When TransCanada officially announced it was abandoning the Energy East project, which would have transported 1.1 million barrels of oil per day to the East Coast, a significant amount of discussion took place in the days that followed, suggesting the pipeline quagmire could push the country toward a constitutional crisis.
That prediction took one step closer to reality last week, when Kinder Morgan Canada filed a notice of motion regarding its Trans Mountain expansion project, challenging the City of Burnaby on constitutional grounds as it seeks to block the project’s advancement by delaying the issuance of permits.
There is no way Burnaby should be doing this.
The project has received the requisite approvals — even after additional reviews and assessments — from the National Energy Board and the federal government. Since when is that not enough for the public, or other governing jurisdictions, to rely on?
It’s instructive to look at the TMX project in the context of what is going on in China.
It is a country on the move — spending billions in infrastructure to facilitate investment, development and opportunity. There might be valid disagreement about methods and process, but there is a goal and a plan; to become an economic powerhouse and eventually establish the yuan as the global reserve currency.
And in Canada, we can’t even get a pipeline built that would be important for economic growth and business investment.
No, the building of the Three Gorges Dam wasn’t pretty — but it now generates 22,400 megawatts of much-needed, clean electricity. Still, that’s only two per cent of the country’s electricity needs. That presents a huge opportunity for Canada to supply China with liquefied natural gas – but we’re stalled in that department, too.
This is all about playing for the long game, something China has figured out but Canada has long forgotten.
There is no denying the challenges in a “command and control” economy — but our system of laws, contracts and approvals should be enough to move projects, such as TMX, forward.
Burnaby, in failing to grant Trans Mountain the required permits, and which were part of the comprehensive review process that took place at the NEB and on which the federal cabinet relied, is grasping at straws, not to mention causing additional delays.
Here’s why:
Municipalities exist by virtue of provincial legislation. And there is established case law that shows when there is a conflict between federal and provincial laws, federal law takes precedence.
The notice of motion submitted by Trans Mountain to the NEB late last month refers to a B.C. Supreme Court ruling in 2016, which stated provincial governments must issue provincially required permits that are necessary to carry out a federal undertaking; failure to do so conflicts with a federal purpose.
And the NEB has jurisdiction to act on behalf of the federal government by virtue of the NEB Act.
It doesn’t get more complicated than that.
The mayor of Burnaby likes hyperbole.
When there were protests against Kinder Morgan conducting geotechnical tests it had been ordered to do, the mayor famously said, “This is war.” The citizens of Syria and Iraq know what war means — Derek Corrigan does not.
When Kinder Morgan Canada chief executive Ian Anderson paid Corrigan a visit last week, the response was that he was being bullied by Anderson.
While Corrigan can technically say Burnaby has not turned down the requests for permits, because it hasn’t, the fact Kinder Morgan has been waiting 22 weeks compared with the standard six-week timeframe clearly suggests the city is obfuscating.
Missing is the understanding that when a project is approved, it includes both approval for the project itself and the timing; they are not mutually exclusive.
As stated in the notice of motion, and supported by prior Supreme Court rulings at both the provincial and national level, “A municipality cannot lawfully deny a permit application for a federal undertaking … allow them to manoeuvre out of their duty to issue permit by imposing unreasonable requirements and delays allows them to impair the core of the federal authority thereby doing indirectly what they cannot do directly ….
“Burnaby is improperly exercising control over whether and when the project (TMX) will proceed. The timing of the project was clearly a part of the public interest determination. This amounts to an unconstitutional exercise of its power.”
As Premier Rachel Notley said this week, when the Alberta government announced it would be intervening at the NEB to force Burnaby to issue the requisite permits to Kinder Morgan, one jurisdiction – and a municipal one at that – has no right to obstruct the construction of a project this important to the country.
But it gets better, because Burnaby and its mayor appear to be suffering from amnesia.
When Kinder Morgan was prevented from carrying out its geotechnical work in 2014, it took similar action: submitted a notice of motion to the NEB seeking an order for Burnaby to allow the geotechnical work to proceed. Then, like now, it included notice of a constitutional question.
The NEB ruled in favour of Kinder Morgan. The work took place.
All this calls into question the response by former justice Thomas Berger submitted this week. Berger is seeking to dismiss the Kinder Morgan request for the timely issuance of permits – but in doing so is blatantly ignoring the fact the timing of the project was part of the national interest determination; Kinder Morgan is seeking certainty of process. One could argue Berger is the reason we have been hamstrung on pipelines since his 1977 report that effectively killed the Mackenzie Valley pipeline.
A constitutional crisis triggered by a pipeline? Sadly, it’s entirely in the realm of possibility.
Deborah Yedlin is a Calgary Herald columnist.
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