The Innu First Nation of Pessamit has rejected a landmark agreement their leaders negotiated with Quebec that aimed to settle a decades-long dispute over land use and deliver billions of dollars to the community while opening up new energy development in the province.

Members of the community of 4,300, located about 50 kilometres southwest of Baie-Comeau, Que., voted 63 per cent against the deal in a referendum whose ballots were counted Sunday evening during a live broadcast on Facebook. Quebec Premier Christine Fréchette’s cabinet authorized the government to move ahead with the pact last week.

“The Innus of Pessamit have spoken. They do not give authorization to their chief, René Simon, to sign” the agreement, said Alexis Wawanoloath, a lawyer overseeing the referendum.

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It wasn’t immediately clear whether band leaders would try again to win backing for the same deal or seek a renegotiation with Quebec. They had tried to rally support for the deal in recent days but it wasn’t enough in the end, with some community members saying they needed more time to digest the pact’s contents.

“This is a project of fairness and dignity for the next seven generations,” Pessamit vice-chief Andy Canapé wrote in a Facebook post Saturday. “It gives us, at last, the political power to decide our future, the compensation that’s due to us, and the financial autonomy to take care of our community.”

Reaching agreements with First Nations communities is crucial for Quebec and provincial utility Hydro-Québec, as it moves to build support for a $200-billion plan to develop new clean-power generation facilities and improve the reliability of the grid. Hydro-Québec’s former chief executive officer Michael Sabia, who engineered the plan before leaving the company (now led by CEO Claudine Bouchard), has called the effort “economic reconciliation.”

Details of the proposed agreement with Pessamit have not been widely distributed outside the community, but the band council has published some information on its social-media account in a bid to answer questions. That includes a video summary from a lawyer representing the council who recommends voting for the deal.

The pact includes $1.3-billion in guaranteed payments to the community to resolve outstanding legal disputes tied to the First Nation’s claim that Hydro-Québec has been using its portion of the Innu ancestral territory of Nitassinan without its consent for nearly 70 years. There are 16 dams and 13 hydroelectric power stations on the territory claimed by the Pessamit, which covers an area of about 250 square kilometres.

The agreement would also establish “a new relationship” between the parties governing future use of the land, according to the information posted. It names four specific projects that Hydro-Québec has on its radar for the Pessamit territory that would be the subject of future consultation, including a new hydropower station, a new transmission line, as well as unspecified wind power development.

The Pessamit Innu would have the option to participate in the new projects through different mechanisms that would generate revenue for the community. The band council estimates that the community could derive $7-billion in economic benefits over several decades from the deal, without saying how it arrived at that number.

Reached by phone, Mr. Wawanoloath said a simple majority of those who voted would have been enough to approve the agreement. In the end, 1,287 ballots were cast with 809 people voting no, 471 voting yes, and 7 ballots spoiled, he said.

Some residents of the community had argued that there hasn’t been enough time for them to take stock of what’s being proposed. Poet and artist Natasha Kanapé Fontaine penned a letter in La Presse dated July 10 in which she said the council sprang the deal on the community only a few days earlier. She called for the referendum to be rescheduled to a later date.

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Earlier this month, Hydro-Québec concluded a separate agreement with the band government of another First Nation, the Innu Takuaikan Uashat mak Mani-utenam Council. That pact resolves disputes relating to the Romaine Hydroelectric Complex and the Arnaud-Alouette transmission line.

Last month, Hydro-Québec struck a reconciliation and collaboration deal with Innu First Nation of Nutashkuan in the Côte-Nord region. The agreement lays the foundation for a partnership focused on energy development, the utility said.

Quebec’s bid to cement a new deal with Newfoundland and Labrador on Churchill River power was dealt a blow in May when Premier Tony Wakeham told reporters that his government rejects the memorandum of understanding on energy co-operation with Quebec that was signed by his predecessor in December, 2024. But rather than tearing it up or starting from scratch, he said he wants to use it as the basis for more dialogue.

The Premier said Newfoundland needs “more value” from the power purchase agreements at the heart of the MOU and needs “more transmission” through Quebec so his province can have the option to sell its share of the generated power at market rates.