01/31/2012 04:00 EST | Updated 03/31/2012 05:12 EDT

Mount Polley Mining Corp. reaches deal with Williams Lake band on expansion

WILLIAMS LAKE, B.C. - Mount Polley Mining Corp. has reached an agreement with a First Nations band in the B.C. Interior that had threatened to derail plans for a mine expansion.

Mount Polley and the Williams Lake Indian Band have signed a five-year agreement to settle issues of rights and title to the land where the mine has operated for 15 years and to lands where it hopes to expand in the near future.

"We are extremely pleased to conclude this agreement with Mount Polley Mining Corp.," Chief Anne Louie said in a statement Monday.

"We commend Mount Polley for addressing issues in relation to aboriginal title and rights, and are hopeful that this agreement will see us working collaboratively for the remainder of the life of the mine."

The agreement includes commitments on employment and contracting to the small band near Williams Lake, and Louie welcomed the focus the deal has on education and training.

Under the deal, the mine will contribute funding for scholarships, bursaries and other community projects. The agreement also addresses some of the band's concerns about environmental management, although just how that would happen was not specified.

“It represents an important evolution in our relationship with the Williams Lake Indian Band," said Brian Kynoch, president and chief executive officer of Imperial Metals Corp. (TSX:III).

Last September, the band announced that it was opposed to the B.C. Ministry of Energy and Mines decision that August to issue Mount Polley a permit to expand the mine, located 56 kilometres northeast of Williams Lake, in the band's traditional territory.

The band promised to seek recourse for that decision, one of a slew of First Nations to denounce development projects on their traditional territories in the absence of land claim settlements, including the Tsilqhot'in National Government's opposition to the proposed Prosperity gold mine project just to the west of Williams Lake.

Increasingly, as the tripartite process that has been ongoing for more than two decades to resolve treaty negotiations in B.C. has failed to produce modern-day agreements, B.C. First Nations and resource companies are announcing individual agreements.

Last fall, Louie said the province had a duty to consult with the band and had not on a project that could adversely affect members' hunting and traditional practices.

"The unfortunate consequence of the government’s failure to follow a proper process is that it once again pits First Nations against the mining industry and creates the likelihood of legal, or other, conflict," Louie said at the time.

The planned expansion of the mine is expected to significantly extend the life of the mine in an area where the forestry industry has been particularly hard hit by the mountain pine beetle infestation that devastated B.C. logging sector.

The band and the company will hold a signing ceremony on Feb. 6.