Canadian energy junior Questerre Energy Corp. QEC-T has struck an economic development pact with an Indigenous group in Quebec to develop a zero-emissions natural gas hub on traditional First Nations territory, a move that kicks against Quebec’s stated ban on any future oil and gas development.
Questerre has signed a preliminary agreement with the Council of the Abenakis of Wolinak focused on developing what it called a “net-zero emissions energy hub” in the Bécancour region, Calgary-based Questerre said in a news release Thursday. The effort will centre on several pilot projects that produce clean energy including natural gas, the company said.
The Abenakis will be given a share in profits from the development on their land, according to the release. And they’ll also have an opportunity to acquire a working interest in Questerre’s exploration licences and participate in future development.
The deal is a potentially prickly one for Quebec Premier François Legault because it flies in the face of the province’s official position on oil and gas exploration and extraction. Mr. Legault has made it clear in recent months that there will be no further hydrocarbon development in the province and his government has been working on how best to compensate the companies holding some 180 active exploration permits, including Questerre. But dousing the economic growth ambitions of a First Nation could prove problematic.
“This is setting up an interesting showdown with the government,” Questerre chief executive Michael Binnion said in an interview, adding that the Abenakis of Wolinak have a long history in Quebec that predates the arrival of French colonists. “Our view is that they should let us go ahead.”
Quebec has enough natural gas to meet its own needs for an estimated 100 years or more, most of it concentrated in the province’s portion of the Utica shale formation along the southern flank of the St. Lawrence River, including the Bécancour region. But it remains untapped after significant public opposition to early drilling efforts, forcing Quebec to buy its gas from producers in Western Canada.
Questerre alone holds the licence rights to more than one million gross acres of farmland in the province. The company’s efforts to develop natural gas projects have been repeatedly thwarted by government moratoriums and its market value has collapsed.
Still, the company continues to try to carve out a place for itself in Quebec. It is shifting its resources and attention toward new technologies in a bid to produce clean energy it says could help the province meet its climate goals. And it has spent the past three years building social acceptability for its plans, in part by striking profit-sharing deals with towns in the Bécancour area as well as the Abenakis.
“With the many tragic events in Quebec and Canada, we believe that reconciliation has to move beyond words and to real action,” Council Chief Michel Bernard of the Wolinak Abenakis said in a statement. “We are pleased that Questerre has spent the past few years getting to know us, our history and our land in Quebec. They are the first company to fully recognize our traditional use territories and commit to move forward with full consultation and co-operation with our people. This agreement could bring the prosperity to our Nation and equality for our people while protecting the environment.”
Questerre is proposing to produce natural gas using hydroelectricity so there are no emissions, Mr. Binnion said. It wants to build two pipelines in the Bécancour area – one carrying carbon dioxide and another carrying natural gas. The company would sell the gas to local industrial clients while taking back the carbon dioxide and storing it, he said. It has submitted an application to government authorities to test a carbon-sequestration reservoir.
Quebec is pushing a ban on oil and gas development for climate reasons but what Questerre is proposing has no emissions, Mr. Binnion said. “So where’s the climate reason in that?”
A spokeswoman for Jonatan Julien, Quebec’s Minister of Energy and Natural Resources, did not respond to a request for comment.
Heading into an election year, Mr. Legault will be keen to protect any credibility he has gained in the public eye on environmental issues, said Christian Bourque, executive vice-president at polling firm Leger Marketing. But Questerre’s pact with the Abenakis makes it more difficult for his government to reject the proposal outright, he said.
“The discourse in Quebec and pretty much anywhere else in the country has changed towards Indigenous peoples. And this would be throwing a rock in the pond. It’s certainly a huge level of complexity added to the issue.”
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Nicolas Van Praet