Pressure is off Indian tribes to develop energy resources
Denver — In the 1970s the pressure of the energy crisis suddenly put Indian Country - with its oil, gas, uranium, and coal reserves - back on US resource maps. Giant corporations began exploring the possibilities. And many of these native Americans were a bit overwhelmed.
Today, depressed economic conditions have relieved this pressure: No major energy contracts have been signed in a year. In fact, the big problem on reservations today is staggeringly high unemployment, with rates of 50, 60, even 70 percent common. Still, many members of the Council of Energy Resource Tribes (CERT), who met here last month, seem relieved.
''We're convinced that this is one of the best things that could have happened,'' says Ed Gabriel, the outgoing executive director of CERT. The value of energy resources on the reservations had jumped roughly tenfold in a few years. Tribal members were divided between those seeing the potential for achieving economic self-sufficiency and those arguing that social, cultural, and environmental disruption would result from headlong development. Adding to the uncertainty was a realization that neither the tribes nor the Bureau of Indian Affairs (BIA) had the expertise to deal as equals with the energy companies.
CERT, a 37-member tribal energy coalition, was set up in response to this situation. Funded by the US government at $2 million a year, this council was set up to provide technical assistance to energy-rich tribes.
The basic assumption upon which CERT was originally founded - that ''tribally owned fossil fuels gave us guaranteed national clout and an assured source of long-term revenues'' - is today questionable, acknowledges Peter MacDonald, the outgoing chairman of the Navajo Tribal Council and the father of CERT. However, Mr. MacDonald argues that CERT will help lead Indians into the ''post-industrial'' age.
It is a transition that ''Native American peoples are uniquely equipped to make - in part because we are not encumbered by huge capital investments in obsolete plants and equipment, or by the extraordinary infrastructure of metropolitan centers. . . . Our people are ready to leapfrog from a pre-industrial world to a post-industrial world - because the industrial world and the Industrial Revolution largely passed us by . . . ,'' MacDonald says.
The beginning of the end of native Americans' current world, the Indian engineer and leader says, came last spring, when the Supreme Court upheld tribal governments' authority to tax commercial activity on their land. This will be the financial ''fuel'' that will lead to genuine tribal sovereignty, he adds.
In the resource development realm, the Indian Mineral Act of 1982, which has passed both houses of Congress and requires only some joint conference work before it is sent to the President, will also open up a new world of opportunities, and risks, for American Indians. In the past, Indians have been restricted by the provisions of the Omnibus Indian Mineral Leasing Act of 1938. This has made it extremely difficult for tribes to do much besides lease the development of their resources to private companies, CERT's Thomas K. Tulk says.
The new act allows tribal governments to enter into joint ventures, service contracts, and virtually unlimited numbers of other agreements with private companies. It also will let tribes put up their resources as collateral for the financing of development, something now prohibited because of the trust status of Indian lands.
While the act provides ''great opportunities'' for the tribes, it also will create some problems and risks, Mr. Tulk warns. One problem is that the BIA does not have the technical capability to deal with a rapid proliferation of development contracts. A second problem involves the ''downside'' of using tribal resources as collateral. If the deal goes sour, the lender might foreclose. ''The Crow Reservation might become the Equitable Mutual Reservation, eliminating some reservations as we know them today,'' Tulk advises.
In fact, it is the question of the federal government's responsibilities as trustee in such cases which has hung up the new mineral act. The Reagan administration has insisted on a ''hold harmless'' clause that would absolve the US government of all responsibility if a development deal sours. According to Mr. Gabriel and other informed sources, a compromise is being hammered out that would limit such absolution to cases where changing economic conditions are at fault.