Whether Kinder Morgan’s Trans Mountain pipeline expansion is constructed or not, the B.C. government intends to pursue the authority to restrict the transportation of diluted bitumen, saying it intends to combat an increasing volume of oil moving by rail across the province.
More than 150,000 barrels of oil are moved each day on British Columbia’s railways, carrying Alberta oil to export markets. The province is just starting to collect the data on how much oil is moving by rail, but believes the increase since 2012 is significant.
“We believe there is much we can do to protect the B.C. environment and the economy,” Environment Minister George Heyman said Thursday in the legislature. “Railways are a federal responsibility, but impacts off the rail line, from carrying of goods, can be regulated by the B.C. government, have been regulated by the B.C. government and will continue to be regulated as appropriate by the B.C. government.”
British Columbia triggered a trade war with Alberta in January when it announced plans to consult on regulations to restrict increased oil transportation – a measure that was seen as an attack on the proposed $7.4-billion Trans Mountain project that would get Alberta’s land-locked oil resources to new overseas markets.
B.C. then sought to cool the dispute by promising to shelve the proposed regulations, while asking the courts to clarify its jurisdiction.
Mr. Heyman said this week that he expects to release the question the government will refer to the courts in the next few weeks. Both interprovincial pipelines and railways are federal jurisdiction, but B.C. argues it still has the authority to regulate limits on the increase of diluted bitumen transportation.
B.C. says the courts have already established that the province has joint responsibility with Ottawa for the environment when oil transportation crosses provincial borders.
The province is relying on a ruling from the Supreme Court of B.C. in January, 2016, in a case involving a different oil pipeline.
In that case, the court found that the province had wrongly ceded to the federal government its responsibility for assessing the environmental impact of the proposed Northern Gateway oil pipeline. That decision forced the province to conduct its own environmental assessment of the Kinder Morgan pipeline.
The Supreme Court of B.C. concluded that “to disallow any provincial regulation over the project because it engages a federal undertaking would significantly limit the Province’s ability to protect social, cultural, and economic interests in its lands and waters.”
The court ruling continued: “It would go against the current trend in the jurisprudence favouring, where possible, co-operative federalism.”
However, the opposition BC Liberals have argued this week that the movement of oil between provinces is clearly within Ottawa’s jurisdiction – and the province’s opposition to the Kinder Morgan pipeline will only force more crude oil to be transported by the riskier path of railway.
Liberal MLA Mike de Jong, who can watch oil cars whipping by on the CN mainline track from his living room in his Abbotsford, B.C., home, said the government knows but won’t admit to the public that its plans to refer the jurisdiction question to the courts is bound to end in failure for B.C.
“It is disingenuous, in the extreme, for the Premier to suggest that what he is hoping to achieve from the courts is a declaration that the province can regulate the volume of a product travelling either on a federally regulated rail line or in a federally regulated pipeline,” Mr. de Jong said in an interview. “There is not a snowball’s chance in hell that he is going to receive that declaration.”
The Liberals are accusing the BC NDP government of waging a war on the Kinder Morgan pipeline project that is not based on upholding the law, but will result in investors bailing out.
Kinder Morgan announced on Sunday it is halting all non-essential construction on the pipeline, saying it will cancel the project by May 31 if the risks created by B.C.’s opposition are not removed.