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Illustration by Anthony JenkinsThe Globe and Mail

The Conservative government has shown that it favours Enbridge's proposed Northern Gateway pipeline to carry bitumen from Alberta's oil sands to the B.C. deepwater port of Kitimat. Despite this open support, there's a risk that the Northern Gateway proposal could go the way of the Mackenzie Valley pipeline – ultimately approved in principle but held up so long it never gets built, because the market has found alternative options.

About 50 first nations lie in Northern Gateway's path. Consultation with these first nations will be critical, so let's look at the legal framework.

In the 1997 Delgamuukw case, the Supreme Court of Canada held that aboriginal title still exists across British Columbia where treaties have never been signed. That includes most of the province except for the northeast, where Treaty 8 was negotiated in 1899-1900. The court ruled that aboriginal title had not been extinguished by B.C.'s course of dealing with indigenous people, even though the government had assigned them to reserves and granted to others the lands on which they used to live.

The court, however, did not designate aboriginal title to specific tracts of land; that remains to be worked out in the B.C. treaty process. The first nations, meantime, have a right to be consulted about economic development projects that might affect the value of their claims to aboriginal title. The government can't authorize trees to be cut, fish to be caught, and minerals to be dug, then say, "Okay, it's your land now." Consultations must be full and thorough, accommodation to first nations' concerns must be made where possible, and compensation must be paid where interests are damaged.

But – and this is a crucial point for Northern Gateway – first nations do not have a veto. The court was very clear in Delgamuukw that "the building of infrastructure … can justify the infringement of aboriginal title." Consultation, accommodation, compensation? Yes. Veto? No.

Treaty 8 first nations are in a situation that is different in law but similar in practical effect. They surrendered their aboriginal title, but Treaty 8 gave them the right to continue hunting, fishing and trapping on Crown land until the government took up such lands for other purposes. The Supreme Court decided in Mikisew (2005) that the government had to consult Treaty 8 nations before approving infrastructure that might affect their wildlife harvesting rights, even off reserve. Again, consultation, accommodation and compensation are involved but not a right of veto.

Enbridge has been discussing Northern Gateway with first nations for at least five years. It has offered them an equity stake in the pipeline plus other benefits, and has also made cash grants to some first nations to finance their participation in the consultations. Another level of consultation is now being carried out by the Northern Gateway joint review panel, appointed by the National Energy Board and the Minister of the Environment to consider business and environmental issues at the same time. It will sit for almost two years and hear from thousands of intervenors, including first nations that choose to appear, and it can recommend various forms of mitigation, accommodation and compensation in its report to the federal government.

This may sound like a lot of consultation, but the ensuing litigation is likely to be even more protracted. Although Supreme Court decisions have denied a first nations veto, they have not laid down clear criteria for assessing the adequacy of consultation. Thus the door is open for any and all first nations to seek judicial review, and that could mean a tsunami of litigation. For pipeline proponents, the risk is not so much failure to gain official approval as subsequent delays in court that might render the project uneconomic.

Tom Flanagan is a professor of political science at the University of Calgary. He has managed campaigns for the Conservative Party of Canada and the Wildrose Party of Alberta. He is co-author of Beyond the Indian Act: Restoring Aboriginal Property Rights .