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A model of the proposed Stie C dam at the Community Consultation Office in Fort St. John on January 16, 2013.Deborah Baic/The Globe and Mail

The panel assessing issues around the proposed $7.9-billion Site C hydroelectric dam in Northern British Columbia says thousands of hectares of land bought up for the project should be released if governments decide against the project.

Releasing the land could create future challenges for reviving Site C – a project that has lingered for decades and twice been rejected by the B.C. Utilities Commission.

The land would likely have to be expropriated again should a future government revive the project. BC Hydro is arguing the project is a necessity for meeting surging provincial energy needs in decades to come. Both the federal and provincial governments have six months to decide whether to approve Site C – the third in a series of dams on the Peace River.

The Joint Review Panel struck by the governments of B.C. and Canada said, as one of its recommendations in a long-awaited report released this week, that if the project does not proceed, the province should allow other uses for the land intended for flooding in a manner that preserves the agricultural, wildlife and heritage values of the Peace River valley after consultation with affected parties.

Asked about the panel recommendation on releasing the flood reserve, B.C. Energy Ministry spokesperson Matt Gordon said in an e-mail exchange that releasing the land would be a consideration after a government decision.

BC Hydro has bought a total of 3,068 hectares for the project since the 1970s of which 667 hectares would be flooded, the utility said Friday through a spokesperson. However, a total of 5,000 hectares of land would be flooded for the project – about 81 per cent owned by the Crown and the rest currently privately owned.

Farmer Ken Boon is pleased at the particular recommendation, which he says sums up an issue raised by landowners, environmentalists and First Nations who appeared before hearings held by the panel.

"That would mean the end [for the foreseeable future] of the project and that was what we were arguing for, and they have accepted that," Mr. Boon said in an interview Friday.

Mr. Boon said the Peace River valley is essentially being kept in a time capsule because the prospect of Site C has prevented development by landowners and others.

If some future government begins reassembling land, he said that future process "would be a lot nastier than using the land they have now," he said.

Environmentalist Andrea Morrison of the Peace Valley Environmental Association said Site C has cast a shadow of farmers, who would like expand their crops in the region but have held off because they didn't know whether their efforts would be submerged by the project.

The panel report says a total of 34 farms would suffer effects including the loss of land and farm infrastructure, but overall B.C. or western Canadian production wouldn't be harmed. Ms. Morrison and her group dispute that point. "The panel was wrong," said Ms. Morrison, a resident of Fort St. John, a city near the project.

But one regional leader said the report has left many seeking clarity. "The recommendations that came out are not a yes; they're not a no. It's 'If this, then this,'" said Lori Ackerman, the mayor of Fort St. John. "Those who are looking for the positives in it, that it moves forward, are certainly seeing that, and those [hoping] that it not move forward are seeing that as well."

A report from a joint review panel released Thursday urged provincial and federal governments to consider 50 recommendations if they decide to proceed with the Site C hydroelectric megaproject on the Peace River in northern B.C.

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