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Trans Mountain, Trudeau and the B.C.-Alberta feud: A guide to the political saga so far

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  • The Trudeau government has ordered the National Energy Board to look again at its decision on the Trans Mountain pipeline expansion, taking extra marine traffic and the impact on killer whales into account to address the concerns of a federal court that blocked the project last month.
  • Natural Resources Minister Amarjeet Sohi did not give a timeline for consultations with First Nations, but said Ottawa would be outlining a plan to re-engage with Indigenous people at a later date.
  • On Aug. 30, the government lost a decision at the Federal Court of Appeal that quashed Trans Mountain's environmental approval, sending the project back to the National Energy Board. The federal government has said it still intends to proceed with the pipeline, which it bought from Kinder Morgan for $4.3-billion in a purchase approved last week. But Prime Minister Justin Trudeau has been cagey about what the new timetable for construction will be, saying Ottawa needs to do "a little more work" to revive the project.
  • First Nations, environmental groups and B.C. politicians hailed the unanimous court decision, which instructed Ottawa to consult more with Indigenous people. But Alberta Premier Rachel Notley responded by pulling support for the federal carbon-pricing strategy, cancelling planned increases in carbon taxation in 2021-22.

Feb. 8, 2018: A boat pulls a boom at the Kinder Morgan Westridge Marine Terminal in Burnaby, B.C., at the terminus for the Trans Mountain pipeline from Alberta.

DARRYL DYCK/The Globe and Mail

What is Trans Mountain?

Pipeline basics: The Trans Mountain pipeline system has carried Alberta’s oil to the B.C. coast since 1953, and can currently carry about 300,000 barrels of oil per day. The pipeline is owned by the Texas-based company Kinder Morgan, which has been trying since 2012 to build a new pipeline along the existing one, boosting its capacity to 890,000 barrels a day. The $7.4-billion expansion project would thread about 1,000 kilometres of new pipe from Edmonton to Burnaby, B.C.

Legend

National parks

Existing pipeline

Parks

Expansion pipeline

Terminal

Indigenous lands

Pump station

Edmonton

0

80

KM

Jasper

National

Park

BRITISH

COLUMBIA

ALBERTA

Banff

National

Park

Calgary

Kamloops

Kelowna

Westridge

Van.

Sumas

Burnaby

Ferndale

WASH.

IDAHO

MONT.

Anacortes

MURAT YÜKSELIR AND JOHN SOPINSKI / THE GLOBE

AND MAIL, SOURCE: TILEZEN; OPENSTREETMAP

CONTRIBUTORS; HIU; NATURAL RESOURCES CANADA;

OPEN GOVERNMENT; GRAPHIC NEWS; KINDER MORGAN

Legend

0

80

KM

Existing pipeline

ALBERTA

Expansion pipeline

Edmonton

Indigenous lands

National parks

Parks

Jasper

National

Park

Terminal

Pump station

Banff

National

Park

Calgary

BRITISH COLUMBIA

Kamloops

Kelowna

Westridge

Vancouver

Sumas

Burnaby

WASH.

IDAHO

MONT.

Ferndale

Pacific

Ocean

Anacortes

MURAT YÜKSELIR AND JOHN SOPINSKI / THE GLOBE AND MAIL

SOURCE: TILEZEN; OPENSTREETMAP CONTRIBUTORS; HIU;

NATURAL RESOURCES CANADA; OPEN GOVERNMENT; GRAPHIC

NEWS; KINDER MORGAN

Legend

Edmonton

Existing pipeline

Expansion pipeline

16

ALBERTA

Indigenous lands

Jasper

National

Park

National parks

Parks

2

Terminal

Pump station

97

Banff

National

Park

Calgary

1

BRITISH

COLUMBIA

Kamloops

Vancouver

Island

Kelowna

Westridge

Sumas

Vancouver

Burnaby

Pacific

Ocean

Ferndale

WASH.

IDAHO

MONT.

0

80

Anacortes

KM

MURAT YÜKSELIR AND JOHN SOPINSKI / THE GLOBE AND MAIL, SOURCE: TILEZEN; OPENSTREETMAP

CONTRIBUTORS; HIU; NATURAL RESOURCES CANADA; OPEN GOVERNMENT; GRAPHIC NEWS; KINDER MORGAN

Wasn’t it approved? The federal government gave Kinder Morgan the go-ahead for its pipeline expansion in 2016, while at the same time scuttling another planned Alberta-to-B.C. pipeline, Enbridge’s Northern Gateway. Then in August, the Federal Court of Appeal quashed that approval, saying Ottawa would need to do more consultations with Indigenous people. Not all First Nations along the Trans Mountain route have given consent to the expansion, and most oppose it, fearing an increased risk of oil spills and water pollution. The project isn’t a politically popular one in B.C. either: Vancouver-area residents worry that the extra marine traffic – a sevenfold increase in oil tankers in one of the world’s busiest ports – is a recipe for an Exxon Valdez-style disaster.

Why did Kinder Morgan stop building it? Hoping to force the province’s hand, Kinder Morgan announced on April 8 that it would suspend all “non-essential” spending on the project unless it can reach an agreement with the B.C. government by May 31. Without a deal, “it is difficult to conceive of any scenario in which we would proceed with the project,” Kinder Morgan CEO Steve Kean said. On May 15, Finance Minister Bill Morneau offered to indemnify Kinder Morgan against losses due to B.C.’s political action, but Mr. Kean said in a statement that his company was “not yet in alignment” with government and the May 31 deadline was still in effect.

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Who is in charge of it now? On May 29, two days before Kinder Morgan’s deadline, Mr. Morneau announced that Ottawa would buy the project and bring it to completion under a Crown corporation. Mr. Morneau said the government didn’t plan on being a long-term owner of the project, saying Ottawa would look for new investors to eventually take the reins. Kinder Morgan shareholders approved the federal purchase plan on Aug. 30, the same day as the court decision against the pipeline’s environmental approval. The Prime Minister has said Ottawa is still committed to the Trans Mountain expansion, and on Sept. 21 his Natural Resource Minister, Amarjeet Sohi, announced that there would be a new NEB review of the application due in 2019.

Interactive: A visual guide to Trans Mountain's impact on tanker traffic

In depth: A behind-the-scenes look at how the Trans Mountain deal was done

Who‘s for it, who’s against it

Stewart Phillip, Grand Chief of the Union of British Columbia Indian Chiefs, gives a news conference with Indigenous leaders and politicians opposed to the Trans Mountain expansion on April 18, 2018.

Darryl Dyck/The Associated Press

First Nations: While some Indigenous nations have signed agreements supporting Trans Mountain, many more are immovably opposed, arguing that the pipeline endangers their environmental rights and traditional lands. Indigenous protesters have vocally opposed the pipeline and warn that a Standing Rock-style confrontation could erupt if it goes ahead. Stewart Phillip, head of the Union of B.C. Indian Chiefs, co-wrote an opinion piece for The Globe and Mail that said forcing the pipeline through would mean “setting Canada up for another catastrophic crisis on the same level as Oka.”

B.C.: Last year, B.C.’s NDP came to power supported by the provincial Green Party, and promised to kill the Kinder Morgan project, which the previous Liberal government had approved. Premier John Horgan has said that, whether the expansion is built or not, B.C. will press for authority to block diluted bitumen from being shipped across the province by rail.

Alberta: Premier Rachel Notley’s political future depends on the Trans Mountain pipeline, whose revenues are essential to the NDP government’s plans to get back to balanced budgets. She’s said the province is willing to pick up the tab for Trans Mountain to make sure it goes ahead. Her government also gave itself new powers to restrict how fossil fuels are shipped out of the province, a potentially powerful weapon to tighten B.C.’s oil supply and put pressure on it to stop opposing Trans Mountain (more on that below).

Federal government: Prime Minister Justin Trudeau promised financial backing and legislation to make sure Trans Mountain goes ahead, including indemnifying Kinder Morgan against “unnecessary delays that are politically motivated.” But after negotiations with Kinder Morgan, the federal government announced that it would take over the project.

What’s at stake: Alberta-B.C. trade at a glance

Fossil fuels, and services related to their extraction, form a major part of trade between the western provinces. The dispute over Trans Mountain could have far-reaching effects on the price of gas, jet fuel and other products.

But a catastrophic rise in prices is an improbable outcome, analyst Michael Ervin told The Globe and Mail: If Alberta started throttling B.C.’s oil supply, gasoline supplies from the United States and Asia could make up the difference, likely producing a 10-cent-a-litre price increase, Mr. Ervin said.

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INTERPROVINCIAL EXPORTS, B.C

AND ALBERTA, 2014

Goods and services, in millions of dollars

ALBERTA

Total exports: $73,610

B.C.

Total exports: $39,957

Alta.

$17,644

Ont.

$27,369

Ont.

$12,007

B.C.

$16,752

Sask.

$12,731

Que.

$4,157

Que.

$6,350

Sask.

$2,158

Man.

$5,356

Man.

$1,493

Atlantic

$1,529

Atlantic

$3,524

Territories

$1,527

Territories

$968

TOP 5 EXPORTS TO ALBERTA

TOP 5 EXPORTS TO B.C.

Natural gas

$2,277

Support services for

oil and gas extraction

(except exploration)

$2,088

Architectural,

engineering

and related services

$651

Diesel and

biodiesel fuels

$1,582

Conventional crude oil

$632

Conventional crude oil

$1,207

Prepared meals

$628

Gasoline

$1,161

Wholesale margins -

machinery, equipment

and supplies

$501

Fresh and frozen

beef and veal

$554

MURAT YÜKSELIR / THE GLOBE AND MAIL

SOURCE: STATISTICS CANADA

INTERPROVINCIAL EXPORTS, B.C

AND ALBERTA, 2014

Goods and services, in millions of dollars

ALBERTA

Total exports: $73,610

B.C.

Total exports: $39,957

Alta.

$17,644

Ont.

$27,369

Ont.

$12,007

B.C.

$16,752

Sask.

$12,731

Que.

$4,157

Que.

$6,350

Sask.

$2,158

Man.

$5,356

Man.

$1,493

Atlantic

$1,529

Atlantic

$3,524

Territories

$1,527

Territories

$968

TOP 5 EXPORTS TO ALBERTA

TOP 5 EXPORTS TO B.C.

Natural gas

$2,277

Support services for oil

and gas extraction

(except exploration)

$2,088

Architectural, engineering

and related services

$651

Diesel and biodiesel fuels

$1,582

Conventional crude oil

$632

Conventional crude oil

$1,207

Prepared meals

$628

Gasoline

$1,161

Wholesale margins -

machinery, equipment

and supplies

$501

Fresh and frozen

beef and veal

$554

MURAT YÜKSELIR / THE GLOBE AND MAIL

SOURCE: STATISTICS CANADA

INTERPROVINCIAL EXPORTS, B.C AND ALBERTA, 2014

Goods and services, in millions of dollars

ALBERTA

Total exports: $73,610

B.C.

Total exports: $39,957

Alta.

$17,644

Ont.

$27,369

Ont.

$12,007

B.C.

$16,752

Que.

$4,157

Sask.

$12,731

Sask.

$2,158

Que.

$6,350

Man.

$1,493

Man.

$5,356

Atlantic

$3,524

Atlantic

$1,529

Territories

$968

Territories

$1,527

TOP 5 EXPORTS TO ALBERTA

TOP 5 EXPORTS TO B.C.

Natural gas

$2,277

Support services for oil and gas

extraction (except exploration)

$2,088

Architectural, engineering

and related services

$651

Diesel and biodiesel fuels

$1,582

Conventional crude oil

$632

Conventional crude oil

$1,207

Prepared meals

$628

Gasoline

$1,161

Wholesale margins - machinery,

equipment and supplies

$501

Fresh and frozen beef and veal

$554

MURAT YÜKSELIR / THE GLOBE AND MAIL, SOURCE: STATISTICS CANADA

What Alberta’s been doing

Alberta Premier Rachel Notley.

Justin Tang/The Canadian Press

Shortly after the Aug. 30 court ruling against the pipeline approval, Ms. Notley pulled the plug on Alberta’s planned carbon-tax increases, saying its support for the federal climate-change plan hinged on Trans Mountain’s eventual completion. “Alberta has done everything right and we have been let down,” the Premier said of the court ruling. “It’s a crisis."

On the interprovincial front, the Notley government introduced Bill 12, the Preserving Canada’s Economic Prosperity Act, which gives the province broad authority over how oil is shipped out of Alberta, and to where. The law, which Alberta’s legislature voted to pass on May 15, allows the province to:

  • Force companies to get a licence before exporting fossil fuels by pipeline, rail or truck
  • Let the Energy Minister set maximum daily amounts of fossil fuels to be exported
  • Let the Energy Minister decide whether export licences are in Alberta's best interests and maintain supply for provincial needs
  • Fine companies up to $10-million a day, and individuals up to $1-million a day, if they break the new law

In theory, the province could use the law in targeted ways that would tighten oil exports to B.C., driving up prices for fuel and other products.

What B.C.'s been doing

British Columbia Premier John Horgan.

DARRYL DYCK/The Canadian Press

British Columbia has promised to seek an injunction against Alberta’s Bill 12, which B.C. Attorney-General David Eby has described both as an unconstitutional law and “a bluff” that Ms. Notley’s government was unlikely to ever use. But in the meantime, B.C. could find ways to retaliate with trade measures of its own, similar to how Alberta once temporarily barred imports of B.C. wine back in February over the Trans Mountain dispute.

Mr. Horgan’s government also wants a court reference to clarify whether B.C. can regulate transportation of bitumen through the province, but the Premier has said he’ll stand down if the court rules against him. The province filed its case at the B.C. Supreme Court of Appeal on April 26.

B.C. Premier John Horgan, Prime Minister Justin Trudeau and Alberta Premier Rachel Notley meet in Mr. Trudeau's office on Parliament Hill on April 15, 2018.

Justin Tang/The Canadian Press

What’s at stake for Ottawa, and what it could do next

The Trudeau government’s decision to buy Trans Mountain has now made it a lightning rod for the criticism and costs of the project. Here’s what that means, and what other issues are at play.

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Owning the pipeline: The Kinder Morgan gives the government ownership of the existing pipeline, rights of way along the route and the marine terminal in Burnaby. But once the expansion is built, the government doesn’t plan to be the pipeline’s proprietor for long: It is in negotiation with investors – including Indigenous communities, pension funds and the Alberta government – to eventually take over management of the pipeline.

Indigenous issues: Mr. Trudeau’s government has repeatedly said Indigenous reconciliation is a priority, but the standoff with B.C. First Nations over pipelines is putting that rhetoric to the test.

Legal authority over energy: The Liberals have promised legislation soon to reassert that the federal government has authority over interprovincial pipelines. But that could have unintended backlashes in other provinces, like Quebec, whose political and regulatory roadblocks helped kill the Energy East pipeline.

Climate change: Supporting Trans Mountain was Ottawa’s tradeoff to win Alberta’s support for a national carbon-pricing plan in 2017. With Trans Mountain stalled again by the Federal Court of Appeal ruling, Alberta says it won’t increase its carbon taxes in 2021-22, as they had planned to do to match the federal plan. A national policy without Alberta would be a fairly toothless one: The province accounted for 38 per cent of Canada’s greenhouse gas emissions in 2015, the most recent year with available data. Meanwhile, the climate plan is in political trouble in Ontario, the second-biggest emitting province, where Premier Doug Ford’s Progressive Conservative government has scrapped his Liberal predecessor’s cap-and-trade policy.

March 10, 2018: Indigenous leaders and environmentalists march in Burnaby in protest against Kinder Morgan's Trans Mountain pipeline.

Nick Didlick/REUTERS

What First Nations and their allies are doing

Court battles: Several Indigenous nations launched legal challenges to the Trans Mountain project, vowing to take it to the Supreme Court if necessary. They cite 2014′s Tsilhqot’in decision by the Supreme Court of Canada, which expanded Indigenous people’s rights of approval over projects on their land. Those challenges gained a major victory with the Federal Court of Appeal’s ruling, which is one of many cases where courts have found Ottawa’s commitment to Indigenous consultation falling short of its constitutional obligations.

Getting in the way: The Secwepemc Nation and Greenpeace have teamed up to build tiny homes in the Trans Mountain expansion’s path, borrowing a strategy from the Standing Rock Sioux people’s opposition to the Dakota Access Pipeline.

Protests in Burnaby: Scores of people, including federal Green Party Leader Elizabeth May, have been arrested since mid-March in protests at Kinder Morgan’s Burnaby Mountain terminal. A protest camp, dubbed Camp Cloud, was set up at the Kinder Morgan’s Burnaby Mountain terminal in November of 2017. Scores of people, including federal Green Party Leader Elizabeth May, were arrested at the site up until August of this year, when the City of Burnaby got a court order to shut the camp down.

Aug. 16, 2018: RCMP and City of Burnaby officials dismantle Camp Cloud.

BEN NELMS/THE CANADIAN PRESS

What happens if the pipeline isn’t built?

Business: Alberta’s oil and gas sector had high hopes for Trans Mountain after other major pipeline projects — Keystone XL, Northern Gateway and Energy East hit political and regulatory roadblocks in Canada and the United States. Now, what looks like a sure bet is a source of ongoing uncertainty, and oil-industry leaders and major Canadian banks have warned that it will make Canada look like a less attractive investing destination. Here’s a deeper look from The Globe’s Jeff Lewis, Kelly Cryderman and Shawn McCarthy about what might happen in the oil patch if Trans Mountain falls apart.

Politics: Both Ms. Notley and Mr. Trudeau are running for re-election in 2019. For Mr. Trudeau, the pipeline dispute between Alberta and B.C. is a test of national unity and his government’s varied commitments to the environment, Indigenous people and opening Canada’s natural resources to global markets. In Alberta, Jason Kenney and the United Conservative Party are ramping up pressure on the Notley and Trudeau governments to force through Trans Mountain no matter what, and failure to do so could weaken both leaders in the province in next year’s elections.

Opinion and analysis

Gary Mason: Trans Mountain pipeline ruling creates a big political mess for Trudeau and Notley

Robert Jago: It’s time to take consultations with First Nations seriously

Andrew Willis: Ottawa stuck with Trans Mountain pipeline other investors wisely rejected

Editorial: The problem isn’t the pipeline, it’s the way it was approved

David Milstead: Pipelines aren’t the cash cows many people think they are

Gary Mason: Justin Trudeau’s Faustian bargain

Mary Janigan: B.C. politicians need a history lesson

Compiled by Globe staff

With reports from Kelly Cryderman, Jeff Lewis, Shawn McCarthy, Brent Jang, Ian Bailey, Justine Hunter and The Canadian Press

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