Northern Gateway proves that if Canadian oil/gas industry doesn’t change its political narrative, pipeline projects are in danger
Northern Gateway – the dead pipeline walking, the zombie pipeline – finally died yesterday at the hands of Justin Trudeau. Good riddance. But has the Canadian oil and gas industry learned anything from its failure?
The project was mishandled from the start and deserved its fate.
This is not a popular view among Canadian conservatives, especially in Alberta.
“We are also extremely disappointed that the Liberal government has rejected the Northern Gateway pipeline. This project alone would have boosted Canada’s GDP by over $300 billion over the next 30 years and it’s a project the Alberta legislature gave its full support to in a Wildrose motion last spring,” Wildrose Party Leader Brian Jean said in a statement, echoing federal Conservative leader Rona Ambrose, and conservative commentators everywhere.
Jean’s worldview, shared by Enbridge, is what really killed the project.
In fact, it’s fair to say that Enbridge is a symbol of the Canadian oil and gas industry’s outright refusal to acknowledge that over the past decade the political culture around energy and energy infrastructure has profoundly changed.
That the political legitimacy fossil fuels enjoyed in 1955 or 1995 or even 2005 has been seriously eroded by a combination of the global climate change debate (many industry executives are still hardcore climate change deniers), the rise of the Big Green environmental movement (those same executives think that tracing American money supporting Canadian eco-activists will undermine credibility), the beginning of the energy transition to clean energy technology that Canadian voters recognize and support, and the growing legal and political power of First Nations (especially in British Columbia, which Calgary-based executives rarely visit and certainly don’t understand).
Enbridge, especially at the beginning of the process, conducted itself as pipeline companies have always conducted themselves: as if the National Energy Board and the Canadian Government were their clients.
The company had a very traditional, corporate, legal-oriented view of the NEB review process. Especially when it came to First Nations, who led the fight against Northern Gateway.
I have interviewed First Nation chiefs and leaders from northern BC, as well as industry managers responsible for aboriginal relations. The message is always the same: Enbridge was arrogant, condescending, and not committed to real consultations, never mind “partnerships.”
I heard stories of Enbridge staff flying into northern communities on the executive jet to have lunch with First Nations leaders, then leaving immediately after. Trinkets and beads stories, like a few hundred iPads handed out to a First Nations community. Scheduled conference calls with First Nations elected and hereditary officials who expected to speak to the CEO, or at least a senior official, but were instead fobbed off onto a manager.
It is not an exaggeration to say that the Enbridge brand is toxic in British Columbia.
Nor is it an exaggeration to say that Enbridge hasn’t learned much from its experience with Northern Gateway.
First Nations leaders don’t trust it, eco-activists bitterly oppose it, and municipal leaders rail against it.
The Trudeau Government came to the same conclusion as many of us have who followed the Northern Gateway debacle: the pipeline project was not salvageable.
But industry has not learned its lesson, either.
The months leading up to yesterday’s announcement were filled with shrill cries of “Give us pipelines! Give us pipelines!” from Alberta. Jean, Ambrose et. al. are still shouting the same message today.
Industry associations and their boosters hinted darkly about ending equalization payments to Quebec, railed against provincial and federal climate policies, and insisted over and over again that if Canadians just knew the facts, if they would just look at the science and the data and the economic benefits, everyone would “heart” the Alberta oil sands and the need for new pipelines.
That message does not play in the rest of Canada, but especially not in British Columbia and Quebec, two provinces Alberta desperately needs on side if new pipelines are to be built.
“[The data] shows us that there are strong voices on either side of the energy and environment debate but for the most part, most average Canadians are somewhere in the middle,” David Coletto, CEO of Abacus Data told me in an interview about a Sept. poll of Canadians about energy, climate, and pipelines.
“They recognize the importance of our country dealing with the climate crisis, dealing with carbon emissions but, at the same time, they’re not willing to completely give up on the energy sector and see the importance of that to the country, that they almost want a balanced approach. We tested this hypothesis, that kind of balanced approached would find appeal, and that’s what we found in our survey.”
Enbridge’s failure and the death of Northern Gateway is a testament to the need for a new, pragmatic, middle of the road energy narrative by the Canadian oil and gas industry.
Alberta industry boosters must stop shouting into the echo chamber that makes up only a small percentage of the national populace. Canadians in other provinces are listening and they’re not impressed.
National Gateway is dead, Trans Mountain Expansion is not built, and Energy East has only just begun its NEB review.
Now is the time for the industry and its boosters to learn the lessons of Northern Gateway. Failure to do so may yet imperil both Trans Mountain and Energy East.
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