Which way will Trudeau turn on Trans Mountain Pipeline?

  • 25 Aug 2016
  • Calgary Herald
  • Bloomberg

Pipeline plan creates balancing act for PM


In the rolling country of central British Columbia, Michael LeBourdais’s Whispering Pines Indian Band is looking forward to a cash injection from a new pipeline proposed by Kinder Morgan Energy Partners LP. He’ll be seeking compensation for his band if it doesn’t go through.

Meanwhile, 400 kilometres away near the pipeline’s terminus in Vancouver, the Tsleil-Waututh First Nation is battling the expansion, saying it will lead to oil spills on their tribal land and in the waters of Burrard Inlet.

Into this breach will step Prime Minister Justin Trudeau, who must decide on the $6.8-billion Trans Mountain pipeline expansion, which oil companies say is vital to get increased output from Canada’s oilsands to global markets via the Pacific Coast.

The conflicting native views underscore the delicate balance Trudeau must strike as he seeks to fulfil his promises of upholding aboriginal rights and responsible resource development while sparking growth in an economy reeling from plunging oil prices.

Trans Mountain brings together “in one file” the biggest priorities for Trudeau and his Liberal party government, with political implications that set environmental issues against the “cold, hard facts” of economic development, said pollster Nik Nanos, chairman of Ottawa-based Nanos Research Group. The scale of the decision may even force the prime minister to slow down the process and delay a ruling, currently set for the end of the year, he said.

This is “very tricky because of some of the conflicting priorities,” Nanos said. The decision will “be a big signal nationally and internationally and indicative on how the Liberals convert talk on the environment.”

Kinder Morgan plans to triple Trans Mountain’s capacity to 890,000 barrels a day by twinning the existing 1,150-kilometre line that runs through the mountainous Canadian province. The system, in operation since 1953, is the only pipeline from Alberta to the Pacific Coast and connects the oilsands directly to a port with reach to markets outside North America.

Input from stakeholders during Kinder Morgan’s 159 workshops and open houses as well as other feedback has “improved” the project, the company said in an emailed response to questions. The Houston-based pipeline operator has changed the route to avoid sensitive areas and made the pipeline thicker in some locations, it added.

In deciding Trans Mountain’s fate, the government is adding its own review of the project following the National Energy Board’s green light in May, subject to 157 conditions. The expansion probably won’t add to the climate impact of the country’s oil production, the Canadian Environmental Assessment Agency said in a separate report.

Still, even with the conditions and additional review, opposition to the pipeline remains stiff, especially near Vancouver with its beaches and environmentally conscious residents.

Mayor Gregor Robertson in June submitted a request for judicial review of the NEB’s decision. The expansion is “not in Vancouver or Canada’s economic or environmental interest,” the mayor said.

Chief LeBourdais at Whispering Pines, meanwhile, says he wants compensation if Robertson and other opponents succeed in blocking the pipeline, which would provide his band with a “very large sum of money” following years of negotiation with the company.

“If you’re going to say no, that’s OK, but then somebody owes me the value of that negotiated agreement,” he said.

And at a recent public meeting in Burnaby earlier this month as part of the federal government’s review on Trans Mountain, Burnaby Mayor Derek Corrigan summed up the challenges for Trudeau — using the prime minister’s own words.

“Justin Trudeau said governments give permits but communities give permission,” Corrigan told the panel. “Well, we don’t.”

Canada’s oil companies have struggled to win new outlets for their increasing volumes of petroleum — especially from the oilsands, where output may rise 50 per cent to 3.7 million barrels a day by 2030, according to the Canadian Association of Petroleum Producers.

With Enbridge Inc.’s permit for Northern Gateway recently revoked by a federal court and TransCanada Corp.’s Keystone XL approval rejected last year by U.S. President Barack Obama, the industry has pinned its hopes on Trans Mountain after years of disappointments.

“There is no question that a decision on the Trans Mountain pipeline is of significant national impact,” said Jeff Gaulin, vicepresident at the Canadian Association of Petroleum Producers, an industry lobby group in Calgary. “It will be a watershed moment for the development of Canada’s energy resources to reach more international markets.”

Trans Mountain will be the first test of Trudeau’s approach to Canada’s resource-heavy economy and highlights how the government is unprepared with policy to support decisions on individual energy projects, said Monica Gattinger, a University of Ottawa professor and director of the school’s Institute for Science, Society and Policy.

A policy framework that provides direction on climate, aboriginal relations and cumulative effects is needed to help resolve opposition to such projects, she said.

“We have a number of policy gaps around energy that frankly extend well beyond the remit of any individual energy project decisionmaking processes,” she said.

“Are governments really trying to make climate policy one pipeline at a time? That’s putting the cart before the horse.”

Trudeau wants to remake Canada into a low-carbon society while balancing natural resource development in an economy that relies on commodity exports, making the country more dependent on resources for economic growth than other large wealthy nations.

His government is currently developing a climate strategy, including a national price on carbon, in co-ordination with the provinces.

“All projects are reviewed individually based on science, evidence and the traditional knowledge of indigenous peoples,” Natural Resources Canada said in an emailed response to questions about the Kinder Morgan pipeline.

About prosperitysaskatchewan

Consultant on Saskatchewan's natural resources.

Posted on August 25, 2016, in economic impact, miscellaneous, oil, political. Bookmark the permalink. Leave a comment.

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