The fate of impact benefit agreements rests on oil prices – Financial Post
May 13, 2015
The cash flow squeeze brought on by falling oil prices can create a conundrum for companies that have entered into aboriginal impact benefit agreements (IBAs) with local communities.
“What happens to a company’s social license obligations during a temporary cessation of production or free-falling profits?” asks Adam Chamberlain in Borden Ladner Gervais LLP’s Toronto office. “What do they do about the promises they’ve made to local communities, indigenous people, governments and NGOs during the development stage?”
While the law does not require IBAs, they are an essential part of corporate-aboriginal relationships. They describe a project’s impacts, the commitments and responsibilities of both sides, and the way in which the aboriginal community will share in the benefits through employment, as well as economic, social and infrastructure development.
