April 2018
Over the past few days, the concerns over the fate of the pipeline in the face of the BC government’s objections have been elevated to the level of a constitutional and political crisis, driven by an artificial deadline set by the pipeline’s Houston-based owner. The hyperbole about how the fate of this single project will somehow damage Canada’s reputation for political stability and as a safe location for investment is becoming potentially more damaging to Canada’s good standing than the fate of the pipeline itself. The situation raises questions about how much the crisis is real, and how much the country is being drawn into an elaborate exercise in political theatre in the run-up to the 2019 Alberta election.
If Alberta and the federal government really want to moderate the BC government’s opposition to the pipeline, their current strategy of attempting to bludgeon BC’s government into a humiliating and politically suicidal retreat constitutes the worst possible approach imaginable. The louder Alberta Premier Rachel Notley, Alberta PC leader Jason Kenney, and federal Natural Resource and Finance Ministers Jim Carr and Bill Morneau whinge on about the injustices of BC’s position, the harder it becomes for BC Premier Horgan to entertain any form of compromise.
BC’s position is far from one without justification. The pipeline was approved on the basis of a process established by Stephen Harper's Conservative government, a process that the federal Liberals’ 2015 platform described as deeply lacking in credibility and public trust. The Liberals’ 2015 electoral gains in BC, particularly in the lower mainland, rested in no small part on commitments to reform the process. Those commitments remain far from fulfilled.
Legitimate questions continue to exist around the risks and impacts of bitumen spills, the consent of affected indigenous communities, and the effects of pipeline expansions and the growth in oil sands production they are likely to induce on Canada’s ability to meet its GHG emission reduction commitments under the 2015 Paris Accord. The pipeline offers nothing to BC in terms of energy security, and little in economic development beyond temporary construction jobs. The appearance of a steady stream of public and indigenous protesters is no surprise in this context. Their presence is likely to grow as pressures on the BC government increase.
It is also important not to forget that while the Northern Gateway pipeline was rejected by the federal government, and the Energy East pipeline project (sensibly) abandoned by its proponent, Alberta has seen several major pipeline victories in the past few years: the reversal of Enbridge’s Line 9 to carry bitumen through Ontario and Quebec; the Enbridge Line 3 expansion through Manitoba to the US; and President Trump’s reversal of President Obama’s rejection of the Keystone XL pipeline to the Gulf Coast of the United States. In the context of these changed circumstances, there are serious questions about whether the Kinder-Morgan expansion is needed at all.
The situation presents the Trudeau government with some profound legal and political challenges. The legal and constitutional situation around the project may be far more complex than some observers have suggested. As Jason MacLean of the University of Saskatchewan has emphasized, recent jurisprudence on the scope of federal and provincial authority around environmental matters has stressed the sharing of jurisdiction and the importance of federal-provincial cooperation.
At the end of the day, the federal government does have the formal, legal constitutional authority to override provincial objections to any undertaking, specifically through the declaratory power provided by s.92(10)(c) of the Constitution Act. However, that power has not been exercised in relation to a new matter in more than half a century. The political consequences of such a direct assertion of federal authority in relation to a project that is not vital to national security, and to which a provincial government has expressed its direct opposition, would be profound, not only in BC, but across the country.
As Chantal Hebert and others have pointed out, such a brutal expression of federal power would be an enormous gift to the flailing sovereigntist movement in Quebec. In BC itself, it could dim the electoral prospects of the federal Liberal Party for decades.
Nor would even an exercise of the federal declaratory power override the constitutional rights of the affected indigenous people and communities to meaningful and substantive consultation, and accommodation of their interests.
There are no easy ways out of the current situation in the short term. Not panicking over Kinder-Morgan’s May 31st deadline would be a good place to start. If investors believe the pipeline will be profitable, they are likely to be there if and when it proceeds.
In the meantime, the federal Liberals need to admit, as their 2015 election platform already did, that the approval process around the project was deeply flawed and needs to be revised to address the issues being raised by BC, and the affected communities and First Nations. The federal government also must address the fundamental contradictions between approving infrastructure that facilitates the expansion of oil sands production - by far the most significant source of growth in industrial GHG emissions in Canada - and its international commitments to reduce Canada’s GHG emissions.
Alberta, for its part, has to face the emerging reality that the expansion of exports of raw bitumen is a losing and increasingly non-viable proposition. Rather it needs to focus on upgrading its output to higher value and lower risk products. Finally, BC must deal with its own contradictions around the province’s climate change strategy and its pursuit of GHG emission intense liquid natural gas exports.
None of the parties to the Kinder-Morgan dispute comes to the conversation with clean hands, but the current hysteria over the project has the potential to do more damage to Canada’s economic and environmental interests than the actual fate of the pipeline itself. A calmer and more mature debate is needed from all sides.