That biography, written by Peter C. Newman, will tell the story of the aboriginal businessman – quite possibly Canada’s wealthiest.
Mr. Tuccaro will contemplate what to do with the $102-million he will take in when he finalizes a deal to sell his business, knowing that he still holds an additional $25-million in real estate.
And he will think of how he can use those funds, built up over three decades in which he profited handsomely from the oil sands, to lift up others.
Mr. Tuccaro, 54, is a member of the Mikisew Cree First Nation, out of Fort Chipewyan, Alta., a place that garnered attention after reports – discredited by medical authorities – that its location downriver from the oil sands created an elevated level of rare cancers.
But for Mr. Tuccaro, Fort Chipewyan was a launching pad for a career that has helped to reshape the expectations for Canada’s aboriginal communities, which face a deluge of resource development plans. Much of the public profile of the first nations’ relationship with the oil patch is negative as groups oppose oil pipelines and new mines, protesting at meetings and stoking fears that industry is devastating traditions and cultures.
Yet Mr. Tuccaro’s story – while in his 20s, he used income from working as a heavy equipment operator in the oil sands to buy a taxi licence in Fort McMurray, and three decades later comfortably negotiates with oil-sands chief executives on contracts for everything from heavy hauling to laboratory services – is in many ways a template for how business is now done in northeastern Alberta.
By his tally, native-owned and controlled corporations now count more than $1-billion in annual revenues from the oil sands. Companies run by just three bands – the Fort McKay, Mikisew Cree and the Athabasca Chipewyan – bring in more than half a billion a year, while Primco Dene Ltd., a fast-growing oil patch services company owned by the Cold Lake First Nation, says it will employ 700 people, more than 500 of them aboriginal, this winter.
“We’ve become an economic force. We’re respected now, where in the past people would look at us and say, ‘You don’t know how to do this,’ ” Mr. Tuccaro said.
His ambitions are increasingly shared among first nations, which have quietly embraced both the wealth generated by the oil sands and the substantial effort that energy companies have placed into boosting and building aboriginal businesses.
First nations people now commute from across western Canada to work as carpenters and scaffolders, housekeepers and receptionists, drivers and dry-cleaners – there is even a first nations-owned helicopter firm in Fort McMurray. The Northeastern Alberta Aboriginal Business Association, which counts Mr. Tuccaro as its founding president, has some 120 companies on its roster.
They are becoming increasingly important players. Take Primco, which does security, emergency, catering and housekeeping work. The company has opened a satellite office in Edmonton and is looking to open another in Saskatoon, both for recruitment.
It has already dramatically changed the prospects of its home base, Cold Lake. The company has had a mandate to create jobs in its community since the first days of its existence in 1999, when all it had was a garbage truck and hopes for a better future.
“At the time we were running 60, 70 per cent unemployment,” said Primco president James Blackman. “Now we’re below 10.”
Primco’s ability to secure contracts has come largely from set-aside contractual obligations, in which oil-sands companies sign deals with local first nations pledging certain benefits. Often, that means priority access on bids: “We get a good majority of our work through agreements,” Mr. Blackman said.
Companies such as Primco have sought to use that head start to build businesses that compete with others. Increasingly, they are succeeding. Last year, Royal Shell Plc said its oil-sands operations had spent $1-billion on contracts with first nations companies since 2005. Cenovus Energy Inc., which has several contracts with Primco, spent more than $240-million on aboriginal-owned and joint venture businesses in 2011, equivalent to 9 per cent of its total corporate capital spending, and up from 6 per cent the year before.
For some first nations companies, however, the ability to build wealth has not dispelled an unease over profiting from an industry with a heavy, and growing, industrial footprint. “There’s nothing healthy about it at all,” Mr. Blackman said. But, he added, there is little choice: “industry pushes through regardless. We have to work with them collectively to try to at least get a better livelihood for the loss of the land.”
Or, as Mr. Tuccaro puts it, oil-sands projects are “our new trap lines. If we don’t adjust, we’re just going to get left behind. We’re going to be just as poor as we were before the oil sands started.”
Industry benefits, too. By spending on contracts with first nations, the multinational giants pumping out the oil sands are gaining stability. “If we’re successful, then they’re successful,” Mr. Tuccaro said. “And when they go to apply for an expansion of their existing operations, they have support rather than roadblocks or negative interventions.”
At the same time, entrepreneurs such as Mr. Tuccaro are building businesses that have an unexpected allure for outside buyers. Brad Creswell is a partner in NCA Partners LLC, the Seattle-based private equity firm that bought out Mr. Tuccaro with plans to take the company public in September. With just about every bid for contracts in the oil sands, Mr. Creswell said, “you actually have to report to the oil company your aboriginal ownership and your aboriginal employee base.”
Having Mr. Tuccaro remain as a part-owner – he is taking 20 per cent of the $102-million purchase price in shares – can only help. It doesn’t hurt that many of Mr. Tuccaro’s workers are local, with 20 to 30 per cent from aboriginal communities. That’s an advantage at a time when companies are scrambling to fill positions and often must bring in outside labour.
“We think our involvement with the aboriginal community is going to be very positive,” Mr. Creswell said. “It’s an important aspect of us going forward.”
And the sale could help further aboriginal interests, as Mr. Tuccaro intends to use some of the proceeds to invest in other first nations businesses. He is also harbouring a dream: that one day, an aboriginal company will actually produce oil-sands crude, rather than just services for other companies. It’s not an outlandish possibility. The Fort McKay First Nation already owns rich oil-sands leases. It just needs to develop them.
“There is no reason why we can’t,” Mr. Tuccaro said.
Original Article
Source: the globe and mail
Author: NATHAN VANDERKLIPPE
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