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A logo is seen under a canopy of trees at a Shell petrol station in central London.TOBY MELVILLE/Reuters

The B.C. government has announced a ban on oil and gas exploration in an area of northern B.C. that was the scene of anti-development protests by First Nations members seven years ago.

As first reported by The Globe and Mail Tuesday morning, the province agreed to a deal with Shell Canada and the Tahltan Central Council under which Shell will withdraw its plans to explore for natural gas in a region known as the Klappan at the confluence of the Stikine, Nass and Skeena Rivers.

In 2005, some members of the Tahltan were arrested during protests against exploration in the area, which the First Nation calls the Sacred Headwaters.

In addition to giving up its petroleum tenures, Shell will build a new water recycling project to support its gas developments in northeastern B.C., which will be funded by $20-million in royalty credits from the provincial government.

Tahltan Central Council President Annita McPhee said the Klappan is one of the most sacred and important areas for her people and she acknowledged Shell for its decision to give up its development plans.

"I can't even begin to tell you how happy I am and how honoured I am on behalf of the Tahltan Nation," said Ms. McPhee, reached in Terrace, B.C. "It's a huge honour for our nation to have this beautiful area protected."

She said the Tahltan will now work to permanently protect the Klappan.

ForestEthics spokeswoman Karen Tam Wu said worldwide and local pressure by First Nations and environmental groups prompted Shell to take its plans elsewhere.

"The solution that they've come to is quite a creative one," she said. "It creates a win for the company and a win for the government and it gets the company out of the headwaters," Ms. Tam Wu said.