Resource Development Council

Matthew Nicolai -
Speech to the Resource Development Council
June 19, 2007

Note: This is a copy of his speech, as provided

Mr. President, Members of RDC, and Guests! Like the other speakers I am honored and privileged to share my thoughts with the guests and members of RDC. Developing our resources while honoring the past is today’s theme for RDC luncheon.

All Alaska Native Cultures have norms and mores to respect and honor our past while we develop new ideas and goals to ensure our future. For millennia we have paid great and detailed attention to the abundant natural resources of our lands to honor and respect the teachings of our Elders. Caring for the natural resources has always been at the forefront during our past history on the land. It is the instruction from our Elders that provided the source of strength that bound and guided our daily lives, to make the right choices for the common good of the people we serve.

Alaska Natives have successfully managed natural resources through the teachings of our Elders. Managing natural resources in our past was done for the purpose of providing resources for the future. Concepts of land ownership are foreign to our Native Cultures. In the past we looked upon the cultural value of land for the purpose of preservation of the culture and the resources it depended on. Land ownership in our Native Cultures is a new concept brought to our cultures through the Alaska Native Claims Settlement Act.

Alaska has a distinctive position, unlike many states, where native claims were settled through unique and untested charters by state and federal governments. These charters set up the 12 ANCSA regional corporations and 223 village corporations who own 44 million acres of subsurface and surface properties. To date none of the 12 regional or 223 village corporations have closed their doors, which is due to one common bond that ties us together. I will explain that later.

During the past thirty two years, these unique charters set up by state and federal governments established great opportunities for all Native corporations, especially in resource development. Before the charters were set up in 1971 we were stewards of the lands that nurtured and sustained our families. Today we have made great advances by making choices to develop the bountiful resources identified on our lands. However, these advances have been made one step at a time.

Developing natural resources in the Native community has been a long and arduous process, usually made through a consensus process. The consensus process takes a long time as compared to western society’s standards of decision making process. The decision process invigorates the emotional intelligence of our native people because, by our very nature, we are cautious people. In our world, emotional intelligence is usually managed through the trust and leadership of the Elders within our cultures.

Elders are very much respected in our communities because their wisdom and teachings increase awareness, in the present, that we must prepare our people for the future through constant changes to meet new challenges.

I remember in the early 1980’s the support for ANWR at the AFN convention was achieved through debate by all the AFN membership. Regional caucuses were called upon when the emotional intelligence became un-restful. Elders addressed the nay-sayers in each regional caucus and support for ANWR passed on the floor of the convention.

Elders in the Yupik culture possess confidence in the future due to their understanding of past challenges and the barriers that prevent successful dialogue. The basic rudimentary rule among Elders is to constantly listen, show confidence in self and humility to those around them. In our Yupik culture, we have rules that provide proscriptions against every peril. Elders carry the wisdom to translate rules and give admonishments for all our actions.

These traits are relied upon by our leaders when decisions have to be made in developing our natural resources. In the 1970’s-1980’s, the leaders of our region were not interested in development of the subsurface lands due to inept rules established under federal and state regulations.

We had many resource-related companies visit us with expectations that their riches would enliven agreements to explore regional subsurface lands. That did not happen. Our leadership was listening to the Elders’ advice that it was not the right time to develop such agreements and we had very lively debates in our regions. New federal and state regulations in the mid 1980’s resulted in a new direction for Native corporations. These new rules brought encouraging changes regarding development of Native lands. Native corporations started to develop subsurface agreements one region at a time. Today basically all regions have subsurface agreements for mineral, oil and gas exploration or production.

These subsurface agreements affect all of us because of the ANCSA Section 7(i) 7(j) Agreement. ANCSA Section 7(I) natural resource income from regional corporations is shared under the 70/30 formula basis. As I understand the ANCSA 7(i) revenue sharing, it came from our long standing traditional values that require us to constantly share all we have with all peoples with whom we have a common heritage.

The wisdom of the Elders who negotiated the sharing formula of ANCSA 7(i) has been a godsend to all our villages and the communities we serve. ANCSA Section 7(i) is the common bond I mentioned earlier that I wanted to explain. ANCSA Section 7(i) ties all Native corporations together to benefit in total. Income from timber in Southeast, oil and gas from Southcentral, minerals from Northwest, and oil from the North Slope are shared among 12 regional corporations and 223 village corporations. Nowhere else in Native American law has such law as ANCSA been implemented to benefit the whole. Total funds shared from ANCSA resource income have surpassed $812 million dollars to date from active regions developing their oil, gas, timber, and mineral properties. The 56 village corporations in our region have received $72 million dollars through the ANCSA Section 7(i) agreement.

Many village corporations in our region use these funds to purchase fuel, goods and services for their village corporations and for subsistence activities in our communities. All this has happened because of the sharing formula of ANCSA section 7(i).

The common bond of ANCSA Section 7(i) revenue sharing spurred development when our board passed resolutions of support to bring mineral exploration companies to our region. Since we changed our emotional intelligence, over $140 million dollars has been invested on Calista subsurface lands by several mineral companies.

The investment of these funds to our subsurface lands has had a huge impact to the very people we serve in our region. During the last ten years over 2,100 jobs were created from mineral exploration projects at Donlin Creek, Nyac, Goodnews Bay, Kako, Stuyahok and others. Just imagine if the Donlin Creek project becomes a mine, the economies of scale will change the economic profile of our region.

Our region has one of the highest rates of unemployment in the country. The creation of the Donlin Creek exploration project in the upper Kuskokwim region has changed the demographics and economic profile of the 10 communities there.

I remember that in 1994 when Placer Dome first started the hiring process of our Native people, we had a 365 percent turnover due to alcohol and substance abuse. Placer Dome ran a zero tolerance policy for alcohol and drug abuse. Today we only have a 4-6% turnover on the project. What a major change that precipitated.

There is something I want to share with all of you today regarding Donlin Creek. We hired Craciun Associates in 1994 to conduct a shareholder survey to better understand shareholder support of the Donlin Creek project. In 1994, we only had a very low 36% support level for Donlin Creek.

Just last year we conducted a new survey in our region and we saw a complete turnaround, with 76% of our owners now supporting Donlin Creek becoming a potential mine, provided that protective environmental measures were in place.

Today Donlin Creek is supported by AVCP, Inc. and the Kuskokwim Native Association. Our Calista Corporation Directors continue to travel to our communities to address local concerns regarding Donlin Creek.

We want to thank the predecessor of Barrick Gold Corporation, Placer Dome, for placing trust in our Elders and the leadership of Calista to develop a regional communication plan for shareholders of our company to learn and comprehend mining today under new federal and state mining laws. Placer Dome and Barrick invited Elders and leaders to visit new mines established under NEPA and the Clean Water Act in Montana and Nevada. These trips have been very educational and provided helpful learning experience to our Elders, regional leaders, and to our hosts.

Historically, mining companies did not listen to local concerns and sentiments from residents of the affected areas they mined. That changed with the arrival of new federal laws. New reclamation regulations do place a heavy burden on mineral companies to obtain local input.

Definitely, the new mining companies we are working with in our region are recognizing the importance of the leadership and emotional intelligence of our Elders who can guide us while we develop our resources and at the same time honor the cultural values of our past.

The State of Alaska has a lot to offer, but Native corporations have a lot more to offer. That is, Native peoples build upon the instructions of our Elders as a source of strength and adopt new ideas that will benefit the future. Definitely the Elders in our region have led changes that benefit resource development in our region.

I want to share a graph showing the result of attitude change when local residents and Elders lead that change. Significant financial investment has arrived in our region as a result of that change.

As Native people and Native corporations, we will develop our resources as we have done for many millennia, and we will continue to honor our past. Thank you for listening to our comments.