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Feds to delay pipeline project decisions in wake of interim environmental assessment measures

28th January 2016

By: Henry Lazenby

Creamer Media Deputy Editor: North America

  

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VANCOUVER (miningweekly.com) – The Liberal Canadian government on Wednesday said it would delay decisions on Kinder Morgan’s Trans Mountain Expansion Project and TransCanada’s Energy East pipeline project in order to implement five new temporary measures as the first step of a broader strategy to “review and restore confidence” in Canada’s environmental assessment processes, particularly when it comes to critical new oil and gas pipeline projects.

Making headway on fulfilling election campaign promises, the federal Environment and Climate Change Minister Catherine McKenna and Natural Resources Minister Jim Carr stated that the temporary measures were intended to provide greater certainty on how government would be guided in applying its discretionary decision-making authorities for projects being assessed during the review of environmental assessment processes.

The two oil pipeline projects were currently under review by the National Energy Board (NEB) and government stated that it was taking immediate steps to ensure consistency with the new measures.

Minister Carr would seek to extend the legislated time limit for government’s decision regarding the Trans Mountain Expansion Project by four months to seven months in total, to make room for the set of new measures to be assessed.

The temporary measures imposed on the project entailed the Natural Resource Ministry undertaking deeper consultations with indigenous peoples and providing funding to support participation in these consultations; assess the upstream greenhouse-gas (GHG) emissions associated with this project and make this information public; and, appoint a ministerial representative to engage communities, including Indigenous communities potentially affected by the project, to seek their views and report back.

Minister Carr would also seek to delay government’s legislated review time on the hotly debated Energy East pipeline by six months, to a total of 21 months, and would seek an extension to the legislated time limit for a decision by three months, to a total of six months.

The government assured project proponents that no one would be asked to return to the starting line, and project reviews would continue within the current legislative framework and according to treaty provisions, under the auspices of relevant responsible authorities and Northern regulatory boards.

Decisions would be based on science, traditional knowledge of indigenous peoples and other relevant evidence; the views of the public and affected communities would be sought and considered; indigenous peoples would be meaningfully consulted and, where appropriate, impacts on their rights and interests would be accommodated; and direct and upstream GHG emissions linked to the projects under review would be assessed.

As stated in the throne speech by Prime Minister Justin Trudeau, government would introduce new environmental assessment processes to restore public trust and foster greater transparency.

Government explained that it would aim to demonstrate to Canadians and to the world that a clean environment and a strong economy went hand in hand. “Protecting the environment and growing the economy are not incompatible goals; in fact, our future success demands that we do both,” stated government.

Addressing climate change in Canada would require collaboration with Canada’s provinces and territories to incorporate GHG emissions in environmental assessment processes and as part of a national climate change framework. To inform these processes, upstream GHG emissions associated with projects under review would also be assessed. 

RESISTANCE
The British Columbia provincial government earlier this month stressed that it could not support Kinder Morgan’s Trans Mountain Expansion Project based on information submitted to the NEB panel reviewing the project.

The provincial government stated on Monday that, during the course of the NEB review, the company had not provided enough information about its proposed spill prevention and response for the province to determine if it would use a world-leading spills regime.

Because of this, the province said it was unable to support the project at this time, based on the evidence submitted.

Trans Mountain has proposed an expansion of its existing 1 150 km pipeline that spans Strathcona County (near Edmonton), Alberta and Burnaby, in British Columbia. The proposed expansion, if approved, would create a twinned pipeline that would increase the nominal capacity of the system from 300 000 bbl/d, to 890 000 bbl/d.

Energy East is a proposed 4 600 km pipeline that would stretch from Alberta to an export terminal in New Brunswick, and would be able to carry up to 1.1-million barrels of crude oil a day.

The pipeline would be built by converting an existing natural gas pipeline to one suited for oil transportation, and constructing new sections of pipeline to complete the route.

Canada's Athabasca oil sands are large deposits of bitumen, or extremely heavy, tarry crude oil, located in north-eastern Alberta, roughly centred on the boomtown of Fort McMurray. Canada holds the world’s third-largest oil reserves.

Canada remains the most important crude supplier to the US, which is unlikely to change in the foreseeable future. However, Canadian producers receive a discount on the US benchmarked oil price, owing to the industry's lack of access to global markets. It is imperative that new pipeline projects move more energy to east Canada, as well as offshore to the north, through hazardous Arctic waters, or to the west coast, which is complicated for environmental and social acceptability reasons.

RESPONSE
Environment-focused nongovernmental organisation the Pembina Institute welcomed the federal government's temporary principles.

Federal policy director Erin Flanagan stated that the principles demonstrated that Ottawa was committed to improving the ways in which fossil fuel infrastructure was evaluated.

“The requirement to consider direct and upstream carbon pollution in regulatory reviews acknowledges a long-standing deficiency in Canada’s regulatory framework for fossil fuel projects. Approving projects that facilitate emissions growth across Canada is not in the public interest in the absence of a credible plan to meet the country’s climate change commitments. Canada will now assess how infrastructure investments support long-term prosperity in a world transitioning to renewable energy,” said Flanagan.

She also urged government to establish a science-based climate plan that included minimum standards on carbon pricing, and that built on existing provincial action. “Existing provincial climate commitments will not ensure that Canada meets its 2030 emissions reductions goal, and are not sufficient to ensure Canada lives up to its fair share of the Paris Agreement,” Flanagan opined.

Edited by Samantha Herbst
Creamer Media Deputy Editor

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