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Energy and Resources NEB member’s business ties to TransCanada Corp. queried

The Energy East pipeline is shown on a map during a news conference in Calgary in this Aug. 1, 2013 file photo.

TODD KOROL/REUTERS

A National Energy Board member has come under renewed fire over his role on an environmental review panel assessing TransCanada Corp.'s proposed Energy East pipeline.

In a filing with the board, Nature Canada is raising questions about Jacques Gauthier's impartiality because he is a former chief executive officer of an energy services company that has done business with TransCanada.

Mr. Gauthier headed LVM Inc. until October, 2012, just prior to the announcement of his appointment to the NEB by the former Conservative government. In 2013, LVM won a contract to do geotechnical work assessing a proposed Energy East river crossing near Ottawa.

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"Nature Canada has further concerns with Member Gauthier's impartiality in the NEB's Energy East review proceedings" as a result of his past business role, its executive director, Eleanor Fast, said in a letter to the board this week.

Mr. Gauthier wrote to Nature Canada earlier this year saying he had no role in negotiating the Energy East contract, no further interest in LVM and no conflict of interest. The conservation group first raised the issue privately with the Minister of Natural Resources in February.

After raucous protests disrupted the first day of the Energy East hearings in Montreal this week, the NEB suspended proceedings, saying it needed to deal with the allegations of bias against Mr. Gauthier and board vice-chair Lyne Mercier.

The panel members had met privately last year with a number of stakeholders in Quebec, including former premier Jean Charest, who was on contract as a consultant for TransCanada. Issues involving Energy East were raised at those meetings, and pipeline opponents argue that it was highly improper for panel members to discuss the project outside the quasi-judicial process established by the board.

The delay and challenge to the NEB's credibility underscore TransCanada's battle in winning approval for the $15.7-billion Energy East pipeline, which would carry 1.1 million barrels of western crude to eastern refineries and an export terminal in Saint John.

The NEB will make recommendations to the government at the end of the hearing process, but the Liberals face widespread opposition to it from municipal politicians, including Montreal Mayor Denis Coderre, First Nations leaders and environmentalists.

In a statement issued on Friday, Natural Resources Minister Jim Carr said Canadians expect to have confidence in institutions like the NEB, the independence and impartiality of which are fundamental principles.

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"We hope the situation involving the Energy East hearings will resolve immediately to allow the process to continue so Canadians can voice their point of view on the important national topic," he said.

Nature Canada first raised the issue of Mr. Gauthier's corporate past last February in a letter to Mr. Carr, urging his office to look into whether there was a conflict of interest. Natural Resources Canada instead suggested that the National Energy Board would deal with the complaint.

In an interview, Nature Canada lawyer Stephen Hazell said that by refusing to intervene then and now, the government has failed in its commitment to re-establish confidence in the NEB.

NEB spokesman Marc Drolet said the board would be dealing with the conflict-of-interest allegation, but he pointed to the letter Mr. Gauthier sent to Nature Canada in March, denying that there was any impropriety.

In the letter, Mr. Gauthier noted that the NEB has strict conflict-of-interest guidelines to which members must adhere.

He said he had had no role in negotiating the LVM contract, and had no further ties to the company.

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"I will be proud to continue to serve on the Energy East panel," he concluded.

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