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A ship receives its load of oil from the Kinder Morgan Trans Mountain Expansion Project's Westeridge loading dock in Burnaby, British Columbia, on June 4, 2015.JONATHAN HAYWARD/The Canadian Press

The federal government will not require consent from First Nations as it makes a decision on whether to approve Kinder Morgan Inc.'s Trans Mountain pipeline expansion, despite endorsing a UN declaration earlier this year that includes the principle of "free, prior and informed consent," Natural Resources Minister Jim Carr said Thursday.

Mr. Carr released a report from an advisory panel that noted many First Nations and Métis communities in British Columbia feel they have not been adequately consulted on the $6.8-billion expansion and insist they have the right to veto resource projects on their traditional territory.

Mr. Carr has said the government will make a decision on Trans Mountain before Christmas. Alberta Premier Rachel Notley has demanded that Ottawa approve the pipeline expansion in order to provide a boost to the depressed oil industry in her province.

But the panel heard from many indigenous communities and other residents and local politicians in B.C. who remain adamantly opposed. First Nations have successfully launched legal challenges against other resource projects, notably Enbridge Inc.'s Northern Gateway pipeline, though the legal test has typically been whether they were adequately consulted, not whether they gave consent.

"We believe that to meaningfully consult and accommodate indigenous peoples in the context of these energy reviews is the principal responsibility of the government of Canada," Mr. Carr told reporters in Ottawa. "That's what we have done and that is what we will continue to do."

The minister's comments appear to clear one obstacle from the path of approval: ongoing opposition from some First Nations. Environmentalists fear the Liberals will approve the pipeline expansion as part of a broader deal to win Ms. Notley's support for a pan-Canadian climate strategy.

In the spring, the Liberal government endorsed the United Nations Declaration on the Rights of Indigenous People, which spells out the inherent right of such people to provide consent when projects impact their territories or rights.

The advisory group – ordered after the National Energy Board recommended conditional approval – noted the Union of British Columbia Indian Chiefs invoked that right with regard to the Kinder Morgan project. The three-person panel also raised questions about Kinder Morgan's claim that more than 40 aboriginal organizations support the pipeline. They noted many community leaders signed statements of support in order to avoid being left out of any benefit that flows if the project was approved.

The report also highlighted the bitter divide between people in Alberta and British Columbia over the benefits and costs of the project, though neither province had a single view. That split presents a major political challenge for the federal Liberals, who will face bitter recriminations either in Alberta or in B.C. depending on the decision.

The majority of Albertans who made submissions to the panel were "impatient" with the extended process, and eager to see the pipeline approved to give a boost to their economy. If oil prices rise, additional pipeline capacity will be needed to get new crude supply to market, while if prices stay flat, the access to new markets is seen as critical by the industry and Ms. Notley.

In B.C., residents in the Lower Mainland were overwhelmingly opposed to the pipeline project, including the mayors of Burnaby and Vancouver. The advisory panel noted that some residents felt let down by the federal government because, they argued, Prime Minister Justin Trudeau had promised a whole new review process for the project prior to the election and then failed to deliver.

In a speech in Vancouver on Thursday, Kinder Morgan Canada president Ian Anderson said the company has a lot of work to do before it can break ground on the project, even if Ottawa grants its approval.

That includes meeting 157 conditions recommended by the National Energy Board.

"We're nowhere near 'yes' yet," he said. "We're working hard to get to 'yes.'"

Mr. Anderson said many indigenous leaders do support the project and will enjoy benefits that flow from it, but have not spoken up. "Know that we have a strong measure of support from First Nations communities along the right of way," he said.

Follow Shawn McCarthy on Twitter: @smccarthy55Opens in a new window

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