Panel Report

The Midwest Project proponent, Cogema Resources Inc., is a wholly-owned Canadian subsidiary of COGEMA (Compagnie Générale des Matières Nucléaires) of France.

The proponent, formerly Cogema Canada Ltd. and, before that, Amok Ltd., has been mining uranium in Saskatchewan at the Cluff Lake site since the early 1980's. Currently, Cogema owns 100 per cent of the Cluff Lake mine and mill complex, 70 per cent of the McClean Lake mine and mill complex, 36 per cent of the proposed Cigar Lake Project and 16 per cent of the McArthur River Project.

Cogema Resources Inc. operates the Cluff Lake and McClean Lake projects and manages uranium production facilities in Wyoming and Texas. It is also decommissioning and reclaiming two open pit mines and mills in Wyoming. The company is involved in exploration activities for uranium in Saskatchewan and the Northwest Territories, and for gold in Nevada, and is considered a dominant player in the world uranium market.

3.1 Royalties, Taxes and Fees

In Saskatchewan, The Crown Mineral Royalty Schedule sets the rate at which royalties are paid to the province and ensures that the value of uranium sold represents fair market value for Crown royalty purposes. The total royalties paid consist of a basic royalty (5 per cent of the gross sales revenue) and graduated royalties (tied to profit), less the Saskatchewan Resources Credit (1 per cent of gross sales revenue).

Uranium mining companies, including Cogema Resources Inc., are also required to pay various taxes to both the federal and provincial governments. These include property taxes, surface lease fees, corporate capital taxes and surcharges, federal and provincial sales taxes and large corporations taxes. In addition, the proponent would pay the employer's portion of payroll taxes, such as employment insurance premiums, Canada pension plan payments, and workers' compensation premiums.

3.2 Benefits to Northern Saskatchewan

In 1983, northern people comprised 45 per cent of the Cogema Resources Inc. work force. Today, northerners make up 59 per cent of the total work force at the Cluff Lake mine site and 61 per cent at the McClean Lake site.

In April 1994, in response to the 1993 approval of the McClean Lake Project, Cogema Resources Inc. opened a Northern Affairs Office in La Ronge. The mandate of this office is to maintain a corporate presence in the North, promote northern business, coordinate the hiring of northerners for the McClean Lake Project, and establish a recruitment program for residents of the impact communities.

In the area of education, Cogema Resources Inc. is also an active participant in the Multi-Party Training Plan. In addition, since 1979, the proponent has awarded 174 scholarships totalling more than $550,000. Most of the scholarship recipients have completed their study programs, and the majority have returned to work in the north.

In its Environmental Impact Statement for the Midwest Project, the proponent stated: "Our goal now is to encourage more Aboriginal people to pursue education and training paths towards employment in the professional areas of our operations." [The Midwest Project Environmental Impact Statement, Additional Information, Cogema Resources Inc., February, 1996, pp. 1.1-42.] This initiative should be encouraged.

There also has to be a spiritual side to any kind of development and that should be respected.

I. Campbell, Vice Chief, Meadow Lake Tribal Council, Transcript of Midwest Public Hearings, La Ronge, Saskatchewan, June 5, 1996, p. 103.

In the areas of northern expenditure and business opportunities, Cogema spent over $65-million on the purchase of northern goods and services in 1995. These purchases were made from approximately 40 different northern vendors.

Cogema has signed contracts with northern-based companies for specialty services, such as security and catering. In addition, all of Cogema's trucking requirements are supplied under contract by Northern Resources Trucking, a northern-based trucking firm owned 30 per cent by the Kitsaki Development Corporation; 29 per cent by Trimac Transportation Services; and 20 per cent by the Denesuline Development Corporation. The remaining 21 per cent of the company is owned by seven different First Nations organizations in northern Saskatchewan, with the majority of the truck owner/operators being from northern Saskatchewan, each operating his/her own unit.

In a more recent initiative, Cogema Resources Inc. has been working closely with Northern Employment Services, a northern recruiting agency, to maximize recruitment of northern aboriginal people from the Athabasca Basin for employment at the McClean Lake mine and mill site.

The proponent has donated approximately $80,000 to community development programs in various northern communities and contributed $100,000 to support the La Ronge Regional Health Care Centre in 1996.

3.3 Experience at the Cluff Lake Site

Cogema has operated a uranium mine and mill at Cluff Lake, Saskatchewan, for many years. This operation has been a leader in the industry with respect to the employment of northern people and the provision of business opportunities for northern contractors.

During the hearings, members of the public expressed concerns about the tailings management practices at Cluff Lake. It was stated that initial methods for disposal had failed, that a sizable spill had occurred, and that the current tailings management facility was of insufficient size and relied on an engineered barrier to provide environmental security in the long term.

Three fatalities have occurred recently at Saskatchewan underground uranium mines, including one at Cluff Lake. During an underground tour of the Cluff Lake mine in August 1995, the panel also observed questionable working conditions with respect to radiological protection and conventional health and safety practices. It was not obvious that the proponent, government regulators, union leadership and employees had been as diligent as possible in the implementation of stringent worker health and safety principles and practices.