Gambler First Nation exits PADCOM equity deal

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This article was published 20/12/2024 (263 days ago), so information in it may no longer be current.

A western Manitoba First Nation that had a one-fifth ownership stake in Manitoba’s first potash mine company near the town of Russell is no longer a stakeholder in the venture, the Sun has learned.

Legal counsel for Gambler First Nation confirmed the split between the band and the Potash and Agri Development Corporation of Manitoba (PADCOM) with the Sun during a Wednesday phone call. Until this past summer, Gambler — an Ojibway community situated about 190 kilometers northwest of Brandon — was a 20 per cent equity owner in the locally owned potash mine. The mine itself is located in Harrowby, just west of Russell, near the Manitoba-Saskatchewan border.

“We are no longer in that business relationship with PADCOM,” Milad Alishahi, a partner at law firm MLT Aikins, told the Sun.

Alishahi said he was unable to divulge any additional information about why the business relationship between the Gambler First Nation and PADCOM had been terminated, and could not say whether the First Nation was pursuing any legal action against the mineral resource development company.

Initially set up in 2007 as Manitoba’s first potash extraction firm after securing mineral rights, PADCOM commenced production in June 2023. It also received assistance from the provincial government led by Premier Heather Stefanson at the time under the province’s new “Manitoba Critical Minerals Strategy.”

As part of the initiative, PADCOM received a short-term, $1.03-million loan from the Communities Economic Development Fund for the mine. The province also granted PADCOM the right to explore for potash on Crown land adjacent to the mine site.

Speaking to the Sun on Thursday afternoon, PADCOM president Daymon Guillas confirmed his company had indeed parted ways with Gambler First Nation with regards to the latter’s equity holding in the company. The split had occurred in August, Guillas said.

However, Gambler continues to be a partner in profit-sharing, along with other local First Nations, including Waywayseecappo First Nation, Birdtail Sioux First Nation, Treaty 2 Territory, Treaty 1 Territory and the Manitoba Métis Federation (MMF) government.

Guillas also stated that neither PADCOM nor Gambler First Nation are pursuing any legal action against each other vis-a-vis the equity agreement.

“That would never ever happen. We are not that kind of people. We are all interested in community and relationships,” Guillas said.

“Our interest is to have as many people benefit directly and indirectly from the project and we want meaningful partnership and benefit for our Indigenous communities.” When pressed for further detail, Guillas said he could not reveal the finer details of the partnership agreement on account of legally binding Non-Disclosure Agreements signed by both PADCOM and Gambler First Nation.

He also would not confirm which party pulled out of the agreement first, but was quick to add, “Anytime the Gambler First Nation would like to come back in … the door is never ever closed. I am always open to (more) investment because investment will increase our production and increase our profit-sharing and community benefits. So any investment is welcome because we can expand quicker.”

PADCOM has not entered into new equity partnership agreements with other First Nations following the breakaway with Gambler First Nation, but Guillas said his company remains committed to entering impact-benefit and profit-sharing agreements with new partners, including the MMF government.

“Our commitment to profit-sharing will never change and discussions are going on.”

Guillas also reiterated that this recent development has not impeded the company’s operations in any respect, stating that Gambler “would never do anything to harm the project.”

“There are other discussions that are going on, but our commitment to, ‘This is a Manitoba project and we are sharing the wealth’ is absolute, and we are in discussions under the NDA with others as well,” Guillas said.

The Sun also reached out to Gambler First Nation Chief David LeDoux for comment, but received an email response from Jordan Lysyshin, band manager at Gambler First Nation, stating, “Unfortunately at this time Chief David LeDoux does not have a comment. Please reach out to our legal team, requesting a statement on the situation.”

One of the main objectives of the mining project is to ensure that Westman communities directly benefit from the 250,000 to 500,000 tonnes of potash PADCOM eventually hopes to produce every year.

“We are building our inventory,” said Guillas, adding that the mining company currently holds a licence for an annual production of 250,000 tonnes of potash.

He further stated that the facility is currently on track to hit the 11 tonnes per hour — or 80,000 tonnes per year — production target.

“All our product is sold, but we haven’t delivered it yet. We still have to get it up to standard,” he said.

The company’s clients are primarily based in Manitoba, Saskatchewan and the United States.

According to Natural Resources Canada, Canada is the world’s largest producer and exporter of potash. Our potash reserves are also the largest in the world, pegged at 1.1 billion tonnes of potash (potassium oxide equivalent). Provincially, Manitoba is resource-rich in deposits of 29 of the 31 minerals listed on Canada’s 2021 Critical Minerals List.

Potash is primarily used to produce fertilizer.

» ssharma@brandonsun.com, mgoerzen@brandonsun.com, with files from Michele McDougall and Colin Slark

» Bluesky: @mattgoerzen.bsky.social