Pipeline industry playing hardball with Trudeau Liberals over Bill C69

CEPA says new environmental impact assessment act is too weighted toward climate change, First Nations, environmentalists, and gender diversity

The Canadian pipeline industry has come out swinging against federal changes to the way projects will be assessed in the future. The old system wasn’t broken, recently introduced legislation “doubles down” on the problems the new process was meant to fix, and the federal government can count on no new pipe in the ground unless there are significant changes to Bill C69, was the basic message Chris Bloomer brought to Parliament Hill last week.

The head of the Canadian Energy Pipelines Association was appearing before the Standing Committee on the Environment and Sustainable development.

He promised at the start of his remarks that he would be direct and the veteran oil patch executive was true to his word.

“If the goal is to curtail oil and gas production and to have no more pipelines built, this legislation may have hit the mark,” Bloomer told committee members during his March 29 appearance.

The details of CEPA’s critique in a moment, but it’s important to understand the heart of this debate: is it better to have pipeline critics inside or outside the tent?

The Justin Trudeau Liberals are betting inside is better.

Jim Carr, natural resources minister.

“Our interim principles for environmental reviews, as well as our proposed changes to the impact assessment system, are designed to restore confidence that good projects will move forward in a more predictable, timely, and transparent process that not only protects our environment and respects Indigenous rights, but provides the certainty that businesses need,” federal ministers Jim Carr (natural resources) and Catherine McKenna (environment and climate change) wrote in a Feb. 21 op-ed in Energi News.

Carr, in particular, has been trying to reassure industry that Ottawa’s changes – including a revamped national energy regulator and a separate environment impact assessment agency – are an improvement that will facilitate the $500 billion of resource development Canada is expecting over the next decade.

Industry isn’t buying a word of it.

In Bloomer’s view, the old system wasn’t broken but pipeline opponents convinced the Liberals otherwise.

“CEPA consistently emphasized that the NEB was the best placed regulator to oversee the full cycle of a pipeline from beginning to end,” he told committee members. 

From industry’s point of view, environmental groups, First Nations, and other special interests have wormed their way into what should be primarily a technical process. Nor does it help that the Trudeau government is perceived to care far more about its climate change agenda than supporting the Canadian oil and gas sector.

Despite CEPA’s very strong recommendation to move broader public policy from project-specific reviews, these issues are now explicitly included in the review process as factors to consider,” said Bloomer.

Science and fact-based assessments will now be obscured by the layering of other policy-based assessments. They’re ill-defined, fluid and open to potential strategies of delay and obscuration of the processes by groups opposed to any project.”

Indigenous communities have led the anti-pipeline fight in BC, yet the new Act specifically calls for integrating “traditional knowledge” into project assessments. How will that work?

The Act says that any concerned Canadian who wants to should be able to participate in an assessment. What happens if opponents stuff the process with thousands – or tens of thousands – of requests, as happened during the review of Kinder Morgan’s Trans Mountain Expansion project?

How will the impact assessment agency account for downstream emissions – a brand new impact standard – which are created in other countries where the oil is refined and burned?

What is the assessment process for gender diversity?

“The bill is flavored throughout with the government’s commitment to meeting climate change objectives, gender-based analysis, indigenous reconciliation and subjective and inherently unpredictable sustainability test,” said Bloomer.

Small wonder pipeline operators are gun shy.

Northern Gateway was rejected by Prime Minister Trudeau in 2016 after 11 years and an NEB approval. Energy East was cancelled by TransCanada at a cost of $1 billion after downstream emissions were added to the assessment at the last minute.

Bloomer says the big issue for his members is a “process that is an expensive, lengthy, polarizing and ends with a discretionary politic decision…Given these concerns, it’s hard to imagine that any pipeline project proponent would be prepared to test this process or have a reasonable expectation of a positive outcome at the end of it.”

CEPA clearly believes pipeline opponents should be outside the tent, preferably involved in a process designed to evaluate policy, not reviewing the technical merits of specific projects.

And if investors share that opinion, as Bloomer claims, then the Trudeau government is in trouble.

Canada depends upon foreign capital to finance natural resource projects, like pipelines and mines. If the Liberals’ shiny new impact assessment act creates less investor confidence, not more, then a lot of good paying jobs and some much needed tax revenue may be in peril.

Some clever adviser in the Prime Minister’s Office needs to figure out a strategy that meshes government and industry objectives or there won’t be any new natural resources projects to assess.

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1 Comment

  1. Experience and the behavior of ENGO’s suggest all opportunities to slow down and object will be taken. Adding to what is a unreasonably protracted process fails Canadian’s.

    Avoiding the decision that pipelines in general are safe and necessary infrastructure as a starting point vs. the assumption of the proposals that pipelines as a matter of definition unreasonably interfere with the environment is a reverse onus that is nonsense. The observation that if investment views political uncertainty as a barrier to investment C-69 fails, is a test already met, a > $10 billion reduction in annual capital investment should be sufficient evidence in addition to the steep discounting of Canadian energy stock pricing.

    The Liberal Government has abdicated leadership of the broader interest of Canadian’s as subservient to foreign ENGO objectives. Trading Canadian interest for the political support of foreign special interest is abhorrent.

    Bill C 69 is disingenuous at best and at outrageous at worst

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