Leaders of Labrador's Innu gave formal approval to a land claim agreement that attempts to rectify harm caused by one hydroelectric project, and guarantee income from another that has yet to start.

The Innu land deal clears a major hurdle to develop hydro power at Muskrat Falls, on Labrador's Churchill River. (CBC)

Newfoundland and Labrador Premier Kathy Dunderdale took part in the signing ceremony in the northern coastal community of Natuashish for what's called the New Dawn agreement.

New Dawn, which concluded decades of often fractured negotiations with the federal government, received overwhelming support during a ratification vote in late June.

The agreement has received special scrutiny both inside and outside Labrador's two Innu communities because it is deeply connected to the Lower Churchill hydroelectric project.

Innu support helps clear the way for the $6.2-billion plan to tap power at Muskrat Falls and export 825 megawatts of power first to Newfoundland, and then potentially as much as 40 per cent of that to Nova Scotia. The Innu will receive five per cent of Muskrat Falls profits.

Deal attempts to redress wrongs

But New Dawn also corrects what Innu have called grievous wrongs. The agreement gives the Innu the aboriginal recognition they did not receive when Newfoundland joined Confederation in 1949.

The Innu have legal title now to about 5,000 square miles of land, and have hunting and fishing rights to an additional 22,000 square miles. They also now have partial control to resource benefits on land covered by New Dawn.

Significantly, the Innu receive compensation for flooding of hunting grounds that happened when the Upper Churchill hydroelectric project was launched in the 1960s.

The compensation is worth about $100 million over 30 years. As well, the Innu will receive a share of Upper Churchill projects when Newfoundland and Labrador's contract with Quebec expires in 2041.