Trans Mountain pipeline protests continue as a new report estimates costs up to $13 billion for Canadian taxpayers

As construction of the Trans Mountain expansion continues and the British Columbia government weighs the risks of potential oil spills, protests against the project continue. “Tiny House Warriors And Braided Warriors Accomplices Lock Down On Trans Mountain Site” (Sparrow Project, April 3) describes the protest by those supporting the resistance of the Secwepemc First Nations – also as described in “ ‘We Will Not Stop’: First Nations Land Defenders Take Direct Action Against Trans Mountain Pipeline” in Common Dreams (April 3) . In what they call a “deep dive”, The Tyee and Investigate West co-published  “For BC’s Two Pipeline Fights, It’s Spring Forward”, which delves into the many actors in the continuing opposition to Trans Mountain and the Coastal Gas Link pipelines.  Also in The Tyee, “Youth Climate Activists Aim to Rally Support for Indigenous Land Defenders” describes the March 19 Global Climate March protest by Sustainabiliteens in Vancouver. The National Observer maintains an archive of articles documenting Trans Mountain developments, here. Amidst it all, the provincial government weighs granting an environmental certificate re protections for oil spills, as explained in “B.C. relying on the federal shoreline protections for Trans Mountain pipeline it previously called inadequate” in The Narwhal .

An academic report, released on March 31, supports the protests with financial and cost benefit analysis, as summarized by the CBC here.  Evaluation of the Trans Mountain Expansion Project is written by lead author Thomas Gunton, Director of Simon Fraser University’s  School of Resource and Environmental Management. The report concludes that continuing the construction of the Trans Mountain Expansion project will bring a net cost to Canada of $6.8 billion under base case assumptions – with the possibility of costs running as high as $13.3 billion  “….because the TMEP capacity is not required and therefore does not generate a benefit. Oil transported on TMEP could have been transported on other pipelines without expending funds building TMEP. Therefore, continuing to build TMEP as currently proposed is not in Canada’s public interest and the project should not proceed further.”

Much has changed since Professor Gunton’s previous evaluation in 2017 of the Trans Mountain expansion project, including the federal government’s purchase of Trans Mountain in 2018. The 2021 report, Evaluation of the Trans Mountain Expansion Project is highly critical of the previous assessments by the National Energy Board, used to justify the purchase – and makes specific note of how the NEB distorted job projections provided by the Conference Board of Canada to overestimate the job benefits. The December 2020 report of the Parliamentary Budget Office found that the Trans Mountain Expansion profitability was dependent on climate change policies – so the Gunton report updates the PBO analysis by taking into account the climate change policies announced in the December 2020 Healthy Environment Healthy Economy climate plan. Finally, it provides detailed cost benefit analysis both for completion and for termination of the TMX project – incorporating environmental costs, including the risks of pipeline spills. Regarding employment benefits, the analysis finds modest positive benefits, given the existing recession in the oil and gas sector.    

“A potential benefit of TMEP is providing employment to workers. As discussed in Section 3.2.6 of this report, the measure of employment benefits is not the gross number of jobs generated by TMEP but is instead the net employment and income gain of employees of TMEP relative to what they would have made if TMEP did not proceed. Historically, the economy of Western Canada has been characterized by tight labour markets in which most employees are employed. Under full employment, projects like TMEP would simply draw employees from other jobs with little to no net employment benefit. However, given the current recession and recent slowdowns in the energy sector and the potential of TM training and hiring employees through impact benefit agreements, there will likely be an employment benefit, with some hiring of persons who would otherwise be unemployed or employed at a lower wage.” (p.45).

President Biden’s Executive Orders and Keystone XL cancellation – what impact on Canada?

Incoming U.S. President Biden exceeded expectations with the climate change initiatives announced in week 1 of his term, and many have important repercussions for Canada.  The most obvious came on Day 1, January 20, with an Executive Order cancelling the Keystone XL pipeline and taking the U.S. back into the Paris Agreement.  Also of potential impact for the Canadian clean tech and auto industries – the Buy American policies outlined in Executive Order on Ensuring the Future Is Made in All of America by All of America’s Workers (Jan. 25). On January 27 ( “Climate Day ”), the Executive Order on Tackling the Climate Crisis at home and abroad (explained in this Fact Sheet ) announced a further series of initiatives, including a pause on oil and gas leases on federal lands, a goal to convert the federal government’s vehicle fleet to electric vehicles, and initiatives towards environmental justice and science-based policies. Essential to the “whole of government” approach, the Executive Order establishes the White House Office of Domestic Climate Policy to coordinate policies, and a National Climate Task Force composed of leaders from across 21 federal agencies and departments. It also establishes the Interagency Working Group on Coal and Power Plant Communities and Economic Revitalization, “to be co-chaired by the National Climate Advisor and the Director of the National Economic Council, and directs federal agencies to coordinate investments and other efforts to assist coal, oil and natural gas, and power plant communities.”    

The New York Times summarized the Jan. 27 Orders as “a  sweeping series of executive actions …. while casting the moves as much about job creation as the climate crisis.” A sampling of resulting summaries and reactions: ‘We Need to Be Bold,’ Biden Says, Taking the First Steps in a Major Shift in Climate Policy” in Inside Climate News (Jan. 28); “Fossils ‘stunned’, ‘aghast’ after Biden pauses new oil and gas leases” in The Energy Mix (Feb. 1); “Biden’s “all of government” plan for climate, explained” in Vox (updated Jan. 27) ;  “Biden’s Pause of New Federal Oil and Gas Leases May Not Reduce Production, but It Signals a Reckoning With Fossil Fuels”  (Jan. 27) ; “Biden is canceling fossil fuel subsidies. But he can’t end them all” (Grist, Jan. 28);  “Activists See Biden’s Day One Focus on Environmental Justice as a Critical Campaign Promise Kept”  and  “Climate Groups Begin Vying for Power in the Biden Era as Pressure for Unity Fades” (Jan 21) in The Intercept , which outlines the key policy differences between the BlueGreen Alliance (which includes the Service Employees International Union, the American Federation of Teachers, and the United Steelworkers in the U.S.) and  the Climate Justice Alliance, a national coalition of environmental justice groups.

The Narwhal provides an excellent overview of the important issues for Canada in “Biden has hit the ground running on climate and environmental justice. How will Canada respond?

Focus: Cancelling the Keystone XL Pipeline

The January 20 Executive Order halting the Keystone XL pipeline construction was meant to be a highly symbolic break with the previous administration’s policies, as described by Bill McKibben in the New Yorker as “Joe Biden’s cancellation of the Keystone Pipeline is a landmark in the climate fight” . Inside Climate News wrote “Biden Cancels Keystone XL, Halts Drilling in Arctic Refuge on Day One, Signaling a Larger Shift Away From Fossil Fuels” (Jan. 21).       

In Canada, the Keystone XL cancellation set off a torrent of reactions – with  Alberta’s Premier immediately calling for trade retaliation  – summarized in “‘Gut punch’: Alberta premier blasts Biden on revoked Keystone XL permit” (National Observer, Jan. 20) . The federal government held an Emergency Debate on Keystone on January 25, the first day the House of Commons re-convened after Christmas break. Environmental groups, along with social justice groups, First Nations, and the B.C. Government Employees Union, sent an Open Letter to Prime Minister Trudeau and all cabinet ministers on January 26, approving of the Keystone cancellation and stating: “Canada must follow Biden’s lead on Keystone XL and cancel TMX because it directly conflicts with the federal government recently announced climate plan and it does not have permission or consent from affected Indigenous Nations.”  An opposite viewpoint was reported in  “Keystone XL denial will hurt communities, Indigenous business coalition leader says” (National Observer, Jan. 22). Consistent with the past policies of the construction unions in the U.S. and Canada, Canada’s Building Trades Unions issued a press release expressing deep disappointment in lost jobs as a result of the decision – as did their U.S. counterpart the North American Building Trades Union (NABTU) . (The discord amongst unions over pipeline construction has been long-standing and well documented – for example, in Contested Futures: Labor after Keystone XL by Sean Sweeney ( New Labor Forum, 2016.)  

What next for Canada, now that Keystone XL has been cancelled?

CBC reports  “Trudeau government looks to continental energy strategy in wake of Keystone cancellation” (Jan. 27), which summarizes the unimpressive history of international energy initiatives but strikes an optimistic note because of the new Biden administration.  Eric Grenier summarizes the political and public opinion landscape and concludes that “For Trudeau, there’s no political reason to fight for Keystone XL” , and Aaron Wherry expands on that theme in “How political symbolism brought down Keystone XL” (Jan 23). In “Cenovus unveils capital spending plan, confirms up to 2,150 layoffs still targeted” (Jan. 29)  the CEO of Cenovus states that while the Keystone XL pipeline cancellation was a  “tragedy” for the industry, it wouldn’t affect his company’s ability to move oil and that Biden’s pause on oil and gas leasing, “is probably good for the Canadian oilpatch” . The Cenovus layoffs announced are not related to Biden’s policies but come as a result of its takeover of Husky Energy- Cenovus had already announced it would cut 20 to 25 per cent of its combined employee and contractor workforce (approx. 1,720 and 2,150 workers) in October 2020. 

Warren Mabee wrote in The Conversation Canada (Jan.21) “Biden’s Keystone XL death sentence requires Canada’s oil sector to innovate” – (republished in The Narwhal here ) arguing that Canada and Alberta “need to decide if more pipeline capacity is really needed” and “The future of Canada’s oil sector may not be in volume, but in value” – for example, high value-added products such as plastics, rubber and chemicals.   But this is Canada, so pipeline battles will continue: “With Keystone XL cancelled, all eyes turn to Trans Mountain expansion battle” (Ricochet , Jan. 27) and “The cancellation of Keystone XL raises the stakes for Trans Mountain (Globe and Mail Opinion piece, Jan. 26) . David Hughes has written, most recently in October 2020, that the Trans Mountain pipeline capacity is not needed, and on December 8 2020, the Parliamentary Budget Office released a report with the same conclusion. An excellent overview on the status of the Trans Mountain issue appears from the West Coast Environmental Law, and the Dogwood Institute maintains an online petition against TMX here.

First Nations, environmentalists file court challenges to Trans Mountain pipeline

orcas against Vancouver skylineOn June 18, as described in an earlier  WCR post, Government gives the go- ahead to Trans Mountain pipeline despite declaring a climate emergency.   By July 8, two court challenges have been filed against the decision.  Six First Nations, led by the Tsleil-Waututh Nation , filed a court challenge on the grounds that the federal government failed in the requirement to adequately consult them.  More details are described in  First Nations launch new court challenge to Trans Mountain pipeline at the CBC (July 9), and  First Nations renew court battle to stop Trudeau and Trans Mountain   in the National Observer.

Another separate appeal was also filed on July 8 by EcoJustice on behalf of Raincoast Conservation Foundation and Living Oceans Society, on grounds that the government decision doesn’t comply with the responsibility to protect endangered southern resident killer whales, whose survival would be threatened by increased tanker traffic. CBC reports here,  the National Observer also reports  in “Conservationists file legal challenge to Trans Mountain reapproval over whales.” 

Government gives the go- ahead to Trans Mountain pipeline despite declaring a climate emergency

climate emergencyOn June 18, in a controversial but expected move, the federal cabinet approved the expansion of the Trans Mountain pipeline, which would triple the capacity of the existing pipeline, and allow up to 890,000 barrels per day of bitumen to travel from the Alberta oil sands to a marine terminal in Burnaby, British Columbia.  The approval was described by The Energy Mix as “the height of cynicism” because the House of Commons had only 24 hours previously approved a government resolution declaring a climate emergency.  Although the government put on a positive face by predicting that “shovels will be in the ground” by September, the project still has to satisfy conditions set out by the National Energy Board,  including negotiated approval from First Nations.  As described in  “Why we’ll be talking about the Trans Mountain pipeline for a long while yet” in The Narwhal: “The embattled oilsands pipeline has become a proxy battle, pitting the urgency of the climate crisis against near-term economic concerns”.

A sampling of  Reaction and Analysis:

An Angus Reid poll, Shovels in the Ground was released on June 21.  It reports that 56% of Canadians agree with the government’s  approval of  TMX, compared with 24% who disagree. The primary concerns for Canadians, both those who support and oppose the TMX, are the possibility of a tanker spill due to increased traffic in the Burrard Inlet (68%) and the increased burning of fossil fuels from pipeline expansion (66%).

Canada approves Trans Mountain pipeline expansion for second time”  in the National Observer (June 18).  This general overview of the decision is part of the ongoing Special Report on Trans Mountain by the National Observer.

Trans Mountain approval makes mockery of climate emergency declaration” press release from the Council of Canadians.

“Cognitive Dissonance: Canada declares a national climate emergency and approves a pipeline” by Warren Mabee of Queen’s University  in The Conversation (June 20).

“Trudeau Declared a Climate Crisis, then Backed Trans Mountain Again” in The Tyee (June 18), which summarizes reactions from British Columbia, and states that B.C. will  take its case to the Supreme Court of Canada as it seeks the legal right to regulate the shipment of materials (including oil and gas)  within the province.

“Transmountain  pipeline approval triggers lawsuits leaves fossils unsatisfied”    in The Energy Mix (June 19).

“Business leaders welcome pipeline approval but fear it may not be completed”  in The National Observer. The article states:  “Mark Scholz, CEO of the Canadian Association of Oilwell Drilling Contractors, who said in a statement the pipeline approval is “trivial” and will do little to help a suffering western Canadian drilling sector. Approval doesn’t make up for the federal government’s pursuit of Bills C-69 and C-48, bills reviled by the industry to revamp the regulatory system for resource projects and impose an oil tanker ban on the B.C. coast, he said.”

Minister Morneau in Calgary to talk about the Trans Mountain Expansion project and the future of Canada’s Energy Sector “ (June 19)  a press release that lays out  the government’s best case for Albertans, and states that: “Every dollar the federal government earns from the project will be invested in Canada’s clean energy transition. The Department of Finance estimates that additional corporate tax revenues could be around $500 million per year once the project is online. These funds and any profits earned from the sale of the pipeline will be invested in the clean energy projects that power our homes, businesses and communities for years to come.”

billion-dollar-buyout LaxerA substantial analysis from a different viewpoint, Billion Dollar Buyout: How Canadian taxpayers bought a climate-killing pipeline  was just published by the Council of Canadians. Written by Gordon Laxer, professor emeritus at the University of Alberta, the report summarizes the long history of the Trans Mountain project, with a special interest in how it fits in to the United States Mexico Canada trade agreement (USMCA) and the energy goal of integrating Canadian oil and natural gas into the U.S. market.  Laxer also authored an OpEd in the Toronto Star on June 12, Don’t waste any more money on the Trans Mountain pipeline  .

Not all First Nations Oppose the Trans Mountain pipeline:  The National Observer summarizes First Nations opposition in “As Trans Mountain gets shovels ready for pipeline, First Nations vow to protect territory” (June 19), which  states that the Tsleil-Waututh Nation and Squamish Nation will use “all legal tools” available to challenge the TMX approval.  The Tsleil-Waututh Nation has commissioned an independent environmental assessment and an economic study which estimates that TMX expansion will cost Canada $11.8 billion, in addition to the environmental costs. It also predicts lower demand than the government has anticipated and unused capacity. The 127-page economic study, Public Interest Evaluation of the Trans Mountain Expansion Project is dated June 2019 and was written by Thomas Gunton, a professor at the  School of Resource and Environmental Management at  Simon Fraser University, and by Chris Joseph, a B.C. consultant.

Project Reconciliation  is an Indigenous-led coalition which aims to buy part of the pipeline and direct any profits to a Sovereign Wealth and Reconciliation Fund.  Their press release on June 18 applauds the government’s TMX decision.  A January 2019 article by CBC gives background on the group.  The Indian Resource Council is another group, composed of 134 First Nations bands most of whom are also interested in the economic benefits of  pipelines. CBC describes their meeting in  “More than 100 First Nations could purchase the Trans Mountain expansion pipeline” (Jan. 2019).  More recently, in June, the Iron Coalition  launched – “an Alberta-based Indigenous-driven organization with the sole purpose of achieving ownership in the Trans Mountain Pipeline (TMX).”  Iron Coalition leaders are from the Nakota Sioux Nation, the Papaschase First Nation and the Fort McKay Métis, and state that “all profits generated by Iron Coalition will be directed back to each member community to bring lasting economic benefit to Métis and First Nations in Alberta.”

 

NEB rules that Trans Mountain pipeline is in public interest, despite marine dangers and ignoring climate impacts

NEB reconsideration reportIn headline news on February 22,  Canada’s National Energy Board released the Report of its Reconsideration process (here in French), and for the second time, approved construction of the Trans Mountain Pipeline.  The NEB states: “…Project-related marine shipping is likely to cause significant adverse environmental effects on the Southern resident killer whale and on Indigenous cultural use associated with the Southern resident killer whale. The NEB also found that greenhouse gas emissions from Project-related marine vessels would likely be significant. While a credible worst-case spill from the Project or a Project-related marine vessel is not likely, if it were to occur the environmental effects would be significant. While these effects weighed heavily in the NEB’s consideration of Project-related marine shipping, the NEB recommends that the Government of Canada find that they can be justified in the circumstances, in light of the considerable benefits of the Project and measures to minimize the effects.”

The decision was expected, and reaction was immediate:  From The Energy MixNEB Sidesteps ‘Significant’ Impacts, Recommends Trans Mountain Pipeline Approval”  , which summarizes reaction;  from the National Observer in  “For a second time, NEB recommends approval of Trans Mountain pipeline expansion” (Feb. 22)  and  “NEB ruling sparks new vows to stop the Trans Mountain pipeline”.  An Opinion piece by Andrew Nikoforuk in The Tyee  is titled, “NEB ‘Reconsideration Report’ a New Low for Failing Agency” and from the Council of Canadians, “The fight to #StopTMX Continues as feds approve their own pipeline” .  From British Columbia, where the government has appeared as an intervenor against the pipeline , the Sierra Club reaction is here ; the Dogwood Institute pledged opposition (including a rally against the decision in Vancouver)  and pledged to  make the Trans Mountain project a major part of the federal election scheduled for Fall 2019;  and West Coast Environmental Law press release   also pledged continued opposition.  Albertans see it differently, with Premier Rachel Notley releasing a statement which sees the decision as progress, but not enough to be a victory, and states: “We believe these recommendations and conditions are sound, achievable, and will improve marine safety for all shipping, not just for the one additional tanker a day that results from Trans-Mountain.” It is important to note that not all Albertans are pro-pipeline: Climate Justice Edmonton is protesting with a  “People on the Path” installation along the route, and Extinction Rebellion Edmonton  actively protests fossil fuel development.

Meaningful Indigenous consultation still needed :  The NEB Reconsideration process was triggered by an August 2018 decision of the Federal Court of Appeal, which ordered the NEB to re-examine especially the potential impacts of marine shipping on marine life, and the potential damages of an oil spill. The Reconsideration report has resulted in 16 new recommendations on those issues, along with the existing 156 conditions.   Although the final decision on the project rests with Cabinet, the issue of meaningful Indigenous consultation is still outstanding from the order of the Court of Appeal.  According to the CBC, “Ottawa has met already with three-quarters of Indigenous communities during Trans Mountain consultation reboot” as of Feb. 20, but also according to the CBC, the Union of B.C. Indian Chiefs says “We still say no to the project. tiny house warriorsEven if one nation, one community says no, that project is not happening”  . And the Tiny House Warriors  continue to occupy buildings along the pipeline path, to assert their authority over the land.

Canada ignores GHG impacts while Australia rules against a coal mine on GHG grounds….  A motion was brought by the environmental group Stand.earth, demanding that the NEB reconsideration of Trans Mountain include consideration of its upstream and downstream greenhouse gas emissions, as had been done in the Energy East consultation. Stand.earth stated: “The board cannot possibly fulfill its mandate of determining whether the project is in the public interest without considering whether the project is reconcilable with Canada’s international obligations to substantially reduce GHG emissions.” An article in the National Observer,   “IPCC authors urge NEB to consider climate impacts of Trans Mountain pipeline expansion” summarizes the situation and quotes Tzeporah Berman, international program director at Stand.earth, as well as Marc Jaccard and Kirsten Zickfeld, two professors from Simon Fraser University.  On February 19, the National Energy Board ruled on the Stand.earth motion, refusing to expand the scope of their reconsideration. Council of Canadians reacted with  “NEB climate denial another Trudeau broken promise”  .

It is doubly disappointing that Canada’s National Energy Board declined to include climate change impacts in its assessment, in the same month that the Land & Environment Court of New South Wales, Australia upheld the government’s previous denial of a permit for an open cut coal mine.   According to a report in The Guardian,     the decision explicitly cited the project’s potential impact on climate change, writing that an open-cut coalmine in the Gloucester Valley “would be in the wrong place at the wrong time.… Wrong time because the GHG [greenhouse gas] emissions of the coal mine and its coal product will increase global total concentrations of GHGs at a time when what is now urgently needed, in order to meet generally agreed climate targets, is a rapid and deep decrease in GHG emissions.”  The decision was also covered in: “Court rules out Hunter Valley coal mine on climate change grounds” (Feb. 8) in the Sydney Morning Herald, and from the  Law Blog of Columbia University: “Big Climate Win Down Under: Australian Court Blocks Coal Mine Citing Negative Impacts of Greenhouse Gas Emissions”.