Pro-pipeline rally at Alberta legislature, addressed by Economic Development Minister Deron Bilous, April 18, 2018. (Chris Schwarz/Alberta government)

B.C. VIEWS: Justin Trudeau left himself no choice on pipeline

Federal Liberals undermined National Energy Board, then realized the cost

“I long for the days of Stephen Harper,” B.C. Green leader Andrew Weaver said when he heard the news that the Justin Trudeau government had agreed to buy the 65-year-old Trans Mountain pipeline.

Weaver wasn’t kidding. “At least you knew where he stood,” he explained, contrasting that with Trudeau’s spinning weathervane of positions on Alberta’s oil industry.

While campaigning in 2015, Trudeau talked frequently about what he called the flawed National Energy Board hearings that approved Trans Mountain. But after forming government, his cabinet approved it too.

The Trudeau government then launched a promised overhaul and renaming of the NEB. Changes include opening up hearings to even more stacking by organized opponents than we saw with Northern Gateway and Trans Mountain.

As a result, this may be the last major Canadian oil pipeline ever approved, which is at least consistent with Trudeau’s recent musing in Europe that he wishes he could phase out Canada’s oil industry sooner.

Trudeau set the stage for nationalizing Trans Mountain by cancelling Northern Gateway to Kitimat, with his glib line about the “Great Bear Rainforest” being no place for oil tankers. Not just Alaska crude tankers but large ships of all sorts ply the waters off B.C.’s coast, and the Trans Mountain expansion is the main way to finance additional marine protection that everyone agrees is needed, pipeline or no pipeline.

Kinder Morgan Canada committed $150 million to improve the capacity of Western Canada Marine Response Corp., the industry-funded agency that works with the Coast Guard to prevent and clean up spills. I’m advised that the federal takeover means work can resume on this, after Kinder Morgan suspended financing.

WCMRC plans include response bases at Burrard Inlet, on the Lower Fraser River, Nanaimo, Port Alberni, Sidney, Beecher Bay in the Juan de Fuca Strait, as well as an offshore supply vessel to be based at Ogden Point in Victoria. This is in addition to heavy rescue tugs and other Coast Guard improvements Trudeau announced with his original decision to proceed with Trans Mountain.

You’re a part owner of the pipeline, for now at least, but you don’t have to pay for the new spill response plan. That money comes from charges on the shippers of oil.

The deal worked out by Ottawa means Canadian taxpayers own the existing pipeline, the storage and terminal facilities at Burnaby, and the expansion project in its current state, including new pipeline installed years ago in Alberta without protest.

You are also part owner of large stacks of new pipe for the project, sitting at the railside near Kamloops. Kinder Morgan agreed to continue managing the project, so part of the purchase price is a management fee.

That’s what we get for the $4.5 billion price tag, the pipeline-related assets. The cost of the expansion, pegged at $7.4 billion before the latest round of uncertainty and political battles, is to be financed by Ottawa. So call it $12 billion for now.

You should also know that Kinder Morgan hasn’t agreed to sell all of its assets in Canada. As CEO Steve Kean told analysts on an investor conference call last week, Kinder Morgan retains its Vancouver wharves terminal, the largest mineral concentrate import-export facility on the west coast of North America.

And if you really don’t want this pipeline expansion to continue, consider this. Kinder Morgan owns the largest crude storage and rail loading terminal in North America, at Edmonton. In the absence of pipeline capacity, the rate of crude oil traveling across B.C. by rail can only continue to rise.

Tom Fletcher is B.C. legislature reporter and columnist for Black Press. Email: tfletcher@blackpress.ca


@tomfletcherbc
tfletcher@blackpress.ca

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