahtu currently in a position to best take advantage of these opportunities as they unfold? The evidence presented in this discussion paper suggests that one institution that would put the region in a stronger position is missinga region-wide Sahtu economic development corporation. A regional development corporation would allow the communities to pool existing financial resources and
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managerial capacity and, if need be, to hire external expertise to undertake region-wide projects and support future community-based ventures. A Sahtu Development Corporation would be able to engage industry in negotiations involving region-wide major projects within the Settlement Area, speaking with one voice for the entire region. It would be able to do the same with the federal and territorial governments. When all of the existing assets and achievements to date, and the potential opportunities for the future are taken into consideration, it is reasonable to conclude that one remaining institutional piece should be put in place to strengthen the Sahtus capacity for economic developmenta Sahtu Development Corporation. It is anticipated that the communitybased economic development corporations within the Sahtu will both be able to realize a large volume of work, revenue and profits from their involvement in a region-wide corporation, while continuing to have control of the local work they now have on the go. One straightforward task that could be assigned to the Sahtu Development Corporation would be to make it the repository of the Sahtu Business List which outside contractors will need to be able to access for the Mackenzie Gas Project. Next Steps Given the regions experience negotiating a land claim and building governance and operational institutions with working mandates, the process involved in creating a Sahtu Development Corporation should pose no difficulties. Major decisions and steps would include the following: 1. Hold the already proposed regional leadership workshop to consider the merits of the idea. 2. Consult with the community leadership and community residents to obtain feedback. If it is clear that there is strong support: 3. Hold a regional leadership vote to establish the Sahtu Development Corporation. 4. Nominate individuals to staff and develop the structure and mandate of the new organization. 5. Establish an office. 6. Direct funding into the development corporation for salaries, operations and project development. Conclusions
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This discussion paper has examined existing land claim agreements to uncover what it is within the operating environments of their regional economic development corporations or similar institutions that might present a model for the Sahtu region. The model presented in Chapter 4 was extracted from the descriptive summaries of eighteen northern development corporations and research findings into the essential foundations of successful aboriginal economic development. The purpose of the survey has been to identify the governance structures, methodologies, and other features that could ultimately increase the regions capacity to take advantage of economic development opportunities in the Sahtu. It will be up to the Sahtu leadership to decide whether or not a regional economic development corporation should be created. A simple decision-making model looks at the strengths and weaknesses of an organization, and at the opportunities and threats the organization faces in its operating environment. The assets and achievements to date, and the real and potential opportunities in the region, suggest that the Sahtu has clear strengths and opportunities, while the weaknesses and threats are internal and easy to overcome. The evidence presented in this paper suggests that a Sahtu Development Corporation would fill an institutional gap and could achieve useful outcomes for Sahtu communities, individuals, businesses, and the existing economic development institutions in the region. It is anticipated that the community-based economic development corporations within the Sahtu will both be able to realize a large volume of work, revenue and profits from their involvement in a region-wide corporation, while continuing to have control of the local work they now have on the go. The end goal would be to have a suitably sized business to capitalize on big opportunities, such as a Mackenzie Valley Highway Extension or the Mackenzie Gas Project. At the present time any project over a few million dollars goes to contractors from outside the region. It is time for the region to take on this larger work as a collective body. It is time for the Sahtu to become effective players in the big-picture economy of the region. One of the lessons to be taken from this survey paper is that critical mass of financial and human resources makes a difference. A regional body operating with a larger pool of capital, managed by experienced professionals, has more resources for responding to regional and community needs and opportunities than smaller, local enterprises operating
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alone. A regional economic development corporation is also more likely to have influence with government and industry than individual communities. Another lesson learned is that the benefits of regional development build up over time, creating wealth that gives a region the flexibility to take advantage of new opportunities, and the resourcefulness to deal with setbacks. That has been the experience for the Inuvialuit, for Nunasi Corporation, the Makivik Corporation and the Alaska North Slope, and for other regions with more recent settled land claims. Whatever problems might arise in the short term, from the longer term the Sahtu could look back and see how far it has come.

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APPENDIX. Development Corporations in Northern Canada and Alaska This chapter provides descriptions of economic development corporations in regions of the Northwest Territories, northern Quebec, and Labrador with settled land claims. Economic development efforts in regions without settled land claims and pan-territorial development corporations are also examined. Yukon and Alaska are included in the scan, for a total of sixteen regions in all. Inuvialuit Regional Corporation The Inuvialuit Final Agreement (IFA) was signed in 1984 and subsequently brought into law by the Government of Canada through the Western Arctic (Inuvialuit) Claims Settlement Act that same year. It was the first comprehensive land claim agreement signed north of the 60th parallel and only the second in Canada at the time. The IFA gave the Inuvialuit ownership of 91,000 square kilometers of land, including 13,000 square kilometers with subsurface rights to oil, gas and minerals. Financial compensation from the Canadian government totaled $169,500,000 over 14 years. There are approximately 4,000 Inuvialuit beneficiaries in the six communities within the Inuvialuit Settlement Region (ISR). The Inuvialuit Regional Corporation (IRC) oversees the political, social, and economic affairs of the Inuvialuit, with input from six Community Corporations. The mandate of the IRC is to continually improve the economic, social, and cultural well-being of the Inuvialuit. The corporate goals of the IRC include: the preservation and growth of the financial compensation flowing from the Final Agreement; the distribution of accumulated wealth to beneficiaries; and the provision of technical and administrative support to community corporations and beneficiaries. The IRC is the sole shareholder in the Inuvialuit Development Corporation (IDC), which is responsible for economic development activities in the Inuvialuit Settlement Region. IDC is the sole owner and/or majority partner or minority investor in various joint ventures totaling more than 20 companies. IDC is the largest of four income-generating subsidiaries which make up the Inuvialuit Corporate Group. The other three are the Inuvialuit Investment Corporation (IIC), responsible for managing an investment portfolio that provides revenue for a range of programs; the Inuvialuit Petroleum Corporation (IPC), which has a one-third ownership in
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the Ikhil Natural Gas Project; and the Inuvialuit Land Corporation (ILC), responsible for land use permits, leases, and related matters. The 25th anniversary of the Inuvialuit Final Agreement was 2009, the most recent year for which financial information is available. In 25 years the net worth of the Inuvialuit Corporate Group has more than doubled, in spite of recent losses caused by the global recession, to $362.5 million. Inuvialuit Development Corporation The first annual report of the IRC, for 1984, described the Inuvialuit Development Corporation as the vehicle by which the Inuvialuit would achieve greater self-sufficiency through sound economic and business ventures: The overall goal of the Inuvialuit Development Corporation is to establish a stable, long-term economic base which will allow the Inuvialuit to contribute to and benefit from the regional and national economy. Some of the benefits to be gained include: economic growth through investment and profit improvement of regional services greater long-term opportunities for employment and training a more stable economy through recycling of profits and wages through this region.

The Inuvialuit Development Corporation is an aboriginal birthright development corporation, a 100% Inuvialuit-owned holding company. Its role is to: evaluate investment opportunities; monitor and maximize investment in the NorTerra Group of companies, which IDC owns in partnership with Nunasi Corporation of Nunavut; and seek ways to grow and diversify the IDC portfolio within the Inuvialuit Settlement Region.

IDC conducts its business through more than 20 subsidiaries and joint ventures in five business sectors: energy services, transportation, manufacturing and industrial, northern services, and environmental services, and property management and real estate. From its headquarters in Inuvik, IDC maintains the majority of its assets in the Northwest Territories, and the remainder in southern Canada. IDC is the economic and employment
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engine for IRC. It generates wealth through continued investment activity; it increases Inuvialuit human resource capacity through formal career development and advancement programs; and it protects and secures IRCs future through formal business planning, new venture formation and portfolio management. FIGURE A-1 Inuvialuit Development Corporation Main Holdings Sector
Energy Services

Companies
Akita Equtak Drilling Ltd.

Services
50/50 equity joint venture between IDC and Akita Drilling, providing drilling services and crews in the Arctic onshore and offshore and outside the NWT Catering and camp support services to exploration companies. 85% of employees are Inuvialuit beneficiaries Environmental and engineering services. Joint venture between IDC and Klohn Crippen Berger Ltd. Engineering and land surveying, land and project development, training surveyors IDC partnership with Challenger Geomatics Ltd. Services for the full well lifecycle, from seismic acquisition to well completions, testing, etc. Joint venture with Schlumberger Canada Ltd. Regional air carrier Air cargo and aircraft ground handling and delivery services. Joint venture partner with Braden-Burry Expediting Air cargo and aircraft ground handling, freight forwarding and related services. National air carrier Inland and marine barge services to NWT and Nunavut communities and industry. Major construction and project management in the NWT and elsewhere, including Alaska Industrial supplies and equipment Full range of pipe products and services. Joint venture between IDC, NTCL and Hallmark Tubulars Ltd. WDM, Weldco Hydra-lift, Weldco Heavy Industries Entry level and trades training for land claim beneficiaries in northern Canada Food distribution and store operations, camp provisioning and catering onshore and offshore Page 34 of 83

Arctic Oil and Gas Services Inc. (AOGS) IEG Consultants Ltd.

Inukshuk Geomatics Inc.

Inuvialuit Oilfield Services (IOFS)

Transportation

Aklak Air Aurora Expediting Services Ltd.

Braden-Burry Expediting Canadian North Northern Transportation Company Ltd. (NTCL) Manufacturing and Industrial Dowland Contracting Ltd. Northern Industrial Sales Mackenzie Integrated Tubular Solutions (MITS) Weldco Companies

Northern Services

Nasittuq Stanton Group Ltd.

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Tundra Communications

Telecommunications services in ISR partnership between IDC and Northwestel Office, commercial, and residential buildings for rent in the ISR Management and holding company; IDC and Nunasi Corporation are equal owners.

Management and Real Estate

IDC Properties NorTerra Inc.

The NorTerra Group of companies includes major corporations and significant regional services that meet fundamental regional needs and operations beyond the ISR. These companies include: the Northern Transportation Company Ltd., acquired in 1985 from the Government of Canada in partnership with Nunasi Corporation (the founding acquisition of the NorTerra Group); Canadian North, a mainline air carrier serving northern and southern Canada; Stanton Distributing, a regional grocery store and food distribution company; IDC Properties, a property management company; Aklak Air, a regional air carrier; Arctic Oil and Gas Services (AOGS), providing catering, fuel, and other camp services for the Oil and Gas industry, 85% of whose employees are Inuvialuit; and Dowland Contracting Ltd., with recent contracts to build the super school, the Western Arctic Research Centre, GNWT office building, and IDC/Coast Guard building in Inuvik, and construction projects elsewhere.

Inuvialuit Investment Corporation The Inuvialuit Investment Corporation is responsible for managing an investment portfolio of stocks and bonds. This portfolio was established with the federal monies paid out as part of the Inuvialuit Final Agreement. Its mandate is to achieve the highest possible returns using conservative investment strategies and to increase financial resources to benefit future generations of Inuvialuit. IICs specific objectives are to: protect the value of the investment funds; earn a before-tax real rate of return of 5% over the long term; and manage investment funds on behalf of other members of the Inuvialuit Corporate Group, the Inuvialuit Harvesters Assistance Trust, and the Community Corporations.

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The earnings from the investment portfolio support various obligations under the IFA: funding to operate the Community Corporations; a share of the annual distribution to beneficiaries; management fees to IRC; and other administrative expenses. Inuvialuit Petroleum Corporation The Inuvialuit Petroleum Corporation was created in 1985 with the objective of becoming a profitable, medium-sized, diversified, and integrated petroleum company. After selling off southern business interests due to exploration inactivity, IPC has invested the proceeds through the Inuvialuit Investment Corporation, waiting for a turnaround in oil and gas exploration. IPC also has one-third ownership in the Ikhil/Inuvik Natural Gas Project, which supplies natural gas to Inuvik for power and heating. The project is owned equally by IPC through its subsidiary Ikhil Resources Ltd., AltaGas Services Inc., and Enbridge Inc. IPC contributed approximately $14 million towards the $44 million project. Inuvialuit Land Corporation The Inuvialuit Land Corporation holds title to Inuvialuit lands. It is considered to be a revenue-generating subsidiary of the IRC, although revenues are small and not reported every year. The ILC generates revenues through granting oil and gas concessions on Inuvialuit lands. Inuvialuit Corporate Group Financial Performance 2005-2009 The Inuvialuit Development Corporation had revenues of $221 million in 2009, the worst year of the global recession, when it recorded an after-tax loss of $17.3 million. That represented a major decrease from 2007, when IDC turned a profit of $13 million on revenues totaling $269 million. The Inuvialuit Investment Corporation, on the other hand, recorded net earnings of $26.5 million in 2009, and a net value of $182 million, down from $193.4 million in 2007. Direct benefits to Inuvialuit beneficiaries included $12.6 million in wages, while equity in the Inuvialuit Corporate Group was $362.5 million. Table 1 summarizes the overall financial operations of the Inuvialuit subsidiaries in the Inuvialuit Corporate Group over the most recent five-year period. The table shows that the Inuvialuit were generating substantial after-tax earnings up until 2008, when the global recession took hold. In spite of the reduced earnings in 2008 and the loss incurred in 2009, the minimum cash payout to beneficiaries of $400 was maintained for those years, and was much higher in previous years. (In fiscal year 2000, after-tax earnings reached $52,500,000 and the individual payout to beneficiaries was $850.49.) The individual payouts to
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beneficiaries give every Inuvialuit an incentive to take a serious interest in IRCs activities in the regional, national, and international economy. TABLE A-1 Inuvialuit Corporate Group Financial Performance 2005-2009
Year After Tax Earnings (Losses) ($17,346,000) 3,824,000 35,179,000 36,459,000 19,545,000 Beneficiary Distribution Total Individual Beneficiaries 3,989 3,912 3,812 3,726 3,650

2009 2008 2007 2006 2005

$1,595,600 $400.00 1,565,000 400.00 3,816,155 1,001.09 2,869,470 770.12 1,744,651 477.99 Direct Benefits to Beneficiaries From ICG Resources $17,879,299 21,102,222 20,285,992 17,345,371 18,151,624 Equity in ICG $362,584,000 381,841,000 382,216,000 350,234,000 315,825,000

2009 2008 2007 2006 2005

Employee Wages $12,629,242 13,786,608 13,467,600 11,470,148 11,411,625

Contribution Agreements $11,000,000+ 11,600,000 8,600,000 8,700,000 6,000,000

Direct benefits to beneficiaries have been in the range $17-21 million over the five-year period. Employee wages ranged from $11 million to nearly $14 million annually of that amount. The remainder was expended on a variety of community projects, support for education and elders, and donations of various kinds within the region. Total equity in the Inuvialuit Corporate Group declined somewhat in 2009 from a high in 2007, but remains more than double the original land claims settlement at $362.5 million. Besides its direct business and investment activities, IRCs organizational and managerial strengths make it an attractive partner for the federal and territorial governments. Both levels of government have raised the amounts in their contribution agreements recently to support wellness and social development programs and capacity-building efforts in the ISR. Table 2 breaks down the results for the three profit-earning members of the Inuvialuit Corporate Group for the years 2005-2009. The Inuvialuit Land Corporation seldom reports earnings.

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The table records the impact of the 2007-2009 recession on the revenues, profits, wages and employment numbers, and donations made by the Inuvialuit Development Corporation (IDC). IDC had revenues of $221 million in 2009, the worst year of the global recession, when it recorded an after-tax loss of nearly $15 million. That represented a major decline from 2006, when IDC turned a profit of more than $19 million. In spite of the recession, wages paid to beneficiaries remained at nearly $8.7 million in 2009, paid out to 290 beneficiaries, and donations exceeded $700,000. TABLE A-2 Inuvialuit Subsidiaries Financial Performance 2005-2009 Year
Revenue 2009 2008 2007 $221,146,000 309,396,000 268,984,000

Inuvialuit Development Corporation

After Tax Profit (Loss) ($14,995,000) 2,713,000 13,115,000 Wages Paid to Beneficiaries $8,690,502 10,020,000 9,970,000 Beneficiaries on Payroll 290 391 430 Donations $732,000 467,000 1,114,000

2006 2005

229,314,000 187,605,000

19,403,000 8,346,000

8,400,000 Not reported

Not reported 200 full-time equivalent positions

1,400,000 1,600,000

Inuvialuit Investment Corporation Heritage Fund

Net Market Value 2009 2008 2007 2006 2005 $181,926,000 146,932,000 197,860,000 195,000,000 176,300,000 Profit (Loss) ($6,380,000) 1,904,000 9,275,000 10,505,000 7,969,000
Return (4-yr avg)

Inuvialuit Petroleum Corporation

Portfolio IIC/Ikhil* Earnings down Earnings down Not reported Not reported Not reported Earnings $89,000 1,387,000 2,975,000 2,975,000 Not reported

Target 3.1% 1.2% 10.6% 12.4% 11.3%

3.0% 0.8% 10.3% 14.1% 10.8%

* Following the sale of IPCs southern business interests, the proceeds were invested in IIC. IPC also owns a one-third share in the Ikhil Natural Gas Project which supplies Inuvik.

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The Heritage Fund managed by the Inuvialuit Investment Corporation, the returns from which fund the administration of the Inuvialuit Regional Corporation and the community corporations and other expenses, recorded a decline in earnings to $1.9 million in 2008 and a loss of $6.4 million in 2009, well down from the typical earnings of previous years in the $8 to $10 million range. Benchmarks for earnings set on a four-year evaluation period were also brought down sharply for 2008 and 2009. Close monitoring of investments, however, has kept the rates of return close to, or above, the targets. The slowdown in oil and gas exploration prompted the Inuvialuit Petroleum Corporation to sell off southern business interests several years ago and invest the proceeds through IIC pending better opportunities. Portfolio earnings for the Inuvialuit Petroleum Corporation are not reported separately from the IIC returns. Spinoff Benefits The managerial expertise and financial capacity of the IRC, combined with its legal authority and political reach, make it an attractive partner for major corporations, investors, and government program managers. Between 2005 and 2009, government contributions to support IRC programs almost doubled, from $6 million in 2005 to over $11 million in 2009. The wealth generated by the Inuvialuit subsidiaries enables IRC to be an active partner in the development initiatives of the six Community Corporations in the ISR. For example, the Paulatuk Community Corporations Paulatuk Development Corporation has recently expressed an interest in buying a mining camp for lease to Darnley Bay Resources Ltd. and other mining companies. The regional Inuvialuit subsidiaries are investors in, and partners with, community initiatives of this type. In addition to the direct economic benefits created by the various Inuvialuit businesses, there are spinoff benefits of many types as well, for example: Environmental backhaul by Northern Transportation Company Ltd. (NTCL) from the communities it serves at discounted ratescleanup, removal, and sale of domestic recyclable waste material; and training of community residents in handling and disposal of hazardous waste products (16 trainees in Tuktoyaktuk in 2010).

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Career exposure through the Annual IDC Arctic Youth Leadership Expedition: Inuvialuit youth toured NTCL and other Inuvialuit businesses in Hay River in 2010 to gain awareness of career, education and training opportunities. Corporate donations by Inuvialuit businesses for social and charitable purposes. Flexibility in asset management: The Inuvialuit Petroleum Corporation sold off southern assets in 2007 in response to the downturn in oil and gas activity, and invested the cash from the sale in the Inuvialuit Investment Corporation pending a return to opportunity in the resource sector.

Gwichin Region The Gwichin Comprehensive Land Claim Agreement was signed in 1992 and brought into law by the Government of Canada through the Gwichin Land Claim Settlement Act that same year. The Gwichin Settlement Region consists of the Gwichin Settlement Area in the Mackenzie Valley of the Northwest Territories and Primary Use and Secondary Use lands in Yukon. The Final Agreement gave the Gwichin Tribal Council ownership of 16,264 square kilometers of land in parcels located throughout the Gwichin Settlement Area (GSA) and Yukon. On the parcels of Gwichin-owned land within the GSA, the Gwichin have either surface rights or subsurface rights, or both. There are more than 2,400 Gwichin beneficiaries in the four communities within the Settlement Area. The beneficiaries are referred to as Participants. The Final Agreement provided tax-free capital transfers in annual installments totaling $141 million over 15 years, less repayment of the negotiation loans of $8.1 million. The final payment in 2007 resulted in a net balance in the Gwichin Settlement Fund, called Gwichin Legacy Capital, of $134.7 million. This amount exceeded the original fund objective of $132 million. A fundamental objective of the Gwichin Comprehensive Land Claim Agreement (GCLCA) is to encourage the self-sufficiency of the Gwichin and to enhance their ability to participate fully in all aspects of the economy. Consequently, one of the objectives of the Gwichin Tribal Council is to develop and promote economic, social, educational and cultural programs that will enable the Gwichin to become self-sufficient and full participating members in the global economy.

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Gwichin Development Corporation The Gwichin Development Corporation (GDC) is 100% owned by the Gwichin Tribal Council. The GDC is an investment company with two goals: To increase revenues through development activities within the Gwichin Settlement Region; and To ensure that Gwichin beneficiaries are involved in training, employment and business opportunities created from these activities.

Joint venture partnerships with experienced companies eager to work in the Settlement Area are the key to achieving these goals. The joint ventures combine outside expertise with Gwichin traditional knowledge and experience of geography and culture. We look for partnerships that promise to deliver profits for both partners, training for our people and sustainable development for our land. The GDC currently has investments in five strategically important regional industries: construction, real estate, hospitality, transportation, and the energy sector, chiefly oil and gas exploration and development. The Gwichin share in these ventures ranges from 100% ownership to majority or minority participation. Partners include other northern aboriginal ventures, such as the Denendeh Development Corporation, and southern corporations. Head offices for these ventures may be located in the GSA or in southern Canada. The GDC Annual Report for 2009-2010 reports investments in twelve subsidiaries, not all of which are active, due to the downturn in oil and gas exploration and continuing uncertainty over the Mackenzie Valley Pipeline project. These subsidiaries employ approximately 75 full-time and 30 seasonal workers. Most of them are Gwichin beneficiaries. GDC investments as of 2009 were: 44% in Portfolio Investments (promissory notes, debentures and advances); 42% in Hospitality and Real Estate; 12% in Construction and Transportation; and 2% in Energy Development. The Gwichin Land Claim Agreement gives Gwichin businesses preferential access to tenders and contracting opportunities when the federal and territorial governments undertake projects on Gwichin lands. Private corporations require permission from the
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Gwichin Tribal Council before they can undertake projects on Gwichin lands. These measures seek to maximize local and regional opportunities for Gwichin businesses and employment for Gwichin beneficiaries. FIGURE A-2 Gwichin Development Corporation Main Holdings
Industry/ Corporation Construction Gwichin MAC Ltd. Bobs Welding & Heavy Equipment Repairs Ltd GTM Enviro Services Ltd Energy Development Aadrii Limited Gwichin Ensign Oilfield Services Inc. Mackenzie Valley Aboriginal Pipeline Corp. Real Estate GDC-NNP Limited Partnership Inuvik Commercial Properties Zheh Gwizu Hospitality Inuvik Capital Suites Zheh Gwizu Larga MG Lodging Inuvik Ltd. Transportation Gwichin Helicopters Ltd. Services Gwichin Share Dec. 31, 2009 Revenue ($) -3,660,652 24,385 Profit (Loss) ($4,898) (264,354) (191,980)

Pipeline construction Welding, HE repairs, rock crushing, transport & barging Brushing & landscaping, strata maintenance Recover and distribute diesel generated heat Ft McPherson Drilling, well services, testing

100% 51% 100%

50% 51% 33.3%

217,890 Inactive --

112,729 ---

Residential, commercial, & industrial property development Commercial, retail, and office property management (Inuvik and Yellowknife) Executive suites

50% 37.5%

Not reported 4,500,000

(250,000) $1.0 m ($416K distrib) $64,306 ($80K distrib) $22,100 ($33,190) $58,544

37.5%

2,000,000

Medical boarding home & transportation Full service industrial camp Flight services, management & operations support

37.5% 33.3% 51%

2,227,463 76,214 515,481

Due to the global recession, GDC assets decreased from $49.8 million in 2008 to $36.5 million in 2009. Shareholder equity dipped slightly over the same period from $2.2 million to $2.1 million, and revenues decreased from $6.6 million in 2008 to $5.9 million in 2009. A small loss in 2009 followed a larger one of more than $6 million in 2008. Given the uncertain economic environment and delays in the Mackenzie Valley Pipeline Project, the GDC is looking for investment opportunities outside the GSA.
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Gwichin Settlement Corporation The Gwichin Settlement Corporation is the investment arm of the GTC, established pursuant to Chapter 7 of the GCLCA. The Gwichin Settlement Corporation (GSC) is responsible for receiving and investing the majority of the capital transfer payments from the federal government. Beginning in 1992, these funds were invested in a portfolio of short-term investment certificates. This strategy was later amended to include investment in Canadian bonds and later still to include global equities. Management of the funds has been delegated to several banks and asset management firms, with oversight from an Investment Committee responsible for an investment policy. An independent investment advisor measures performance results monthly and formally reviews results every three months. The fund slightly underperformed benchmarks set for it over the four-year period ending in 2010. The revenue generated from these investments supports the administration of the Gwichin Tribal Council, the four designated Gwichin community councils, and capital distributions to beneficiaries. Since 1996, the fund has returned approximately 6.4%, beating the policy benchmark by 0.2%. However, the Gwichin Legacy Capital stood at $115.3 million in 2010, representing a shortfall from the inflation-adjusted level of $139.5 million. Gwichin Business Development Department The Gwichin Business Development Department, based in Fort McPherson, administers the Gwichin Business Policy. The goals of the Policy are to: Develop Gwichin competencies, skills, and expertise; Ensure that economic opportunities are offered to Gwichin; Encourage meaningful participation by Gwichin in all aspects of the economy; and Increase Gwichin wealth and self-sufficiency.

The Policy provides preferential access to Gwichin-owned businesses to ensure full participation in the regional economy and receive maximum benefit from business and government within the GSA and Settlement Lands. The Policy is meant to ensure that external businesses in the resource development sector have a clear understanding of their responsibilities when doing business in the GSA. The goal is for Gwichin beneficiaries and communities to become economically self-sufficient, while individuals develop business, administrative, and management skills and resources.
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All Registered Gwichin Businesses must agree to follow the Gwichin Business Policy. They must be legitimate Gwichin enterprises able to supply all goods and services on a competitive and timely basis. They must also be able to meet all technical, qualification criteria, health, safety, and environmental standards. A business that is not a Registered Gwichin Business requires the approval of the Gwichin Tribal Council before it can do business on Gwichin Lands. The Gwichin community councils undertake local economic development initiatives. In Fort McPherson, the Tetlit Gwichin Council owns the Rat River Development Corporation Ltd. (RRDC). The RRDC has its own board of directors appointed with a mandate to pursue business interests separate from the Councils political activities. RRDC has three whollyowned local companies, majority ownership in one other, and a minority interest in an environmental engineering and consultancy partnership with Golder Associates Ltd. Spinoff Benefits The revenue generated from Gwichin investments and business activities provide support for a variety of social programs for beneficiaries: Emergency Assistance Fund; Bereavement Assistance Fund; Transportation assistance; Cultural initiatives; Community events; Youth initiatives; Sports and curling.

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Tlicho Region The Tlicho Land Claims and Self-Government Agreement was signed in 2003, exactly 82 years after the signing of Treaty 11 in 1921. It is the first combined comprehensive land claim and self-government agreement in the Northwest Territories, and the second in Canada. The Government of Canada ratified the Tlicho Agreement in 2005 with the passage of the Tlicho Land Claims and Self-Government Act. The Tlicho Agreement created the Tlicho Government and gave the Tlicho ownership of 39,000 square kilometers of land in a single block, including surface and subsurface rights. The settlement includes payment by the federal government of $152 million in annual installments over 14 years, less negotiation loan repayments of $28 million over six years. The Tlicho also receive a share of resource royalties annually from development in the Mackenzie Valley. The Economic Measures chapter in the Tlicho Agreement identifies two objectives: to maintain and strengthen the traditional economy of the Tlicho First Nation; and to achieve economic self-sufficiency for the Tlicho Nation.

The Tlicho Government supports the traditional economy and promotes the marketing of renewable resource products and locally manufactured goods. It also assists in the development of commercially viable businesses and enterprises by Tlicho citizens, and where necessary identifies possible sources of financial assistance. It also provides business and economic training and educational assistance to Tlicho citizens to help them participate in the northern economy, and encourages employment of Tlicho citizens in the public and private sectors, with an emphasis on pre-employment training in basic skills. A Strategic Economic Development Investment Fund of $5 million was established, separate from the other funding paid by the federal government. This funding is earmarked for economic development of Tlicho citizens and the Tlicho Government and the training and education of Tlicho citizens. Tlicho Investment Corporation The Tlicho Government took over all the corporations that were once owned by the individual bands and the Dogrib Treaty 11 Council, including the community-owned development corporations in the four Tlicho communities. The TG now owns over 40
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companies. The Tlicho Investment Corporation (TIC), established in 2005, is wholly owned by the Tlicho Government. The TIC operates as a sole proprietor and as a partner in joint ventures. The Tlicho Investment Corporation Administration Law (2006) makes the TIC the main corporate instrument of the Tlicho Government responsible for the holding, management and oversight of Tlicho Government corporations, shareholdings and other business interests and entities. The TIC is accountable to the Chiefs Executive Council of the GN. Its purpose, and its main objectives, are to: Operate, manage and oversee its active businesses; Act as the holding company for its subsidiaries, interests, and entities; and Exercise supervisory powers over its subsidiaries, interests and entities. A Tlicho entity is a corporation with more than 50% ownership by Tlicho citizens or the Tlicho Government. The Board of Directors of the TIC is appointed by the Chiefs Executive Council. The majority of Board members are to be Tlicho citizens, and each of the four Tlicho communities has at least one board member. The chairperson of the Board is to be a Tlicho citizen. The Chiefs Executive Council approves all appointments to the boards of TIC subsidiaries. The Tlicho Investment Corporation has corporate investments in: construction; human resource services; hydro power; real estate, hotels and travel; and trucking and mining services. These holdings reflect significant needs and opportunities on Tlicho lands (and elsewhere), such as fire fighting services, ice road construction to supply the diamond mines, remediation of old mine sites, and hydro electric development. The local development corporations offer a wide range of essential community services. An online e-commerce store provides an outlet for Tlicho artists and craftspersons.

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FIGURE A-3 Tlicho Investment Corporation Main Holdings

Industry/ Corporation Construction Aboriginal Engineering Ltd Behchoko Development Corporation Lac La Martre Development Corporation Nishi Khon Forestry Nishi Khon Freeway Services TlC Share

Construction survey, mine construction, environmental remediation and reclamation

100% 100%

Tlicho Road Constructors Human Resources I&D Management Services Real Estate, Hotels and Travel Dogrib Nation Trustco Gameti Development Corporation Rae-Edzo Dene Band Development Corporation Wekweeti Development Corporation Hydro Power Dogrib Power Corporation Trucking & Mining Svcs Tlicho Domco Inc. Tlicho Landtran Transport Ltd.

Property management, rental properties, fuel delivery, gas station, heavy equipment rental, home construction, winter road construction Seasonal firefighting, slashing and brush clearing, clearing right of way Land development, freight hauling, gravel sales and delivery heavy equipment services, civil engineering construction Winter road equipment

100%

100% 100%

Behchoko Dev Corp Aboriginal partnership

Employment & HR services, Supplies mine workers to Diavik

Gameti motel, Aurora Caribou Camp, Hottah Lake Lodge, fuel Owns and leases office and real estate space in Behchoko Fuel and freight delivery, taxi, general store, post office, internet service, banking, construction, rental properties, Snare Lake Lodge Hydro electric power generation and supply Remote mining camp services Trucking services, freight mgt and air expediting, ice road construction and transportation to mine sites, hotshot & pilot car, quarrying & rock crushing, Site services Diavik & Snap Lake, mine remediation, bulk fuel trucking to remote mine sites

100%

100%

Domco joint venture

Tlicho Logistics

100%

TIC places a strong emphasis on training Tlicho citizens. The mandate of Aboriginal Engineering Ltd. includes building the capacity of its aboriginal workforce. AEL typically
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maintains 85% aboriginal employment in large mine construction, remediation and related projects. AEL also has a partnership with Taiga Environmental Laboratory in Yellowknife to train Northern participants as laboratory technicians. I&D Management Services Ltd., a partnership 100% owned by the Dogrib Nation Trust Co, Yellowknives DetonCho Corporation, Denesoline Corporation of Lutsel Ke and the Kitikmeot Inuit Association, provides over 20% of the labour force at the Diavik Diamond Mine. Nearly one-quarter of I&Ds employees have participated in Diavik training programs. The Tlicho Agreement provides for preferential contracting by the federal and territorial governments to maximize local, regional and northern employment and business opportunities. Denendeh Development Corporation The Denendeh Development Corporation (DDC) was established in 1982 as a not-for-profit corporation owned by the Dene of the Northwest Territories. The DDC is governed by a Board of Directors representing First Nations communities in each of the five Dene regions. Each region has a director, and all directors have an equal vote at Board meetings. DDC works to create long-term economic self-sufficiency for the Dene. The work of DDC is guided by six governing principles: Economic development that does not negatively impact the environment; Integrate and balance activities with the traditional economy and community development; Human resource development as a main requirement for economic self-sufficiency; Participation and accountability (membership involvement in planning and accountability through representation on Boards); Change and flexibility, regular assessment of objectives, directions and activities at all levels to stay current; and Non-competitive alliances with our regional and community-based aboriginalowned businesses.

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Over the years DDC built up a diverse portfolio of investments. In 2000, the chiefs of Denendeh approved a new investment structure that resulted in the creation of Denendeh Investments Limited Partnership (DILP) and its general partner Denendeh Investments Inc. (DII). Profit-focused investments are now held within DILP and managed by DII. Ventures with primarily a social, artistic and cultural focus remain within DDC. DDC was instrumental in founding the Northern Aboriginal Business Association in 2007. DDC has a 50% equal interest in the NWT Metis Dene Development Fund (MDDF). The fund was established in 1991 by the DDC and the NWT Metis Development Corporation, which also owns 50%. The fund provides loans from a $5.8 million portfolio to majority-owned aboriginal businesses. As a commercial lender, the fund has increased Dene access to capital and business expertise. The MDDF was created through an agreement with Industry, Science and Technology Canadas Aboriginal Economic Program. Its original mandate of stimulating the growth and development of aboriginal businesses has since been expanded to include the provision of loans and services to all residents of the NWT. Since MDDFs inception, it has helped develop nearly 200 business loans and currently has more than 50 clients operating in various sectors: oil and gas, tourism, confectionary, well site office and accommodation rentals, heavy equipment, taxis, mining services and municipal services. As a commercial developmental lender, MDDF is a high end risk taker. Loans policy is to lend up to $275,000 per client, with exceptions up to $350,000. The Denendeh Development Corporation provides management services to Denendeh Investments Inc. Denendeh Investments Inc. Denendeh Investments Inc. (DII) has investments in companies engaged in oil and gas drilling, heavy construction, environmental services, communications, power utilities, real estate development and property management. DII intends to be a significant player in the northern economy and to contribute to sustainable economic development in Denendeh. DII is the general partner acting on behalf of the Denendeh Investments Limited Partnership, which owns the investments. These investments tend to focus on basic services which are needed in every community, like digital communications, which bring medical, educational, banking, business, and general interest services into otherwise unserviced communities. DII is also involved in the
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distribution of electrical power to several small and large communities in more than one region. Cleanup of contaminated mine sites is another area of focus of concern in several regions. Still other DII investments are intended to give aboriginal businesses a stake in megaprojects like the construction of the Mackenzie Valley Pipeline or the all-weather highway into Tuktoyaktuk. The DII investment model features multiple partnership arrangements with other Dene partners, including some with Inuvialuit, Nunasi, and Yukon Indian partners that go beyond the borders of the NWT. Several of DIIs ventures involve partnerships, including multiple partnerships, with experienced industry players. Virtually all of DIIs ventures are in areas where sophisticated technical, professional, and managerial expertise is needed, and many of them have significant capital requirements. FIGURE A-4 Denendeh Investments Incorporated Portfolio
Corporation/Services Partners DII Share

Shetah Nabors Limited Partnership Operates 4 drill rigs and 4 service rigs Broadband Business Alliance LP/Falcon Communications GP Ltd

Shetah Drilling LP and Nabors Canada

51%

BBALP contracted SSI Micro to install high speed broadband wireless service to NWT communities Northern Aboriginal Services Company(NASCo)

DILP, Tetllit Gwichin Council, Deline Land Corporation, Deh Cho Economic Corporation, Tlicho Investment Corporation, and Akaitcho Regional Investment Corporation Falcon Communications Group Ltd (general partner responsible for operations)

16.6% of Falcon Communications Group

Ardicom Digital Communications install and maintain digital communications network in NWT and Nunavut NASCo-ATCO Frontec Joint Venture Maintenance of Northwestel microwave sites Northern Utilities Enterprises Ltd (NUEL)

DILP, Yukon Indian Development Corporation, Inuvialuit Development Corporation, and Nunasi Corporation Northwestel Arctic Cooperatives Limited

25%

33.3%

NASCo & ATCO Frontec Services Ltd

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Electrical power supply and distribution Aboriginal Contractors Corporation (ACC) Majority owner of Mackenzie Aboriginal Corporation (MAC) Mackenzie Aboriginal Corporation (MAC)formed to build Mackenzie Valley Pipeline Scoping study for highway construction Wrigley-Tuktoyaktuk Mackenzie Environmental Solutions Inc Prevent, remediate, clean up environmental contaminants Denendeh Manor LP Corporate office and apartments

ATCO Electric Arctic Energy Investors

14%

Gwichin Development Corp Flint Energy Services, Kiewit, Ledcor, North American Construction Group

33.3%

Exclusive distribution and sales agreement for electrochemical technologies in western Canada with ENPAR Technologies Inc DII on behalf of DILP

51%

100%

Dehcho Economic Corporation The Dehcho Economic Corporation (DEC) is a partnership between the Dehcho First nation communities, with representation from Dene and Metis. Each community appoints a representative, and those with Metis Locals decide upon one for both shareholders. Each community and Metis Local holds 10 equal shares. The DEC board of directors has a chairperson, vice-chair and secretary treasurer, and five directors. The DEC receives its mandate directly from the Dehcho First Nations General Assembly. Reports are provided twice a year, once at the winter leadership meeting and directly to the General Assembly every summer. The Dehcho Economic Corporation has three roles: Business Development: Strategic investment in large-scale, large capital projects that may mobilize several communities to benefit from business opportunities. Partnering with Communities: Assist smaller communities, limited in their funding, human resources and markets, with business development. Natural Resources Development: Support communities negotiating business development opportunities under Impact Benefit Agreements.
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Through the Board of Directors, DEC provides advice to the Dehcho First Nations on resource development and business opportunities that may be of benefit to the Dehcho region as a whole. Over the past few years, the DECs focus has been on pursuing business opportunities, providing advisory services to Dehcho First Nations, and training and educational tools to the member communities. The economic development model of the Dehcho Economic Corporation takes into account the fact that several of the Dehcho communities are small and isolated, with limited capacity and capital of their own. Participation in the Broadband Business Alliance Limited Partnership, which brought high speed Internet service to NWT communities, was a sound strategic decision by the DEC. The emphasis on advisory services, support for communities negotiating impact benefit agreements, and training and education are also important elements of this model. FIGURE A-5 Dehcho Economic Corporation Main Holdings
Corporation/Services Partners DEC Share

Ekelu Engineering Surveying, GIS, and engineering Broadband Business Alliance Limited Partnership BBALP and vendor SSI Micro brought high speed broadband service to all unserved communities in the NWT

Stewart Weir

51%

Denendeh Investments Inc. Akaitcho Regional Investment Corporation. Falcon Communications GP Ltd. was created by the BBALP as its General Partner (Management) to work with SSI Micro on the ongoing provision of new services.

16.6%

Akaitcho Regional Investment Corporation

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The Akaitcho Regional Investment Corporation is the economic development arm of the Dene communities of the Akaitcho Territory. The Investment Corporation is one of the owners of the Broadband Business Alliance, along with six other investment corporations. Operated by Falcon Communications Group Ltd., this service provides broadband wireless Internet connections in remote communities. The Akaitcho Regional Investment Corporation is a signatory to a Memorandum of Understanding with the NWT Energy Corporation (2003) Ltd. (a subsidiary of the NWT Power Corporation), and the South Slave Metis Economic Corporation, to study the potential for hydro development of the Taltson River. If shown to be feasible, hydro-electric power would be supplied to existing and future mines in the NWT. Akaitcho Energy Corporation The Akaitcho Energy Corporation (AEC), originally part of the Akaitcho Regional Investment Corporation, is the energy development arm representing the six Akaitcho communities. AEC is one-third owner of Deze Energy Corporation, along with the Metis Energy Company Ltd. (MEC), a wholly owned subsidiary of the NWT Metis Nation, and the NWT Energy Corporation (2003) Ltd. (NTEC03). The rationale for this venture is that hydroelectricity is the key to the economic future of the NWT. The Deze Energy Corporations proposed Taltson Hydroelectric Expansion Project is designed to offer an ongoing source of clean energy to the Ekati, Diavik, Snap Lake and proposed Gahcho Kue mines. The proponents believe that the project would produce more employment opportunities for Northerners and would significantly reduce greenhouse gas emissions. As well, the revenue from sales of hydro power would benefit all Northerners through shared community and government ownership.

NWT Metis Development Corporation

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The NWT Metis Development Corporation is one of the largest tourism owners in the NWT, with ownership in sizeable operations such as Plummers Fishing Lodges, operator of seven fishing and hunting lodges. The Metis Development Corporation holds 50% of the shares in the NWT Metis Dene Development Fund (MDDF), in equal partnership with the Dene Development Corporation. The fund provides loans from a $5.8 million portfolio to majority-owned aboriginal businesses. As a commercial lender, the fund has increased Dene access to capital and business expertise. The MDDF was created through an agreement with Industry, Science and Technology Canadas Aboriginal Economic Program. Its original mandate of stimulating the growth and development of aboriginal businesses has since been expanded to include the provision of loans and services to all residents of the NWT. Since MDDFs inception, it has helped develop nearly 200 business loans and currently has more than 50 clients operating in various sectors: oil and gas, tourism, confectionary, well site office and accommodation rentals, heavy equipment, taxis, mining services and municipal services. As a commercial developmental lender, MDDF is a high end risk taker. Loans policy is to lend up to $275,000 per client, with exceptions up to $350,000. North Slave Metis Alliance The North Slave Metis Alliance, formed in 1996, is a non-profit organization whose central mandate is to represent the interests of the direct descendants of the Metis of the North Slave Region. Its objectives include: To negotiate and implement a land and resources agreement founded on the principles of self-government; and To promote the educational, economic, social and cultural development of the members of the North Slave Region and Treaty 11 Area.

METCOR Inc. is the economic development arm of the North Slave Metis Alliance (NSMA). It was formed to create business and employment opportunities for the Metis of the North Slave Region. METCORs business strategy is to seek joint venture partnerships with reputable companies that seek to expand their operations within the North Slave Region. These joint ventures, and other associated companies METCOR owns and/or operates, form the basis of METCORs subsidiary companies. The METCOR companies provide a
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range of services to the mining industry, creating direct and indirect employment and contracting opportunities for members of the NSMA. Metcon Construction represents a model for METCORs operations. Until 2006, METCOR was partnered with Tercon Construction, which provided project management for mining projects awarded to Metcon Construction. Tercon had 25 years of experience providing rock and earth excavation for the international mining industry. Tercon also provided skills training to ensure that local residents benefited from these contracts with economic and employment opportunities. METCOR repurchased Tercon Constructions shares in 2006, and now seeks other northern partners in a northern-owned consortium to provide construction services for the northern mining industry. FIGURE A-6 METCOR Inc.s Main Holdings
Corporation/Services Partners METCOR Share

Metcon Construction Ltd Civil construction, piping installation, earth moving, Metcrete Services Ltd Shotcrete, concrete and grouting equipment and services for the NWT diamond mining industry NSM Diamonds Inc Inactive NSM Industrial Services Ltd Environmental remediation and site reclamation Sodexho Alliance Industrial janitorial services, catering, and laundry services Ekati Diamond Mine and Stanton Hospital

Seeking northern partners (Former partner Tercon Contractors) Multicrete Systems Inc

100%

51% Multicrete 49%

Seeking partners 100%

51% Sodexho 49%

Metcrete Services Ltd.s partner, Multicrete Systems Inc. of Winnipeg, provides training services. Metcrete Services provides Certified Nozzleman training for its employees and builds northern capacity by having a locally based production facility. The economic development strategy of the North Slave Metis Alliance and METCOR Inc. is tied primarily to the mining industry of the Northwest Territories. The NSMA has
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participation and environmental agreements with Diavik Diamond Mine and BHP Billitons Ekati Mine, and sits on Diavik advisory boards. Sahtu Region The Sahtu Dene and Metis voted to approve the Sahtu Dene and Metis Comprehensive Land Claim Agreement in 1993. Parliament then approved the Sahtu Dene and Metis Land Claim Settlement Act the following year. Under the Agreement, the Sahtu Dene and Metis received title to 41,437 square kilometers of land in the NWT, including subsurface rights on 1,813 square kilometers of this land. The Sahtu received financial payments totaling $130 million over fifteen years, less $10.8 million in negotiation loans repayments, and a share of resource royalties paid to governments each year in the Mackenzie Valley. There are approximately 3,000 beneficiaries in the five Sahtu communities. One of the objectives of the Land Claims Agreement is to encourage the self-sufficiency of the Sahtu Dene and Metis and to enhance their ability to participate fully in all aspects of the economy. Another was to provide them with specific benefits, including financial compensation, land, and other economic benefits. The Sahtu Secretariat Inc. (SSI) is the coordinating body for seven Land Corporations in the five Sahtu communities. It functions as a point of contact for all government agencies and departments on issues such as education, health, the environment, and economic development. The Secretariats mandate is to ensure implementation of programs and services under the land claims agreement for the benefit of the Sahtu people. SSI does not own land. Title to all lands outside of municipalities is vested in the four Dene and three Metis land corporations within the three districts of Deline, Tulita and Kashsho Gotine. Chapter 12 of the Land Claim Agreement speaks to the implementation of economic measures. A memorandum of understanding with the GNWT for the period 2007-2012 establishes a process for improving the participation of Sahtu beneficiary-owned businesses in GNWT contracting within the Sahtu Settlement Area. The desired outcome is for registered Sahtu businesses to be awarded 50% of GNWT contracting by value within the SSA. Chapter 12 focuses on government economic development programs in the settlement area, to ensure that they take into account the following objectives:
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That the traditional economy should be maintained and strengthened; and That the participants should be economically self-sufficient.

In support of the second objective, government undertakes to: Assist in the development of commercially viable businesses and enterprises, and, when necessary, identify possible sources of financial assistance; Provide business and economic training and educational assistance to participants so that they may be able to participate more effectively in the northern economy; and Encourage employment of participants in the settlement area, including employment in major projects, in the public service and in public agencies. This requires government to prepare plans for training and employment, recognizing the special need of participants for pre-employment training in basic skills. Government is to review job qualifications and recruitment procedures to remove inappropriate requirements in respect of cultural factors, experience, or education. Chapter 12 commits the federal and territorial governments to maximize local and regional employment and business opportunities. This effort involves providing opportunities for potential contractors to become familiar with federal government bidding systems and to take advantage of GNWT preferential contracting policies. Since 2002, the Sahtu Dene and Metis of Tulita have been negotiating with the GNWT and the federal government for a self-government agreement for Tulita, as represented by the Tulita Yamoria Community Secretariat. The Tulita Self-Government Framework Agreement was signed in 2005, and negotiations have since proceeded towards an agreement-inprinciple. Economic Development in the Sahtu Settlement Area Responsibility for business development in the Sahtu communities is held at the community level, through the respective land and investment corporations. With oil and gas exploration active in the region in past years, and the possibility that the Mackenzie Valley Pipeline will eventually be constructed, Tulita Land and Financial Corporation, through its wholly owned subsidiary MacKay Range Development Corporation, has placed a heavy emphasis on training for oil and gas related jobs, training nearly 50 beneficiaries at a time, and working with companies such as Kenn Borek Air and Shetah Drilling to provide employment opportunities for beneficiaries.
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Fort Good Hope, Colville Lake, and Norman Wells also participate in the exploration sector through partnerships with helicopter companies. Construction of the Mackenzie Valley Pipeline would also spur the Mackenzie Valley Highway Extension project, offering potential for highway construction contracts in the region. FIGURE A-7 Sahtu Region Main Holdings by Community Community Land & Financial Corporations
Colville Lake Ayoni Keh Land Corporation Deline Deline Land Corporation

Subsidiaries/Activities
Behdzi Ahda First Nation Economic Trust

Products & Services

Joint venture partner in Kahsho Gotine Helicopters Ltd. Grey Goose Lodge, Great Bear Lake Outfitters Ltd., 984252 NWT Ltd. Research into Bear River hydro development (with Sahdae Energy Limited and Tulita Yamoria Community Secretariat) Residential properties, 2 garages and office building. Joint venture with Great Slave Helicopters, Northwright Airways and EBA Engineering. Joint venture partner with Great Slave Helicopters and Behdzi Ahda First Nation Economic Trust

Fort Good Hope Yamoga Land Corporation

NeRahten Development Ltd.

Yamoga Energy Services

Fort Good Hope Metis Local #54 Land Corporation Norman Wells Ernie McDonald Land Corpn Norman Wells Claimant Corporation

Real property development Service contracts Joint ventures (Akita/Sahtu Drilling)

Tulita Tulita Land and Financial Corporation Fort Norman Metis Land Corporation

MacKay Range Corporation

Offices, RCMP building, residential Fire Management (GNWT), marine contract (Imperial Oil) Canadian Helicopters Sahtu Oil Incorporated EBA Engineering Consultants MOU Joint venture partner in Sahtu Helicopters with Great Slave Helicopters. Equipment leases for oil and gas exploration companies.

The Tulita District Lands Corporations (Tulita Land Corporation, Fort Norman Metis Land Corporation and Norman Wells Land Corporation) in 2010 reached an agreement with

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Selwyn Resources Ltd. to participate in the exploration and development of Selwyn Chihong Minings lead-zinc project at Howards Pass, spanning the NWT/Yukon border. The Deline Land Corporation had earlier (2008) agreed to allow Solitaire Minerals Corp. to proceed with its drill permitting process in the Great Bear region. The potential for hydroelectric development is also substantial in the Sahtu. Deline has done work on a mini-hydro project on the Bear River, and Tulita has also taken steps to undertake hydrology studies on the Willow River to determine its feasibility for a small hydro project. Other communities want to explore the potential for similar small hydro development or other alternatives to diesel power generation, including solar or wind energy projects. The Norman Wells Claimant Corporation is the business arm of the Norman Wells Land Corporation. The NWCC represents the Land Corporations regional and territorial business interests. Its economic activities are focused on real estate, service contracts with government, and industrial joint ventures. The Norman Wells Land Corporation is the Board for the Norman Wells Financial Corporation and the Norman Wells Claimant Corporation. Board members, including the president and vice-president, are elected by the Land Claim beneficiaries and the board appoints the other officers.

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Nunasi Corporation Nunasi Corporation pre-dates the settlement of the Nunavut Land Claims Agreement in 1993. Back in 1976, the Inuit Tapiriit of Canada, now known as the Inuit Tapiriit Kanatami or ITK, created the Inuit Development Corporation as the development arm of the yet to be formed territory of Nunavut. ITK also formed an organization called the Tunngavik Federation of Nunavut (TFN) to negotiate the land claim agreement. Shortly after that, TFN renamed the Inuit Development Corporation Nunasi Corporation. Nunasis purpose was to support Inuit to take a prominent place in the world of Canadian business. Originally, Nunasi Corporation was financed through debt financing secured through the land claim. In 1985, Nunasi Corporation and the Inuvialuit Development Corporation (IDC) purchased the Northern Transportation Company Limited (NTCL). This acquisition set the stage for Nunasis future growth. The Nunasi Board and Executive subsequently established relationships with the three Regional Inuit Associations to work together to benefit all shareholders. In 1992 Nunasi repaid all the monies it had borrowed through the Nunavut Land Claim. The Nunavut Land Claims Agreement, also referred to as the Nunavut Final Agreement, was signed in May of 1993 by representatives of the Tunngavik Federation of Nunavut, the Government of Canada and the Government of the Northwest Territories. It involves the largest number of claimants and the largest geographic area of any comprehensive claim in Canadian history. There are more than 25,000 Inuit beneficiaries in the Nunavut Settlement Area (NSA). This area represents approximately one-fifth the land mass of Canada, as well as adjacent offshore areas. The Agreement provides the Inuit of the NSA with title to approximately 350,000 square kilometers of land, of which 35,257 square kilometers includes mineral rights. Other benefits included the establishment of the Nunavut territory and government. Payment of the Capital Transfer from the Government of Canada to the Nunavut Trust was made in 14 annual payments for a total of $1.173 billion, less repayment of negotiation loans of $39.7 million by TFN. The final payment was made in 2007.
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Structure and Holdings Nunasi Corporation is a birthright development company, wholly owned by the Inuit of Nunavut through Nunavut Tunngavik Incorporated. A Board of Trustees oversees the Board of Directors. The Trustees reflect broad representation from the Regional Inuit Associations, their development corporations, NTI, and Nunasi. As a development corporation, Nunasi aims not only to earn profits for shareholders but also to enter into business ventures that will directly benefit beneficiaries. These benefits include career and employment advantages as well as education and quality of life opportunities. Nunasi operates from offices in Iqaluit and Yellowknife. The Corporation has wholly owned subsidiaries and participates in a large number of varied joint venture partnerships. Nunasis major joint venture, NorTerra Corporation, is an equal partnership between Nunasi and the Inuvialuit Development Corporation. Aboriginal development corporations across northern Canada participate in joint ventures with Nunasi where they have regional importance or national scope. The investment arms of these regional bodies, including the three Regional Inuit Associations of Nunavut, often have extensive investments of their own. The result is a complex web of holdings and relationships. Joint venture activities range from providing essential local services to participation in regional megaprojects, installation and operation of pan-northern telecommunications infrastructure, management of services like the North Warning System on behalf of the Government of Canada and the United States Air Force, participation in a global diamond courier enterprise, or support to the Atlantic offshore oil industry. By recent count, Nunasis wholly owned subsidiaries included seven companies operating retail, helicopter, education and training, and security and related services. Its joint ventures involve companies and groups of companies, some of which operate their own subsidiaries44 companies in allfor a grand total of 53 subsidiaries on the Nunasi organization chart. These joint ventures include: logistical, construction and mining services; fuel distribution; medical boarding homes in Ottawa, Winnipeg, Edmonton and Yellowknife; engineering design and environmental cleanup; winter road construction; expediting; pharmacy; travel agency; hardware and building supplies and sealift operations; remote site microwave maintenance; digital network service; residential and commercial properties; insurance services; electrical estimating and project management; heavy industrial manufacturing; transportation and other ventures.
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FIGURE A-8 Nunasi Corporation Main Holdings

Nunasi Corporation Wholly Owned Subsidiaries

Company Arctic Spirit Promotions Polar Vision Centres Ltd. Nunasi Helicopters Inc. Northern Learning Institute (NWT) Inc. Academy of Learning Genesis Group SecureCheck Products & Services Promotional garments and items, logo embroidery Two optical dispensaries in Yellowknife and Iqaluit for prescription glasses, contact lenses, and sunglasses. Supplies Nunavut communities and Yellowknife. Charter helicopter service to mining and oil and gas exploration, land and wildlife surveys in Nunavut & NWT Education and training services, human resources, career development, media and communications Franchise operation offering computer, office, business, bookkeeping, information technology, and custom designed courses Education and human resource consulting services in NWT and Nunavut. Web development and graphic design. Conference and training centre in Yellowknife. Full service security firm supplying contract personnel, consulting, risk assessment, training and investigation and pre-employment screening services

Nunasi Corporation Joint Ventures

Company Nuna Logistics Products & Services Logistical, construction and mining services: prestrip & open pit mining, site & exploration services, infrastructure planning, runway & all-weather road & winter road construction, crushing, dispatching, heavy equipment operator simulation training etc. Joint venture agreement with Qikiqtaaluk Corporation Joint venture between Nunavut Petroleum Corporation and ATCO Frontec operating under Nunavut Government contract to lease and operate the bulk fuel storage facility and pipeline distribution system in Iqaluit. Medical transportation services and boarding home in Ottawa in partnership with Qikiqtaaluk Corporation Larga Kivalliq Inc. is an equal joint partnership which owns 51% of Kivalliq Development (KDC). KDC operates the Kivalliq Inuit Centre medical boarding home in Winnipeg. Nunasi/Kitikmeot Corporation/Gwichin Development Corporation joint venture operates medical transportation and boarding home service in Edmonton. Medical boarding home in Yellowknife for residents of the Kitikmeot region. Partnership Page 62 of 83 Nunasi Share 51% (with Kitikmeot Corporation) Partners 49% Nuna Logistics Mgt Group

Nunavut Petroleum Corporation Uqsuk Corporation

51%

49%

Larga Baffin

50%

50%

Larga Kivalliq Inc./ Kivalliq Development Corporation Larga Ltd.

50%

50% Sakku Investments Corp. 37.5% GDC 25% KC

37.5%

Larga Kitikmeot

50%

50% KC

Sahtu Project

Kitnuna Corporation

Kitnuna Expediting Services Kitnuna Projects

Fuel distribution, expediting, maintenance contracts, environmental cleanup, and winter road construction(four Kitnuna companies) Expediting and remote camp support Multi-disciplinary project management and construction company with focus on environmental cleanup and infrastructure projects Fuel storage and distribution in Cambridge Bay Joint venture between Kitnuna Corporation and Super Thrifty Pharmacy. Retail and prescription services in Cambridge Bay to the Kitikmeot Region. Joint venture with TC Enterprises. Owns Bartesco Apartment Building in Yellowknife. Full service travel and tour agency with offices in Yellowknife and Iqaluit. Northern Tours division promotes travel in Nunavut and NWT. Hardware and building materials supplier in Iqaluit, with packaging and marshalling connections in Valleyfield, QC, during sealift season. Ownership is shared with the Denendeh, Yukon Indian, and Inuvialuit development corporations (DDC, YIDC, and IDC). Provides maintenance at 160 remote microwave sites for Northwestel through the NASCO-Frontec joint venture. Operates a digital wide area network (WAN) serving 58 communities across the North on contract to the GNWT and Nunavut, and provides similar services to other pan-northern customers. Holding company for NCC Development, NCC Residential Properties, and NCC Commercial Properties. Develops, owns and leases infrastructure requirements in Nunavut on contract with the federal government. 100% Inuit joint venture with Qikiqtaaluk Corp (QC), Sakku Investments (SIC), Inuvialuit (IDC), Makivik Corp (MC), and Labrador Inuit (LIDC). PAIL and ATCO Frontec have 50/50 joint venture to operate and maintain the North Warning System through their agent, Nasittuq Corporation. Agent for PAIL/ATCO Frontec joint venture to operate and maintain the North Warning System in Canada on behalf of the Department. of National Defence and US Air Force. Secure international courier and specialized transportation and logistics service, armoured car and airfreight services.

50%

50% KC

Kitnuna Petroleum Ltd. Kitnuna Pharmacy Ltd.

Not reported 50% 55%

Not reported

Numac Development Ltd Top of the World Travel

50% TC Enterprises 45% KC and individuals Not reported

Frobuild (2006) Ltd.

Not reported

Northern Aboriginal Services Company (NASCO)

25%

25% DDC 25% YIDC 25% IDC

Ardicom Digital Communications Inc.

33.3%

NCC Investment Group Inc.

25%

Pan Arctic Inuit Logistics (PAIL)

15%

33.3% Northwestel 33.3% Arctic Coops 25% each Sakku IC, Kitikmeot Corp, Qikiqtaaluk Corp. 85% other Inuit heritage development corporations 50% ATCO Frontec

Nasittuq Corporation

50% PAIL

Malca-Amit (NWT) Ltd.

51% SecureCheck

49% MalcaAmit New York Inc.

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Nunavut Insurance Brokers Ltd.

Ryfan Nunavut Inc.

M&T Enterprises Ltd.

IEG Nunasi Consultants Ltd.

Personal home, auto, business and life insurance and specialized corporate insurance services, with offices in Iqaluit, Rankin Inlet and Winnipeg. Nunasi, Sakku Investments, and Kitikmeot Corp are equal one-third owners in 6130518 Canada Corporation, which owns 60% of NIB in partnership with Leipsic Insurance (40%) Industrial mechanical and electrical contracting in the Kitikmeot region. Involved in Hope Bay mining project. Provides training, skill development and employment opportunities. Joint partnership between Nunasi, Kitikmeot Corporation and Ryfan Electric of Yellowknife. Freight and fuel delivery, household moving, expediting and ground transportation, and construction services in Rankin Inlet. Ownership includes a private individual. Engineering and environmental services, site reclamation and environmental management in Rankin Inlet

33.3%

33.3% Sakku Investments 33.3% Kitikmeot Corporation

Not reported

Not reported

33.3%

51%

33.3% Sakku Investments 33.3% Peter Tatti 49% Klohn Crippen Berger Ltd.

NorTerra Group of Companies

NorTerrra Inc. Investment-focused management and holding company owned equally by Nunasi and the Inuvialuit Development Corporation. National air carrier serving northern and southern Canada. 100% NorTerra ownership. Major pan-arctic marine operator delivering dry cargo and fuel from BC, Montreal, Hay River and Churchill to communities and remote sites. Provides supply services to Atlantic offshore petroleum industry from Halifax. Industrial products supplier to the mining, forestry, oil and gas industries, government, and communities from 11 branches in NWT (2), Yukon (3), BC (4) and Alberta (2). Expediting and project logistics, freight forwarding and air cargo handling etc. in NWT, Nunavut, Edmonton, Calgary, Winnipeg and Ottawa. Three business units in Alberta, BC, Ontario and Washington State: Weldco-Beales Manufacturing designs and manufactures heavy equipment attachments. Weldco-Hydra-Lift designs and manufactures truck-mounted telescopic cranes. Weldco Heavy Industries based in the Alberta tar sands specializes in steel fabrication and repairs in the mining industry. 50% 50% IDC

Canadian North Northern Transportation Company Limited (NTCL)

100% 100%

Northern Industrial Sales

100%

Braden Burry Expediting Weldco Companies

100%

100%

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Norterra Group of Companies, owned equally by Nunasi and IDC, is a private, investmentfocused management and holding company. NorTerras group of companies includes Canadian North, NTCL, Northern Industrial Sales, Braden Burry Expediting, and the four Weldco companies, involved in industrial manufacturing at locations across Canada and in Washington State. Besides partnerships with the Regional Inuit Associations and the Inuvialuit Development Corporation, Nunasi also partners with the Gwichin Development Corporation, the Denendeh Development Corporation, the Yukon Indian Development Corporation, Makivik Corporation, Sakku Investment Corporation in the Kivalliq Region, and the Labrador Inuit Development Corporation. In fiscal year 2009, the Inuit Trust reported investment income of $38.8 million and a distribution to beneficiaries of $33.6 million on investment assets totaling $1.115 billion. The Inuit Trust also declared dividends of approximately $463,000. The distribution and dividend are paid to the three Regional Inuit AssociationsQikiqtani Inuit Association, Kitikmeot Inuit Association, and Kivalliq Inuit Association. By that same year, Nunasi Corporation had declared dividends since 1999 of over $3 million. Spinoff Benefits Nunavut Tunngavik Incorporated disbursed $2.4 million in 2009 to approximately 1,400 beneficiaries through the Nunavut Elders Benefit Plan. The Bereavement Travel Program and Compassionate Travel Program disbursed $500,000 to approximately 500 beneficiaries from 200 families. A further $40,000 was paid to 13 groups, numbering 200 beneficiaries, through the Nunatiqaminut Travel Program for travel to ancestral lands. Nunasi Corporation subsidiaries make charitable donations directly to selected causes. In Yellowknife, for example, SecureCheck has made substantial donations to NWT Crimestoppers (over $7,500 to date), the Side Door Youth Centre (over $8,000 in furnishings), Stanton Territorial Hospital Foundation ($20,000), Facilities for Kids ($10,000), Yellowknife Food Bank ($5,000 and food), Salvation Army Adopt a Family Christmas Program (20 families plus new toys collected), and the NWT Council of Persons with Disabilities (security services for a Celebrity Auction). Training, skill development and employment are key objectives of Nunasis activities. For example, the founding principles of Ryfan Nunavut Inc. include: creating more training
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opportunities and safe, meaningful jobs for northerners, including Inuit youth of the Kitikmeot region. Locally based enterprises offer convenient access to goods and services not only in the community but also throughout a region. The Kitnuna Pharmacy in Cambridge Bay, opened in 2006, fills prescriptions for residents throughout the Kitikmeot Region as well as locally. This business was also founded with the objective of expanding its services to include such things as diabetes education clinics, translated prescription information and other diagnostic services, and health-related appliances such as walkers, wheel chairs and therapeutic beds. Ongoing financial success will make these objectives achievable. In addition to Nunasi each of the three Regional Inuit Organizations under the Nunavut Land Claim have their own economic development corporations: the Kitikmeot Corporation, Sakku Investments Corp. and Qikiqtaaluk Corporation which in total have a group of companies with revenues that approach Nunasis revenues. James Bay and Northern Quebec Agreement (1975/1978) The James Bay and Northern Quebec Agreement of 1975 was the first major agreement between Canada and its native people since the numbered treaties of the 19th and early 20th centuries. The Agreement was forged out of the opposition of the Cree and Inuit of the region to the James Bay hydro megaproject, and from the failure of the Government of Quebec to protect their rights as required by the Quebec Boundaries Extension Act of 1912. Three years later the Naskapi of Schefferville signed a parallel agreement, the Northeastern Quebec Agreement, thereby amending and joining the JBNQA. The JBNQA and the NEQA are the first comprehensive land claim agreements signed in modern times in Canada. The territory covered by the two agreements comprises more than 1,000,000 square kilometers in three categories of land. Compensation of $225 million (only part of it from the Government of Canada), and an additional $9 million to the Naskapi, was paid out over 25 years to three organizationsthe Cree Board of Compensation, the Makivik Corporation, and the Naskapi Development Corporation. Approximately 16,000 Crees and more than 10,000 Inuit are beneficiaries. The James Bay Agreement established many of the elements and key principles found in the more recent land claim agreements. The Agreement changed the role of the federal
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government in Northern Quebec, shifting its responsibility from providing services to subsidizing their administration by Native local governments and the province of Quebec. Section 28 of the Agreement speaks to the economic and social development of the Crees. It established the James Bay Native Development Corporation to receive capital transfers. The four objects of the Development Corporation are to: Assist, promote and encourage the creation, diversification or development of businesses, resources, properties and industries, in order to stimulate maximum economic development opportunities for Cree people and contribute to their general well-being; Assess the potential contribution of the Corporation to the economic development of the Cree people and establish priorities for appropriate development measures and projects; Invest in projects; and Promote greater cooperation for development in the Territory.

Reference was made to support for specific categories of economic activity: the traditional and local service economies; forestry, mining, and other industrial projects; construction; transportation; and other ventures deemed appropriate by the Development Corporation. Associations were created to support trapping, outfitting and tourism, and native arts and crafts. The associations were to provide training, development, and marketing programs and other professional services on behalf of these sectors. Other subsections relevant to economic development deal with: Training Courses, Job Recruitment and Placement; Cree Participation in Employment and Contract (speaks to job training within the public service and preferential contracting practices for projects on Cree lands); and Assistance to Cree Entrepreneurs (speaks to measures Canada and Quebec will take to assist Cree individuals or groups to establish, own, operate, expand or modernize business enterprises). A later Contracting Policy Notice from the Treasury Board lays out specific contracting practices found in recent land claim agreements. Section 29 of the Agreement deals with Inuit economic and social development. Its provisions speak more directly than Section 28 to support for the subsistence hunting, fishing, and trapping economy, including training and development programs. Section 29 also refers at length to the need for vocational, administrative, and management training to
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prepare Inuit for positions in their communities and for placement and promotion within the public service. Canada and Quebec also made commitments to support Inuit entrepreneurs with technical and professional advice and financial assistance.

Makivik Corporation Makivik (To rise up in Inuktitut) Corporation was mandated to protect the rights, interests and financial compensation provided by the James Bay and Northern Quebec Agreement in 1975 and the Nunavik Inuit Land Claim Agreement of 2007. The Corporations distinct mandates range from owning and operating large profitable business enterprises and generating jobs, to social economic development, improved housing conditions, to protection of the Inuit language and culture and the natural environment. Makivik Corporation is a non-profit entity. It receives, administers, distributes and invests the compensation money payable to Nunavik Inuit. The initial $90 million paid out under the compensation package more than doubled over 30 years. Makivik has also started to receive the $86 million capital transfers and associated funds due under the Nunavik Inuit Land Claim Agreement to create the new Nunavik public government, while $55 million will fund the Nunavik Inuit Trust to make disbursements to individual Nunavik Inuit. An internal Investment Review Committee (IRC) is responsible for ensuring that the capital fund grows over time for use by future generations. The IRC is an advisory group to the Makivik executive which administers and invests the capital fund in stocks, bonds and money markets; reviews joint venture projects or proposals including the creation of new subsidiary companies and loan request applications; and recommends the annual budget to the Makivik directors based on the projected rate of return from financial investments. The IRC meets monthly while an investment group monitors the fund and tracks investment activities daily. A core element in Makiviks mandate is economic development and job creation. It recognizes first and foremost the economic future of Nunavik will continue to depend on renewable and non-renewable natural resources. Each of Makiviks subsidiary companies has its own corporate leadership and board of directors charged with running profitable ventures. Its subsidiaries fall into two categories: wholly owned and joint ventures.
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FIGURE A-9 Makivik Corporation Main Holdings Makivik Corporation Wholly Owned Subsidiaries
Company First Air Products & Services Largest air carrier serving the eastern and western arctic, with bases in Ottawa, Montreal, Edmonton and Yellowknife. Employs more than 1,000 people. Daily passenger and freight service in Nunavik, with bases or agents in all 14 Nunavik communities. Employs over 300 people. Sealskin clothing and down-filled parkas. Provides opportunities to beneficiaries to sell their garments and art. Has a growing Internet business. Employs seamstresses and support staff. A series of tanning training programs in the communities in 2003-2004 to encourage small enterprises in tanning and taxidermy has evolved into a tanning facility in Kuujjuaq that processes furs from the region. Fuel services, garage, heavy equipment rentals, and rock crushing facility producing high quality gravel, servicing local needs in Kuujjuaq. Created in 2005 to research, develop, and market three resource groups: seaweed for anti-viral and anti-bacterial medical properties and cosmetics; shrimp byproducts (waste) which contain Omega-3 fatty acids; and several medicinal plants in the region which are under way to be commercialized over the next few years.

Air Inuit

Nunavik Creations

Nunavik Furs

Halutik Enterprises

Nunavik Biosciences Incorporated

Makivik Corporation Joint Ventures

Company Cruise North Expeditions Products & Services Adventure cruises from St. Johns to northern communities and remote locations. 6-8 10-day tours a year, up to 600 passengers. Runs Inuit Youth on Board Trainee Program and the Arctic Clean-Up Mission. Marine transportation serving communities, outpost camps, and mining operations. Equal partnership with Qikiqtaaluk Corporation and Sakku Investments in Nunavut Umiaq Corporation (NUC). Shares shrimp fishery licence with Qikiqtaaluk Corp. Full owner of a licence operated in partnership with Newfoundland Resources Ltd. Trains Inuit crews. Operates North Warning Defense System under contract to the Department of National Defence. 1 of 7 aboriginal partners Makivik Share 100% Partners Coordinated with First Air

Nunavut Eastern Arctic Shipping (NEAS)

NUC 51%

49% Transport Nanuk (Northwest Company & Logistic Corp.) Qikiqtaaluk Corporation Newfoundland Resources Ltd. ATCO Frontec and Nasittuq Corporation

Unaaq Fisheries

Pan Arctic Inuit Logistics

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James Bay Crees The Grand Council of the Crees represents approximately 14,000 Crees of eastern James Bay and southern Hudson Bay in Northern Quebec. The Cree Regional Authority is the administrative arm of the Cree government. The two organizations have identical membership, board of directors and governing structures, and are in effect managed and operated as one organization by the Cree Nation. Both corporations are non-profit, and both must report annually to the Cree beneficiaries at an annual general assembly. The Department of Traditional Pursuits provides professional advice to the nine Cree communities with respect to planning local projects and environmental protection. It supports sustainable forestry practices, mining, and hydroelectric development. The Community Services Department supports the Cree communities in capital planning, economic development, and training for employment created by development in Cree territory. Five regional entities share responsibility for Cree economic development: The Board of Compensation, which manages funds from the 1975 James Bay Agreement, funds business ventures and manages the regional carrier Air Creebec, Cree Construction, Valpiro (aircraft maintenance and servicing in Montreal), and Cree Energy through CREECO, its holding company. Eeyou Corporation manages funding received under the La Grande 1986 Agreement. It makes investments in community development and economic development ventures. The Cree Development Corporation was set up under the New Agreement with Quebec (2002). It makes investments in economic ventures using the funding from the New Agreement. Cree Human Resources Development Department provides job search services, administers employment insurance, and provides training funding, in part provided by the federal government as a land claim obligation. Training programs support Cree employment in the mining, hydroelectricity, forestry, construction, and tourism sectors.
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The Regional Economic Development Agent for the Cree Regional Authority works in cooperation with the foregoing entities to promote Cree employment, contracting, and new business formation.

The Department of Economic Development is responsible for Cree Regional Economic Enterprises Co. (CREECO). CREECO was created in 1982, three years after the Crees received their first compensation monies paid under the provisions of the James Bay and Northern Quebec Agreement (JBNQA). It serves as a holding company for all Cree-owned enterprises in which compensation monies were invested. Two major companies had already been establishedthe regional carrier Air Creebec and Cree Construction. CREECO was created when these two businesses ran into difficulties. Financial losses in these and other ventures continued to be reported into the 1990s. The mission of CREECO has been described as follows: Aside from the objective of creating wealth, the CREECO companies also have a social mission of partnership with the Cree communities. This involves maximizing native employment in its ranks, and to that extent, CREECO has undertaken training programs in each of its companies. Today, out of a total work force of 525, approximately 30% are native employees. CREECO businesses, Cree communities, and private businesses are engaged in forestry, commercial fishing, mining, construction and general contracting, outfitting and outdoor ventures and other tourism, and commercial and retail operations. The food wholesaling business experienced losses that pulled down the profits made by other companies in the startup phase, due to the inexperience of young staff and early staff turnover. Customer surveys were carried out to develop plans and strategies for improving products and services for customers and clients. The CREECO companies participate in joint ventures to secure contracts in the territory and to ensure transfer of technology. In February 2010, CREECO and five chiefs established Eeyou Power. Eeyou Power began as a working group in 2004, with the goal of developing sustainable energy projects controlled by the Crees. Some of the communities hailed the new venture as a means of preventing Hydro-Quebec from revisiting an old plan to develop the Great Whale project. The door is open for the remaining four Cree communities to sign on. Eeyou Powers goal is to win Hydro-Quebec as a client for sustainable power projects. Eeyou Power had already
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signed a Memorandum of Understanding with the engineering firm Genivar to provide engineering services for any future contracts. Genivar had previously trained Cree beneficiaries hired to work on a mine tailings cleanup contract awarded to Genivar. Yukon Umbrella Final Agreement The Umbrella Final Agreement is a political or policy document between the Governments of Canada and Yukon and the Council of Yukon First Nations representing 14 Yukon First Nations. The Umbrella Final Agreement provides a template for negotiating individual First Nation Final Agreements in the Yukon. On its own, the UFA is not legally enforceable, but all of its provisions are contained in each of the 11 Yukon First Nation Final Agreements concluded to date. Three First Nations have yet to settle their land claims and remain Indian Bands under the Indian Act. In 1991 the first four Final Agreements were reached and work on Self-Government Agreements began. The UFA and the first four Final Agreements and Self-Government Agreements were signed in 1993, and the first four Final Agreements and Self-Government Agreements came into effect in 1995. In total, the 14 First Nations receive 41,595 square kilometers of Settlement Land, divided among them. Settlement parcels are of three types: Rural Lands, Community Lands, and Site Specific Lands. Each First Nation Final Agreement sets out that First Nations share of financial compensation from a total of $242,673,000 (in 1989 dollars, less each First Nations share of negotiation loansapproximately 25% of their total compensation). The total First Nations population of the Yukon was approximately 6,300 as of the 2006 Census. Chapter 22 of the UFA and the Final Agreements sets out the framework for dealing with Economic Development Measures. After the effective date of a YFNFA, the First Nation and Government will develop an economic development opportunity plan and specific economic measures. The economic development opportunity plan will include recommendations to: Increase training opportunities and identify the experience needed to take advantage of economic opportunities generated by the Final Agreement; Increase the use of available financial and technical resources; and
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Identify the funding requirements and measures required to stimulate the community-level economy.

Each YFNFA provides specific economic measures which address: Access to employment and contract opportunities generated from the Final Agreements; Access to employment and contract opportunities generated from the land and resource management regime set out in the UFA; Participation by Yukon First Nations people in harvesting activities; and The interest of Yukon First Nations in strategic investments, including joint capital planning.

Government will help facilitate training and professional development of Yukon First Nations to enhance their access to government employment opportunities, with an emphasis on placing more Yukon Indian people in technical, managerial and professional positions within Government. The Final Agreements commit the Government of Yukon to several measures to support First Nations economic development: Arranging contracts so that Yukon First Nations and their small businesses will be able to take part in competitive bidding on public tenders; Appointing First Nations representatives to the Board of Directors of the Yukon Development Corporation and the Yukon Energy Corporation; Providing for YFN corporations to participate in joint ventures and partnerships with the Yukon Development Corporation (sole shareholder of the Yukon Energy Corporation); Providing for YFN First Nations representatives to sit on the Yukon Council on the Economy and the Environment; and study the feasibility with the Yukon First Nations of establishing a YFN-controlled trust company.

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Labrador Inuit Land Claims Agreement The Labrador Inuit Land Claims Agreement, signed on January 2, 2005, is the first modernday treaty of its kind in Atlantic Canada, and the first Inuit land claim to win the right to self-government. The Parliament of Canada gave Royal Assent to The Labrador Inuit Land Claims Agreement Act on the day of signing, soon after it was ratified by the Government of Newfoundland and Labrador. The LILCA established the Labrador Inuit Settlement Area, totaling approximately 72,500 square kilometers of land in northern Labrador, including 15,800 square kilometers of Inuit-owned lands, known as Labrador Inuit Lands. Labrador Inuit are entitled to 25% of provincial revenues from future development on these lands. The Settlement Area includes an adjacent Ocean Zone of 48,690 square kilometers. The Inuit have co-management rights over the Offshore Zone and the remainder of the Settlement Area, and are entitled to 5% of provincial revenues on the remaining Settlement Area lands. The LILCA also provides for the establishment of the Torngat Mountains National Park Reserve, an area of 9,600 square kilometers. Financial compensation from the Government of Canada will total $140 million (in 1997 dollars), less approximately $50 million in negotiation loan repayments, paid annually over 15 years. Canada will also transfer $156 million for implementation of the Agreement. The regional Nunatsiavut Government is responsible for respecting the Labrador Inuit Constitution and for determining who qualifies for enrolment as a beneficiary under the LILCA. There are approximately 7,000 beneficiaries, most of whom live in six communities. In 2010 amendments to the LILCA came into force. The amendments incorporate an Overlap Agreement between Labrador Inuit and Nunavik Inuit of Quebec. The Agreement resolves overlapping land claims in northern Labrador and offshore areas adjacent to northern Labrador and northern Quebec. Labrador Inuit Development Corporation (LIDC) LIDC is the business and economic development arm of the former Labrador Inuit Association, its management and governance restructured to reflect its new relationship with the Nunatsiavut Government. Over the course of 20 years, LIDC invested in mining, quarry operations, fisheries, radar site operations, logistics support, real estate, and other
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operations. Through partnerships and its own operations, LIDC employed close to 600 people annually, the majority of them Labrador Inuit. The Nunatsiavut Government is continuing to make strategic investments that combine traditional Inuit skills with education and training to meet the needs of the labour market within Nunatsiavut and beyond. The Department of Education and Economic Development is responsible for guiding economic development and new business ventures. The department is also responsible for maximizing Inuit employment in the public service; ensuring Inuit labour market and business participation through Impact and Benefit Agreements; providing access to training, investment, and purchasing programs; and assisting and promoting Labrador Inuit businesses through the Nunatsiavut Business Centre Incorporated, which provides training, loan financing, and advice to Labrador Inuit businesses. The mandate of the LIDC is to improve the living conditions of the Labrador Inuit by providing employment opportunities, with particular focus on traditional Inuit skills, and to promote education and training of Inuit to meet the requirements of the labour market. Natural resources dominate the LIDCs business activities. A joint venture shrimp fishery provides fulltime work for ten employees. Quarrying of Labradorite stone, shipped for processing in Italy, provides seasonal employment and some finishing work on site at Hopedale for the NAFTA area market. Products include blocks and slabs, tiles, countertops, memorials, etchings and landscape architecture. The LIDC participates with other northern development corporations in the operation and maintenance of the North Warning System. This venture provided valuable training opportunities. Twenty-seven Labrador Inuit completed training positions with Pan Arctic Inuit Logistics. As of a recent count, 12 of them remained with PAIL, while the remaining 15 moved into other employment. By far and away the major focus of attention is the Voiseys Bay nickel mine. Torngait Services Inc. (TSI) was incorporated in 1995 as the operating arm of a limited partnership with ATCO Frontec Services Limited to provide logistics and support services to the mining and exploration companies operating in the Central Mineral Belt of Labrador. Particular emphasis was focused on the Voiseys Bay nickel project, owned by Vale Inco NL Limited.
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Torngait Services Inc. provides site services, drilling, and mine/mill engineering services through subcontracts and partnerships. TSI is responsible for the operation of all equipment, performance of general labour duties, and supervision of all employees at the Voiseys Bay site. A recent five-year contract valued at $47.5 million provided employment for 65 employees, of whom 70% are aboriginal. TSI and ATCO Frontec were successful in winning the contract to build the permanent accommodation facility for the Voiseys Bay project, worth $23 million. TSI subcontracted the construction to an ATCO Frontec joint venture with Kent Homes of New Brunswick. TSI is the prime contractor responsible for exploratory diamond drilling at Voiseys Bay, with Boart Longyear as subcontractor. Other projects have included mine reclamation at Saglek. Labrador, where TSI provided a mobile camp, with equipment, personnel and air logistics support. Annual revenue for Torngait Services Inc. is reported to be approximately $12.8 million annually, with a payroll of approximately 76 employees. FIGURE A-10 Labrador Inuit Development Corporation Main Holdings Company
Pikalujak Fisheries Limited (PIK) Pan Arctic Inuit Logistics (PAIL) Torngait Services Inc.

LIDC Share
50% 19%

Partners
50% Ocean Prawns Canada Ltd Other northern development corporations ATCO Frontec and other partners and subcontractors

Products and Services

Shrimp fishery off Labrador employing ten full-time employees Operation and maintenance of the North Warning System. Mining support services. Logistics support. Project management. Engineering, reclamation etc. Owns and leases office space in three Labrador communities ($500K annual sales) Production of Labradorite quarry stone shipped to Italy for processing Markets TUC supplied dimension stones in the NAFTA market area Processes waste stone slabs from the quarry for the furniture market. Employs 8 to 10 workers.

Not reported

Nunak Incorporated

100%

Torngait Ujaganniavingit Corporation (TUC) Tunnet Incorporated Hopedale Stone Processing Plant

100% Majority 100% Partners in Italy and Halifax

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Nunavik Inuit Land Claims Agreement (2006) The Nunavik Inuit Land Claims Agreement addresses the use and ownership of Nunavut land and resources in James Bay, Hudson Bay, Hudson Strait and Ungava Bay, as well as a portion of northern Labrador and an offshore area adjacent to Labrador. The Governments of Canada and Nunavut and Makivik Corporation signed the NILCA in December 2006 and Parliament approved the Nunavut Land Claims Agreement Act in February 2008. Canada will provide a capital transfer of $54.8 million (in 2005 dollars), paid in nine annual installments, less $12 million in negotiation loan repayments. Makivik Corporation represents approximately 10,000 Inuit living in 15 Nunavik communities. The Nunavik Inuit Settlement Area comprises two areas: the Nunavik Marine Region, which covers the Nunavut offshore islands adjacent to Quebec and the intervening waters. It encompasses more than 250,000 square kilometers, has no full-time residents, and is within the jurisdiction of Canada and Nunavut; and the Labrador portion of the Nunavik Inuit Settlement Area, which covers an offshore area adjacent to Labrador and an onshore portion in northern Labrador consistent with the boundaries of the Torngat Mountains National Park of Canada.

The Nunavik Inuit own and have surface and subsurface rights to 80% of the total area of the islands in the Nunavik Marine Region, an expanse of approximately 5,100 square kilometers. An additional area of approximately 400 square kilometers is shared with the Crees of Eeyou Istchee in a shared zone. Nunavik lands will include any mines and minerals found in these islands. The NILCA contains articles that achieve successful overlap agreements between the Nunavik Inuit and the other three aboriginal groups in the regionthe Nunavut Inuit, the Crees of Eeyou Istchee, and the Labrador Inuit. The Agreement gives the Nunavik Inuit clear rights to subsistence and commercial harvesting in the offshore area. The Agreement ensures their access to commercial licenses and quotas for turbot and shrimp in the Davis Strait and Hudson Bay. This represents the major economic achievement of the NILCA. The Agreement also guarantees the Nunavik Inuit a share of federal government resource royalties. It does not provide for self-government, as there are no residents in Nunavik. However, a Nunavik Regional Government is expected to be in place by 2013.
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Innu Nation The Innu people of Labrador joined the Mikmaq and Inuit in 1973 to form the Native Association of Newfoundland and Labrador. The Innu broke away from the NANL three years later to form the Naskapi Montagnais Innu Association, renamed the Innu Nation in 1990. Its role is to continue the effort to protect Innu rights and lands and way of life. Functioning as the governing body for the Innu people, the Innu Nation in 2002 won recognition for the Innu as status Indians under the Indian Act. Currently, the Innu Nation is engaged in land claim and self-government negotiations with the Governments of Canada and Newfoundland and Labrador. The Innu Nation represents about 2,200 Innu, most of whom live in the two communities of Sheshatshiu and Natuashish. Its efforts have been successful in achieving economic concessions from major projects under way or planned in Labrador: The provincial government and Labrador Hydro have both agreed to include the Innu Nation in the development of the Lower Churchill Falls. The three parties are also negotiating a deal that could give the Innu Nation minority ownership of the hydro-electric project. Inco Ltd. agreed to pay the Innu Nation royalties for its mining project at Voiseys Bay. As of 2007, these royalties had reached $4 million. The province developed a Forest Process Agreement with the Innu Nation in 2001 to allow for full Innu participation in forest planning in central Labrador.

Osoyoos Indian Band Development Corporation The Osoyoos Indian Band was formed in 1877 at a time when its members were involved in ranching, trading, and small farming. The bandNKMip in the Okanagan languagehas always been progressive. Its land base consists of 32,000 acres in the lower Okanagan Valley of British Columbia. Today the Osoyoos Indian Band Development Corporation (OIBDC) represents the economic interests of the bands approximately 450 members. The OIBDC operates 11 band-owned businesses with budgets in excess of $17 million, and administers its own health, social, educational and municipal services. The businesses
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serve the band and the region, taking full advantage of the reserves natural potential. The OIBDC has been recognized as an exemplary example of what can be achieved by a small band utilizing the resources of a relatively small land base. OIBDC is owned, operated and governed by the band and has become an effective method of separating business from politics. The reserve lands are situated in a region with potential for residential, commercial, industrial, agricultural, and eco-tourism development. The bands business model includes a mix of local services, regional industrial services, commercial scale agriculture, and yearround recreational, cultural and conference facilities. Local services include a convenience store and gas bar and daycare centre. A construction company and Readi-mix concrete operation serve the community and surrounding region. The climate makes the area suitable for growing grapes, which prompted the band to develop commercial vineyards and the first aboriginal-owned winery. The terrain favours tourism development, leading the band to develop a golf course, ski resort and RV park, businesses that tie in neatly with the winery as part of an integrated $25 million dollar venture, NKMip Resort. The experience of the Osoyoos Indian Band demonstrates that much can be accomplished when all of a Bands resources are put to work. The band now has 1,555 acres planted in grapes, with plans to increase that amount in the near future by 150-200 acres. Twentyfive percent of the total acreage planted in vineyards in the Okanagan Valley is on NKMip land, representing over 20% of BC wine production. Recent expansion of the bands vineyards has been done on a lease basis with other wine makers. The band has the confidence to welcome outside businesses with viable business plans to operate on Nk-Mip land through joint ventures and leases. A cultural centre celebrates NkMip culture and desert lands, providing on-site cultural tours, visitor programs, nature trails, interpretive sites, and gift shop. The Centre promotes family tourism. It is also home to rattlesnake research and tagging related to this endangered desert eco-system. The Band, in association with several universities, has developed a native community business model and training program. Based at the band-owned resort, with courses in Leadership and Entrepreneurship, Sustainable Economic Development, and Governance,
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this model has been recognized internationally for its excellence. The current Chief, Clarence Louie, sits on the Board of Directors of the Denendeh Development Corporation. FIGURE A-11 Osoyoos Indian Band Development Corporation Main Holdings

Corporation NKMip Canyon Desert Golf Course NKMip Construction Ltd. NKMip Vineyards NKMip Gas & Convenience Store NKMip Campground & RV Park

OIBDC Share 100% 100% 100% 100% 100%

Products and Services 18-hole golf course with restaurant seating for 120 and patio seating 70. Home and commercial construction on and off reserve, 4 carpenters and 3 labourers. 1,155 acres operated under long term leases with several wineries. Low priced groceries and healthy steamed food. Gas and commercial key lock. 74 full service year-round sites ad over 120 lakefront sites. 8,020 square foot multi-use clubhouse, marina, horseback riding etc. Cultural tours and visitor programs. Includes rattlesnake tracking and research. North Americas first aboriginal-owned and operated winery, using grapes from 40 acres of NKMip Vineyards. Capacity 18,000 cases. Fully licensed, operates year round 7:30 am to 5:30 pm, all children welcome age 2.5-Gr 1 Batch plant serves South Okanagan. Also aggregate, forms and precast products. 4.5 star all-season resort operates in conjunction with wine tours, golfing, cultural activities and conference centre as part of the $25 million NKMip Resort businesses. Involves the first revenue-sharing framework of its kind in BC for development of Crown lands as part of the expansion of Mt. Baldy. Deal includes free season lift passes for NKMip students and 50% discounts for all other band members and NKMip signage.

NKMip Desert Cultural Centre NKMip Cellars

100% 100%

NKMip Preschool and Daycare Oliver Readi Mix Ltd. Spirit Ridge Vineyard Resort & Spa

100% 100% Lease

Mount Baldy Ski Corporation

2.5%

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Alaska Native Claims Settlement Act The discovery of oil at Prudhoe Bay in 1968 brought to a head the growing demands of Alaska natives to secure legal rights to their traditional lands and hunting grounds. The federal government had placed a freeze on federal land transfers in 1966 pending action by Congress to resolve the claims issue. The land freeze was severely impacting state revenues and threatening construction of the oil pipeline from Prudhoe Bay to Valdez. Wanting a quick settlement, and wanting Alaska natives to become more assimilated into the mainstream, federal administrators and politicians proposed the creation of for-profit native corporations as the way to achieve that quick settlement. Over opposition from Alaska politicians, mining and oil companies and sportsmens groups, the Alaska Native Claims Settlement Act (ANCSA) was signed into law in 1971. ANCSA is the largest land claim ever settled in the United States. It transferred government land title to 12 Alaska Native regional corporations and more than 200 village corporations. A thirteenth regional corporation was created for Alaska natives living outside the state. ANCSA abrogated native claims to aboriginal lands, in return for up to 180,000 square kilometers of land and payment of $963 million, divided among regional, urban, and village corporations. In total, ANCSA and related legislation produced changes in ownership of about 601,000 square kilometers of federally-controlled landapproximately one-ninth of the state. Of the compensation money, $462.5 million was from the federal treasury and the remainder from shared oil revenues. Before ANCSA, Alaska Native peoples co-owned the land with the federal government. After ANCSA, they became shareholders of their regional and village corporations. Regional corporations own subsurface mineral rights, village corporations own only surface rights. Most village corporations selected lands near the community. ANCSA requires regional and village corporations to share 70% of their natural resource revenues from oil and gas, mining, or logging. This system protects corporations whose lands are poor in natural resources. It is unlike the reservation system in the Lower 48 states, where Indian reservations are not required to share revenues. Of the approximately 80,000 Natives enrolled under ANCSA, two-thirds reside in villages. All of the village corporations opted to be profit-making rather than non-profit, and most of the regional corporations set up nonprofit corporations of their own.
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Initially, unborn children were excluded from becoming shareholders. And after 20 years of protectionbeginning in 1991corporate shares could be sold, making non-natives eligible to become shareholders; lands would be liable for taxation by the state, and the regional corporations would be open to hostile takeovers. These defects were corrected in 1989, when an amendment to the Act protected the land from foreclosure in bankruptcy and authorized stock issues for children born after 1971. The corporate model had its problems, but the majority of native leaders supported it. In addition to securing title to their traditional lands, they anticipated that the cash compensation could stimulate economic development in their communities and enhance their cultural integrity. Some Native corporations experienced early financial difficulties, but most got through their startup pains and were stable by the mid-1980s. By the early 2000s most corporations were financially successful, due in part to an opportunity to sell tax losses in the 1990s. Several corporations began to pay substantial dividends to their stockholders, and many had real estate and operating company holdings across America. Native leaders credit the act with protecting the Native land base in Alaska and establishing Native equality and legitimacy in the state. Arctic Slope Regional Corporation The Arctic Slope Regional Corporation (ASRC) embraced the for-profit corporation model. The ASRC website, whose lands include the Prudhoe Bay oilfield, describes itself as follows: ASRC is a private, for profit Alaska Native owned corporation representing the business interests of the Arctic Slope Inupiat. Corporation headquarters are based in Barrow, Alaska with administrative and subsidiary offices located at Anchorage and throughout the world. ASRC owns approximately five million acres of land on Alaskas North Slope in areas that have both known resources and high potential for oil, gas, coal, and base metals. ASRC is committed to developing these resources and bringing them to market, in a manner that respects Inupiat subsistence values while ensuring proper care of the environment, habitat and wildlife.

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These lands were acquired strategically. When ASRC began selecting the five million acres of land entitled to its shareholders under the Alaska Native Claims Settlement Act, it set clear goals and objectives: To gain title to the lands with the greatest resource potential To explore and develop ASRC lands To produce and market the resources from them.

The ASRC mandate is to: Preserve Inupiat land, culture and traditions; Represent the eight Arctic Slope villages, with their growing shareholder population of 11,000 and ASRCs nearly 10,000 employees; Develop its family of companies in professional fields; and Foster relationships through stewardship of the land and villages, and by developing shareholder human and financial resources.

ASRC has subsidiary companies that began with the revenues earned from the oil industry and have expanded from there: engineering and consulting services, civil construction, oil and gas support services, petroleum refining and distribution, aerospace engineering services, communications, venture capital management and facilities management. ASRC clients range from local to multinational corporations and local to federal governmental agencies. In this respect, the Alaska Slope Regional Corporation resembles the older and larger development corporations in Canadathe Inuvialuit, Nunasi, and Makivik.

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