Trans Mountain’s biggest obstacle looks set to drag the long-running pipeline saga well into 2022

Construction may have resumed and Trudeau has promised to see TMX through, but it’s the legal delays that look set to hold everything back

With the Federal Court of Appeal set to hold its second hearing on approval of the Trans Mountain Pipeline in December, it may seem that the end is near for the long-running saga.

But the perception could well be illusory. While Prime Minister Justin Trudeau’s promise that his minority government will see the pipeline through remains fraught with political difficulties, it is the inexorable delays in the legal process that may present the greatest obstacle to the project’s fruition.

In August 2018, the Federal Court of Appeal (FCA) overturned the cabinet’s November 2016 order-in-council approving the pipeline, which was based on recommendations made by the National Energy Board (now the Canadian Energy Regulator) some six months earlier.

While the court found that Canada had acted in good faith and selected an appropriate consultation framework, the duty to consult had not been adequately discharged and “fell well short of the mark” by failing “to engage, dialogue meaningfully and grapple with the real concern of the Indigenous applicants so as to explore possible accommodation of (their) concerns.”

As a result, the court remitted the matter back to cabinet “to address these flaws and, later, proper redetermination” — effectively mandating a new consultation process while leaving no doubt that the courts were quite willing to review the consultation process exhaustively and to its very end.

“The clear message from the decision is that cutting corners is not on, and that extensive and frequent meetings as well as sitting down and nodding won’t be nearly enough without some meat on the bones of the process,” said Maxime Faille of Gowling WLG in Vancouver, co-counsel for Tsleil-Waututh, one of the First Nations affected.

More than a year after the ruling, however, there’s no end in sight to the legal process.

In February 2019, the NEB again recommended approval of the project. About four months later, the cabinet adopted the Board’s recommendations for a second time.

Pipes destined for the Trans Mountain pipeline are transported by rail through Kamloops, B.C. Gerry Kahrmann/PNG/Postmedia Network files

Virtually immediately, 12 applicants, comprised of eight First Nations, three environmental groups and the City of Vancouver applied for leave to challenge the new approval. The FCA allowed six of the applications — all First Nations — to proceed with challenges to the new consultation that preceded the latest approval.

“The key question for the court is whether the federal government has corrected the defects found in the first round of consultation,” says Matthew Kirchner, counsel to the Squamish Nation, one of the successful applicants.

The FCA is scheduled to hear the case in December, and if the court takes as long to render a decision as it did the first time around — about 11 months — November 2020 will be on the horizon.

But even that may be optimistic.

It turns out that three applicants who didn’t get leave in the FCA as well as two of the applicants who succeeded but found the ruling too narrow in scope have sought leave to appeal the Federal Court’s refusal to hear them to the Supreme Court of Canada (SCC). That could well delay the hearing on the merits scheduled for December in the FCA.

The key question for the court is whether the federal government has corrected the defects found in the first round of consultation —Matthew Kirchner, counsel to the Squamish Nation

But whenever the FCA rules on the second consultation process, it’s unlikely that everyone will be satisfied with the decision, meaning that another round of applications for leave to appeal to the SCC will follow, adding at least six months to the process.

And if leave is granted, tack on another 12-24 months for the court to hear the appeal and render a decision. The upshot is that it’s likely to be near the end of 2022 before the court case is done.

Unfortunately, a favourable result for Trans Mountain in the courts won’t necessarily mark the end of the regulatory process.

What is known as the “detailed route hearing” process must follow approval. The NEB started this process after the first cabinet approval but suspended it after the FCA’s first decision overturned it. If the pipeline is finally approved by the courts, the CER will continue the process.

The Crown Corporation resumed construction on the expansion project in August, and work is under way at the Westridge and Burnaby Terminals and at pump stations in Alberta.

Minister of Natural Resources Amarjeet Sohi announcing Trans Mountain construction would restart on Aug. 21. 2019. David Bloom/Postmedia News files

Construction is expected to begin shortly in Greater Edmonton and Yellowhead, as crews are finishing up pre-construction activities and environmental surveys in the area, the company said in an email to the Financial Post.

“We have received more than half of the pipe needed for construction and are staging it at storage yards along the route,” the company said, adding that the 2,200 workers have already been hired. “Our contractors have been ordering and receiving equipment, surveying and staking and doing everything possible to be ready to start construction in the other areas as soon as possible.”

As the Federal Court of Appeal case makes its way through the court, the company plans to continue with all aspects of planning and construction.

“The applications are challenging the decisions made by the Canada Energy Regulator and the Federal Government, but do not in and of themselves negate the pre-existing approvals provided by those governmental authorities until and unless the court rules otherwise,” the company said.

But it won’t be simple.

A pipeline crossing marker in Burnaby, British Columbia. Ben Nelms/Bloomberg

Both the Coldwater Indian Band, also represented by Kirchner, and the City of Chilliwack have filed statements of opposition to the routing of the project. Coldwater, supported by WaterWealth, a Chilliwack based citizen-driven advocacy group, maintains that the pipeline’s route will have adverse effects on the Band’s water sources.

In support, Coldwater’s expert hydrogeologist insists that a proper study of the pipeline’s effect on water sources need to be done over a period of time so that appropriate baseline data can be collected. Proponents of the pipeline, including the federal government, say that isn’t necessary.

That dispute could, in turn, set off its own run of legal proceedings.

Perhaps no one should be surprised at the plethora of twists and turns.

After all, as Thomas Issac in Cassels Brock & Blackwell LLP’s Vancouver office points out, Trans-Mountain is the “most consulted-upon project” in Canadian history.

“Even the highly controversial Northern Gateway pipeline didn’t have all the different and difficult maneuvering around Trans Mountain,” he said. “So the people who want to see this through are going to require a lot of fortitude — because the other side has plenty.”

SOURCE

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Some hard truths (and a dirty little secret) about Canadian energy

TMX will help, but Alberta and Canada need a lot more


Houses, bottom, line the side of a hill in Burnaby, the terminus of the TMX, as the downtown Vancouver skyline is seen in the distance. (Darryl Dyck/The Canadian Press)

This is an opinion piece from Brian Jean, who was MLA for Fort McMurray-Conklin in northern Alberta from 2015-2018. He led Alberta’s Opposition as Wildrose Party leader for two years and ran to lead the UCP when his party merged with the PCs in 2017 but lost to Jason Kenney. Before that, he represented the Athabasca and Fort McMurray regions as a Conservative MP for a decade.

Alberta’s energy sector is the goose that lays golden eggs for Canada.

It has attracted millions of young, hardworking people to Alberta. It is the reason why Alberta contributes more financially to Canada than any other sub-national region in any other country contributes to its central government.

Quebec is sustained by equalization dollars that come from Alberta. If Ottawa has tax revenue to distribute as equalization, it is because hardworking Albertans and the energy industry are paying those taxes.

Ottawa benefits from all the wealth that Alberta’s energy creates, so much so that a two-month cratering of Alberta’s oil prices in the last quarter of 2018 slashed national GDP growth to zero.

That massive financial benefit is now at risk because of short-sighted decisions by politicians.

Alberta has oil that the world wants to buy, that Canadians want to buy, but Canadian politicians don’t want to make the reasonable accommodations that would let us sell it.

Recently politicians have been focused on the Trans Mountain pipeline expansion (TMX). That is good, but we need more than that. TMX isn’t enough to make Albertans stop worrying about being taken for granted by Canada and it isn’t enough to ensure Alberta’s and Canada’s long-term prosperity.

Alberta produces just under four million barrels of oil per day (bpd). We consume about 25 per cent of that in Canada and we sell the rest to Trump’s America — at a discount.

America is our only foreign customer. They are also our top competitor.

Because of fracking discoveries, the U.S. is now the world’s top producer of oil. They don’t really need our oil and they need less every day. That is part of the reason why our oil sells at a discount that Alberta’s former NDP government concluded was costing the Canadian economy $84 million a day.

TMX will hardly change that.


An oil tanker anchors at the terminus to the Trans Mountain pipeline in Burnaby, B.C. TMX’s shallow port can’t accommodate modern supertankers. (Chris Corday/CBC)

If TMX is finally built it will send a further 590,000 bpd to Vancouver. That helps, but only a little.

It’s a dirty little secret that most of the new TMX oil will be sold to U.S. west coast refineries. Very little of it will go to China, Japan, Korea or India, despite the fact that all of them want it. At most TMX will sell a few hundred thousand barrels a day to Asia.

You see, Vancouver’s shallow port can’t accommodate modern supertankers.

Most oil gets shipped in two million-plus barrel supertankers, but Vancouver can only handle 800 thousand barrel ships, and those can only be three-quarters filled before they bottom out.

The cost advantages of transporting Alberta oil in efficient supertankers will never happen via Vancouver. And that means TMX alone won’t lead to a growing Alberta energy industry.

If Alberta’s energy industry isn’t growing, it will never again fill the 30 per cent of downtown Calgary that is currently empty. It’s that simple and that bleak.

Canada needs a growing energy industry in Alberta. To be successful we need to sell more than two million barrels a day to a customer that isn’t the Americans. That’s Asia or, better yet, Canada.

What Alberta needs is a deep-water export pipeline to Asia or the Energy East pipeline to eastern Canada. Either would lead to a booming Alberta economy, which could sustain the Canada we all know.

That is what Alberta would have, if we were the only decider on this file — if just economics went into making this decision.

It’s time our politicians were honest with Albertans and Canadians.

TMX is a start, but it isn’t enough.

We need to work on a solution that gets Alberta a customer, other than the Americans, for two million barrels a day of oil.

That customer should be the rest of Canada. SOURCE

 

Trans Mountain construction set to begin in Alberta, with ‘pipe in the ground before Christmas’

After multiple delays, the Financial Post has learned crews are preparing to start construction work on the controversial pipeline in Alberta

CALGARY — After years of delays, pipeline construction is ready to begin on the Trans Mountain expansion project.

Large-diameter green pipes that will carry oil from Alberta to the British Columbia coast have been stockpiled at various points along the path of the Trans Mountain expansion project since the summer. The Financial Post has now learned that crews are preparing to start construction work on the controversial pipeline in Alberta.

Trans Mountain spokesperson Ali Hounsell confirmed there would be “pipe on the ground” with the intention of putting “pipe in the ground before Christmas.” She said an event was planned for Tuesday to mark the beginning of right of way construction on the pipeline project. MORE

‘Mr. Delay, Mr. Deny’ and Canada’s precarious climate change future

Both Scheer and Trudeau have much to improve upon when it comes to climate policy; the Liberal government, in particular, is mired in deepening contradictions on environmental matters


PHOTO: Justin Trudeau/via Wikimedia Commons

During the recent federal leaders’ debate, Conservative Leader Andrew Scheer only distinguished himself on climate issues by earning the title of “Mr. Deny” from Jagmeet Singh, leader of the New Democrats.

But Scheer nonetheless had two important insights into environmental issues raised during the campaign.

First, he reiterated the contradictions of the Liberal government’s approach to climate change, noting of Justin Trudeau’s participation in the Sept. 28 climate strike march in Montreal:

“I find it interesting and ironic that Justin Trudeau is actually protesting his own government’s record on the environment.”

Second, he has noticed, correctly, that for the most part, “the largest (industrial) emitters receive an exemption” from the Liberal’s carbon pricing system.

Of course, rather than addressing these contradictions and gaps by strengthening the way the carbon pricing system applies to large industrial polluters, the Conservatives would simply scrap the “job-killing” carbon pricing system altogether.

That, as Trudeau rightly pointed out, would remove the central element of Canada’s strategy for meeting its obligations under the Paris climate change agreement and effectively replace it with—if based on the feeble contents of the Conservatives’ own climate strategy so far—nothing.

At the same time, Scheer promises to use long-dormant Constitutional powers to override provincial and Indigenous objections to a national energy corridor that seems designed to cement Canada’s role as a high-carbon export economy for decades to come.

Separatism revival?

PHOTO: Andrew Scheer/Andre Forget via Wikimedia Commons

It’s difficult to imagine a better strategy for reviving the otherwise moribund separatist movement in Quebec given the strength of the objections to the proposed Energy East pipeline throughout the province.

That said, Scheer’s observations about the Liberal government’s contradictions on the climate file emphasize the point that the approval, then the $4.5 billion purchase, then re-approval of the Alberta-to-Vancouver Trans Mountain pipeline has become a millstone around the Trudeau government’s neck when it comes to appealing to progressive voters.

The defection of those voters to Singh’s NDP and Elizabeth May’s Greens threatens Trudeau’s majority government, and perhaps his ability to form a government at all.

Ironically, with the exception of the Trans Mountain pipeline question, the government’s record on the environment and climate change, although not perfect, is certainly respectable.

Trudeau’s Liberals have done more than any previous federal government to implement effective policy measures to reduce GHG emissions. They achieved a federal-provincial near-consensus (only Saskatchewan and Manitoba refused to sign) on the December 2016 Pan-Canadian Framework for Clean Growth and Climate Change.

In the aftermath of that agreement, which included commitments by all provinces to adopt some form of carbon pricing, Trudeau has stood remarkably firm in the face of opposition from newly elected Conservative premiers in Ontario, Alberta and New Brunswick.

The federal carbon pricing backstop is now being implemented in whole or in part in six provinces and all three territories. It was originally expected that, under the Pan-Canadian Framework, all of the provinces would implement their own carbon pricing systems. A major federal role in the process was never anticipated.

To its credit, Trudeau’s government has applied the federal backstop as provinces abandoned their commitments under the Pan-Canadian Framework and dismantled their own carbon pricing systems.

The government’s support for the Trans Mountain project was grounded in a deal with former Alberta premier Rachel Notley, exchanging a federal commitment to pursue a pipeline to tidewater for Alberta’s constructive engagement in a national climate change strategy.

Fair trade-off

This was, arguably, a reasonable trade-off. Alberta’s refusal to engage in discussions of serious climate change policies had been the key stumbling block in more than two decades of efforts to formulate an effective national climate change strategy following the adoption of the United Nations Framework Convention on Climate Change at the Rio Conference in 1992.

Notley’s NDP government was initially true to its word and did engage seriously on the climate change issue. It participated in the 2016 Pan-Canadian Framework, implemented a carbon tax in Alberta, initiated a phaseout of coal-fired electricity and launched major strategies around energy efficiency and renewable energy.

None of these things can be said of Notley’s successor, Jason Kenney, who as leader of the United Conservative party became the premier of Alberta in April.

Rather, Kenney has made a point of shredding Notley’s climate change strategy, particularly the carbon tax. Kenney has signalled his intention to join the quixotic challenges by Ontario and Saskatchewan to the federal carbon pricing system to the Supreme Court of Canada.

He’s also challenging the federal government’s new environmental assessment legislation, Bill C-69.

The situation begs the question: If Alberta has walked away from its part of the bargain, why is Trudeau—dubbed “Mr. Delay” by Singh in the debate—still trying to move the Trans Mountain project forward?

Why not put pipeline on hold?

Wouldn’t it have been a better political and climate change strategy to put the pipeline on hold until Kenney agrees to re-engage, in a serious and constructive manner, on climate change?

The political cost of such an approach appears to be low. Trudeau’s continued support for the project seems to be winning him few friends in Alberta anyway. At the same time, it would have given the Liberal leader a much stronger response to his Green and NDP challengers.

It would have also provided a better justification for joining Greta Thunberg’s climate strike—Trudeau could have argued he was protesting the governments of Alberta, Ontario, Saskatchewan, Manitoba and New Brunswick and their refusal to take the issue seriously.

The future of Canada’s first serious attempt and—as May pointed out during the debate, potentially last opportunity—to actually implement an effective national climate change strategy now hangs in the balance on Oct. 21.

The Liberal government’s deepening contradictions on energy and environmental matters has played no small part in creating the precarious situation in which Canada now finds itself.

Future generations may well be justified in saying, as Thunberg recently did in her speech to the United Nations: “We will never forgive you.” SOURCE

SQUAMISH NATION CELEBRATES BC COURT OF APPEAL DECISION ON TRANS MOUNTAIN ENVIRONMENTAL ASSESSMENT CERTIFICATE

September 17th, 2019, North Vancouver, BC — Today, the Squamish Nation is celebrating the BC Court of Appeal’s decision on the Provincial Environmental Assessment Certificate for the Trans Mountain Expansion (TMX) Project. The Court ruled in favour of the Squamish Nation, given that the BC Environmental Assessment Office relied on the fundamentally flawed National Energy Board Report as its own Environmental Assessment Report in issuing its Certificate.

The Courts have directed the Province to reconsider the Environmental Assessment decision “in light of the changes to the original report of the National Energy Board as set out in its reconsideration report.”

“The Federal Court of Appeal ruled that the original NEB report was so flawed that it doesn’t legally constitute a report, so it only makes sense that a Provincial Environmental Assessment Certificate issued based on that fatally flawed report would have to be revisited. Ideally, the BC Government would have come to that conclusion on its own, but we’re nonetheless pleased that the Court sided with the Squamish Nation in its decision to send this matter back to Cabinet,” said Khelsilem, Squamish Nation Councillor and Spokesperson.

The Provincial government must now heed the Court’s decision and start the review process over again before a Provincial Environmental Assessment Certificate can be issued. The Province of British Columbia needs to conduct a comprehensive environmental review of the TMX Project with the revised Environmental Assessment Act. MORE