The battle over fish farm licencing in the Discovery Islands

 

 

The following guest blog appears with permission of our friend and colleague, Alexandra Morton. The battle she traces is fraught with peril for our wild salmon: keeping farmed salmon out of the narrow passages of the Discovery Islands is key to the survival of critically depressed stocks of Fraser River salmon. Returning at only one percent of their historic high levels for the past two years, many of these salmon populations are at risk of extinction. The stakes are high; and the industry machinations traced in this blog lay bare the stark contrast between our world view and theirs.

Alex’s book, “Not on my Watch”, details the sordid development of the industry from its earliest days. It is available from Upstart & Crow or a bookseller near you.

Alexandra Morton – June 23, 2021

Below are excerpts from the affidavits submitted by Mowi, Cermaq and Grieg to the federal court during the legal challenges mounted by industry to overturn the Minister of Fisheries decision to prohibit restocking of salmon farms in the Discovery Islands. They include communications between the salmon farming industry and DFO and the Minister. While DFO staff were on the frontlines responding to the salmon farming industry’s shock at being denied access to the Discovery Islands, senior managers appear to be actively trying to benefit the industry. The Introductions and Transfer staff provided firm, unyielding response to the increasingly demanding industry.

On October 23, 2020, Allison Webb, director of aquaculture management, met by phone with the BC Salmon Farmers Association (BCSFA). She told industry that the consultation process that was underway with 7 First Nations of the Discovery Islands over whether to renew salmon farms licences and they DFO would not be “re-prosecuting peer-reviewed science”, which Diane Morrison, managing director for Mowi West Canada, took to mean that DFO would not debate the DFO risk assessments (CSAS)[1]. 

At this meeting Allison Webb told industry that DFO would provide the industry with a list of farm sites being considered as part of the Discovery Islands consultations. This list was never provided to Mowi[2]. As you will see there is an ongoing debate over whether Hardwicke should have been included.

Allison Webb proposed to offer First Nations “enhanced monitoring” a sea lice risk assessment, area based management and a collaborative governance model[3].

Diane Morrison swore in her affidavit that Webb told Mowi that it was DFO’s preference to collect licensing fees in advance of the Minister’s decision[4]. However, in the affidavit of Tom Foulds, Manager, Sustainable Development & Environmental at Cermaq Canada, we see a letter from Kristen Daniel, Aquaculture management coordinator, DFO, who said “To enable timely licence issuance, industry has requested to be invoiced for the full licence user fee... in advance of the minister’s licencing decision”[5].That DFO had accepted money for the licences, but did not grant them for the full term, became an issue in the legal challenge by Mowi. I doubt we will ever know where the early payment idea originated.

The aggressive behaviour that characterizes Mowi is evident when Diane Morrison calls DFO veterinarian, Dr. Zac Waddington’s assessment that there had been “infectious larval lice build up” on wild salmon “untrue based on wild salmon monitoring programs and data which Mowi and others in the aquaculture industry have helped fund[6].” Morrison questioned whether he was also presenting this inaccurate data to the DI First Nations. This, she stated, was why it was so important that Mowi was at the table during these consultations.

[Editorial note: The failure of the salmon farming industry to understand that the consultation process with First Nations is a government-to-government process was fairly shocking to read and was a repeated theme throughout the proceedings. The statement on sea lice wasn’t shocking, but typical of the outright denial that has characterized industry’s response to its impacts for three decades—“never mind the photographic evidence and published, peer-reviewed papers to the contrary; we paid for science that shows there’s no impact.” The only new thing about that was that a DFO employee wasn’t going along with the charade. He recently left his employment and moved to New Zealand.]

Morrison makes the point “DFO has no authority to order the destruction of fish at this time[7]”. She makes the point that when Mowi agreed to remove farms from the Broughton the company expected additional capacity - “Part of Mowi’s agreement to decommission those sites reflected an expectation that new sites would be identified or existing sites expanded, including within the Discovery Islands,”[8]. I have been unable to find any basis for this expectation. Mowi repeatedly objects to Hardwicke being included as a DI farm[9].

Repeatedly Morrison states that Mowi has “been forced to cull”[10] stating “To be clear, any culling of fish by Mowi is not voluntary”[11]. Her final point in her May 31, 2021 affidavit is that the “Minister has not offered compensation for our losses. Elsewhere the companies make the point that the Minister has no legal right to order culling. 

In his affidavit, David Kiemele, managing director Cermaq, states the loss of three sites in the Discovery Islands will remove 20% of their annual business[12] even though Cermaq has another 23 sites in BC. He states that Cermaq got only 15 minutes advanced warning that they would not be allowed to restock in the DI[13] and that they had planned to stock 2,100,000 fish there in 2021[14]. December 2020, Cermaq entered an agreement with Wei Wai Kum to “support” a guardian program and on April 13, 2021 they entered into an agreement to 1) operate until Feb 2023; and 2) allow for the Cermaq fish transfers; and so Cermaq would support Wei Wai Kum science[15].

On November 9, 2020 Ginny Van Pelt, governance officer with DFO, asked Tom Foulds, Sustainable Development and Environmental Manager at Cermaq Canada, to include all upcoming applications for “marine to marine transfers, just so we can track any potential crunch points for applications” and Foulds replies “I forgot we had some sites double stocked this fall...”[16]

Nov 24, 2020 Kristen Daniel writes to Tom Foulds “To enable timely licence issuance, industry has requested to be invoiced for the full licence user fee...”[17]

The federal licence fees that Cermaq paid in Dec 2020 were: Venture Point - $4,494.93, Brent Island, $4,494.93, and Raza Island $3,439.62[18]. The minister issued abbreviated licences (expiring on June 20, 2022) for these sites, the day after her announcement on Dec 18, 2020.

After the April 16, 2021 court injunction against the Minister’s prohibition to restock DI salmon farms was granted to Mowi, Cermaq applied to transfer fish into Brent and Venture from Cecil Island (Broughton)[19]. On April 27 DFO informed Cermaq that the service standard had been increased from 20 to 40 business days to allow First Nations to review every transfer application for the DI.

David Boschman, managing director for Grieg Seafoods, said they had benefit agreements with three First nations - “significant portion of their sites are operating with consent of these nations.” Boschman says:

“Recent statements however by parliamentary secretary Terry Beech have removed our sense that we were moving forward with our regulators support. These statements are contributing to concerns by our investors around whether BC and Canada offer fruitful opportunities for global investment and growth... we conduct the same meeting again and again with no forward action by either regulator to an amendment or other application for operational improvement.” We are concerned that our efforts... our commitments to multidecade benefits agreements with Indigenous partners and full-time employment of people from numerous coastal Indigenous and non- communities may be in jeopardy...

When Mia Parker, Director of Environmental Performance & Certification for Mowi, offered to “support” the DI consultation with First Nations she was advised by DFO staff they “have all they need”,[20] and that all Mowi’s requests to participate were ignored or “rebuffed”[21]and that the cost to Mowi for decommissioning all the DI sites will be $5million[22]. She also said they would be unable to meet the deadline as they had never decommissioned so many farms at once[23]. Describing her meeting with Terry Beech, Parker said she was there to discuss the “Minister’s mandate to come up with a plan by 2025.”[24]

Communications between Mowi and DFO heat up with Richard Opala, Mowi West’s regulatory affairs manager, in his 413 page affidavit.

Seven of the DI farms have been licenced since 1986[25]. Dunsterville and Read sites are now owned by We Wai Kai (Cape Mudge)26 and it appears Mowi suggested to DFO that they would be restocking Bickley Bay, Thurlow, Brougham, Cyrus and Young Pass at some time after July 1, 2021 [26]. This is surprising as these sites have been empty for years.

Dec 18, 2020, Krista Sandberg, Aquaculture Data and Public Reporting Coordinator, explains Hardwicke has flipped back and forth between areas 3-2 and 3-3, but that in Dec 2020 it held a 1-year licence and that is why it is included in the DI decision[27] despite repeated opposition from Mowi. 

Starting in 2016, DFO began issuing 6-year licences.

January 6, 2021, Opala sent a transfer application to Ginny Van Pelt to stock Sonora Point from Big Creek hatchery. He attached a 4 page Briefing Note – “Consequences of DFO Decision to Close Discovery Islands Salmon Farms”. This states that Mowi needs a seat at the table wherever the transition will be discussed, that Cermaq requires alternative sites for the displaced farms, and time to develop a plan that won’t kill a climate friendly industry...” It says:

We need demonstratable/proof of certainty from government that there is a future so we can successfully secure investment and a future in British Columbia and Canada”

“Globally, MOWI ASA is questioning whether continuing in Canada is even viable

This situation has completely ended all planned investment in BC business ($112 M Capital Investment in MCW has already been rescinded ...” 

“... the Minister started the destruction of our industry”[28] 

February 5, 2021, Ginny Van Pelt writes to Opala acknowledging Mowi’s Jan 6, 2021 application to transfer 100,000 smolts from Big Tree Creek hatchery into Sonora Pt. She reminds him that the Minister announced, “no new fish of any size may be introduced into Discovery Islands facilities at this time” and so “we have to advise that a refusal of your application is being considered”. However, she states that the application will be considered.[29] 

February 9, Opala writes back that the Minister did not consult with Mowi, and that they have not received any clarity on the origin and extent of the application of the DI announcement. Mowi has “no recourse but to proceed with its original plan and pursue a permit to transfer the fish...” and if it was unsuccessful in getting the permit Mowi “will be forced to cull millions of salmon....and loss of direct revenue to British Columbians and Canadians”.[30] 

February 24, 2021, Ginny Van Pelt acknowledges an application to transfer 600,000 smolts from Port Elizabeth to Phillips Arm, the proposed transfer date is March 30. Again she advises refusal of the application is being considered[31] 

February 26, Minister Bernadette Jordan responds to Opala:

“... you provided substantive information around the potential negative social and economic consequences... should your application to transfer fish be denied. I have given due consideration...However the majority of First Nations... are strongly opposed to salmon aquaculture in this area, notably for reasons related to conservation ... and cultural reasons. In my view social acceptability... is lacking... As such, in light of these concerns, I have denied your application.”[32] 

February 16, Opala sends DFO an application to transfer 800,000 smolts from Larsen (Broughton) to Sonora(DI) and Ginny Van Pelt replies on February, “we have to advise that a refusal of your application is being considered.”[33] 

March 6, Opala writes to Tracy Sandgathe complaining that the Hardwicke site should not have been included in the Discovery Islands decision. He states that the Minister was aware that the Discovery Islands were the ultimate home for the fish when she approved the transfer of smolts from a hatchery into the Port Elizabeth farm. He complains that the Minister did not engage with Mowi on the possibility of a “no-transfer” mandate and did not take advantage of Mowi’s numerous offers to participate in discussions with First Nations. He states Mowi has no choice but to continue applying for transfer licences, and that “The Minister’s decision will result in a substantial financial loss to the company...” and that “social acceptability” was never considered on previous transfer licence applications.[34]

[Editorial note: Social acceptability of aquaculture never has factored into decision-making about this industry and therein lies the essence of the problem we face today. The fact is that social and economic considerations are properly within the Minister’s purview under the Fisheries Act, when making decisions about the proper prosecution of fisheries.] 

March 31, 2021, Minister Bernadette Jordan writes Opala to say that she has denied his Feb 16 application to move fish from Larson to Sonora in Nodales Channel, Discovery islands. 

On April 16, Opala applies for a transfer licence of 600,000 Atlantic salmon from Port Elizabeth into Phillips Arm (DI). He states “In our view, it would not be in keeping with the proper management and control of fisheries to effectively order the culling of 600,000 fish...” He argues that Mowi “has achieved ‘social acceptability’”. He goes on to say this this latest transfer licence application “is the result of that injunction” granted by the court on April 5, 2021. He repeats twice “Mowi has no choice but to proceed with our original plan and pursue this transfer.”[35]

April 27 Ginny Van Pelt writes to Opala to provide an update - in light of the court ruling, moving forward DFO will be engaging with First Nations on every fish transfer – giving them 15 days to respond (5 days for Phillips) and this was why DFO was introducing a 40 business day standard response time on all transfer licence decisions. She adds that any decisions regarding transfers into to the Discovery Islands will not affect the policy to phase out salmon farms in the Discovery islands.[36]

April 29, Opala writes back “Mowi requires a decision on this application by May 4, 2021...” , [bolding is part of his response] “we see no reason it couldn’t be processed by that date”. He requests that DFO confirm whether it has begun engaging Laichkwiltach First Nations. “It is important that this Court order be respected” to turn back the clock. Mowi disputes again that Hardwicke is or ought to be included in the closure order.[37]

May 3, Ginny Van Pelt asks when Mowi intends to harvest the fish out of Phillips [if the transfer application is granted]; Mia Parker answers any transfers into Phillips or Hardwicke would be out by June 30, 2022.[38] 

May 5, Opala writes Ginny Van Pelt asking to amend transfer application submitted on April 16 from Port Elizabeth to Phillips Arm and instead asks for the fish to be transferred to Midsummer Island in the Broughton. He writes: 

To be clear, Mowi was been forced to submit this amended application, modify its operations, and cull fish as a result of the Minister’s and DFO’s failure to process our April 16th application in a timely manner.” I think they had to cull the fish that had been intended for transfer from a hatchery into Midsummer; this appears in the Diane Morrison Affidavit. 

He argues that the previous application was submitted “in good faith” and “based on the Federal Court injunction issued by Justice Pamel and the Minister’s ongoing duty to manage Canadian fisheries for the benefit of all Canadians.”

He says Mowi disputes that it was appropriate for the Minister to consider new, previously unarticulated factors, i.e. “social acceptability” but that they provided this information simply to expediate the application process:

We expected that this application... would be processed and approved in a manner which supported our operational timeline. We repeated that expectation... We were disappointed... to learn the Minister would be implementing a new longer process... given the clear direction of the Court and given our operational timelines. We were quite clear that a delayed application would result in the culling of fish. 

Please confirm that you will process the amended application for a new destination in accordance with the 20 business day service standard...”[39]

[Editorial note: Since Alex wrote this enlightening summary of the evidence, Cermaq failed in its court challenge attempting to force a reconsideration of its fish transfer licence applications. They, and Mowi, have gone on to present additional applications to transfer fish into the Discovery Islands, each of which has been refused by the Minister. We do not doubt that these transfer denials will show up in subsequent affidavits alleging bad faith on the part of the Minister, as we progress toward the hearing of their judicial review applications this fall. Safe Salmon partners and Alex Morton are intervenors in those applications and will argue in favour of the Minister’s (belated, but very welcome) consideration of public interest.

The failure of the industry to be able to comprehend that their interests are not co-incident with those of the public is the real eye-opener here: as if we would sell out our wild salmon for a couple of thousand jobs and four-digit resource rents!]

 

[1] Affidavit 2 Diane Morrison – 79

[2] Affidavit 2 Diane Morrison- 80

[3] Affidavit 1 Diane Morrison - 85

[4] Affidavit 2 Diane Morrison - 85

[5] Affidavit Tom Foulds, Exhibit F, pg 89

[6] Affidavit 2 Diane Morrison – 91

[7] Affidavit 2 Diane Morrison - 117

[8] Affidavit 2 Diane Morrison – 115(f)

[9] Affidavit 2 Diane Morrison - 128

[10] Affidavit 2 Diane Morrison – 132, 144, 147

[11] Affidavit 2 Diane Morrison - 147

[12] Affidavit David Kiemele – 8

[13] Affidavit David Kiemele – 13

[14] Affidavit David Kiemele – 29

[15] Affidavit David Kiemele – 38, 39

[16] Affidavit Tom Foulds, Exhibit D, pg 77

[17] Affidavit Tom Foulds, Exhibit F, pg 89

[18] Affidavit Tom Foulds – 23

[19] Affidavit Tom Foulds - 43

[20] Affidavit Mia Parker – 61

[21] Affidavit Mia Parker – 80

[22] Affidavit Mia Parker – 101

[23] Affidavit Mia Parker – 434

[24] Affidavit Mia Parker – 72

[25] Affidavit 3 R. Opala - 5

[26] Affidavit 3 R. Opala – Exhibit F, pg 136

[27] Affidavit 3 R. Opala – Exhibit H, pg 142

[28] Affidavit 3 R. Opala – Exhibit T, pg 267

[29] Affidavit 3 R. Opala – Exhibit T, pg 263

[30] Affidavit 3 R. Opala – Exhibit T, pg 262

[31] Affidavit 3 R. Opala – Exhibit U, pg 272

[32] Affidavit 3 R. Opala – Exhibit X, pg 300

[33] Affidavit 3 R. Opala – Exhibit X, pg 297

[34] Affidavit 3 R. Opala – Exhibit Y, pg 305

[35] Affidavit 3 R. Opala – Exhibit AA, pg 313

[36] Affidavit 3 R. Opala – Exhibit CC, pg 395

[37] Affidavit 3 R. Opala – Exhibit CC, pg 393

[38] Affidavit 3 R. Opala – Exhibit CC, pg 397

[39] Affidavit 3 R. Opala – Exhibit CC, pg 402


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