The Liberal government will introduce sweeping legislation this week to overhaul the environmental assessment system for major resource projects as it faces fierce opposition in British Columbia to a pipeline approved under the current rules.
Prime Minister Justin Trudeau says the existing system, in which the National Energy Board reviews pipeline proposals, has failed to provide credible outcomes that are broadly trusted by the people who would be affected.
The government indicated on Friday that it will give notice of legislation on Monday, meaning the bill will be tabled later in the week.
Ministers have signalled the government will make a single agency responsible for assessing not only environmental issues, but socioeconomic and Indigenous concerns over major resource projects. The NEB and the Canadian Nuclear Safety Commission – which has responsibility for the nuclear industry – will advise the responsible agency, a source said on Sunday.
As part of the government's effort at reconciliation, Natural Resources Minister Jim Carr and Environment Minister Catherine McKenna have vowed to give Indigenous communities a more robust role in decision-making. Industry officials have said they expect proponents of projects will have to undertake an initial consultation with Indigenous communities whose traditional territories would be affected before formally applying for regulatory approvals.
The legislation will cover major projects that are designated to be within federal jurisdiction, including interprovincial pipelines, mines and offshore oil-and-gas drilling.
In opposition, the Liberals spoke against the former Conservative government's approach to approving pipelines, saying former prime minister Stephen Harper had tilted the field in favour of industry. Environmental groups and First Nations say the review process is divisive and leads to endless court challenges.
However, the Trudeau government approved several major projects, including Kinder Morgan Canada Corp.'s planned expansion of its Trans Mountain pipeline, which was under review when the Liberals took office. Rather than start over, Mr. Carr and Ms. McKenna added an extra round of consultations with First Nations and an analysis of the project's impact on greenhouse gas emissions from the oil sands.
The government approved Trans Mountain in November, 2016, but it faces opposition from the NDP government in British Columbia and several court challenges. At a town hall meeting in Nanaimo on Friday, Mr. Trudeau was jeered when he defended the approval, and vowed to protect B.C.'s coast from the risk of spills from increased tanker traffic.
"It is incomprehensible that the Prime Minister can admit that the system was broken, and call out the former federal government for gutting our environmental laws, yet stand behind his approval of Trans Mountain, a project that was reviewed under this weak, industry-friendly scheme," Jessica Clogg, executive director of West Coast Environmental Law, said on Sunday.
Alberta Premier Rachel Notley is threatening to impose economic sanctions if the B.C. government blocks the Trans Mountain expansion. Ms. Notley has also criticized federal efforts to assess greenhouse gas effects of pipeline proposals, saying the provincial government regulates emissions in the oil industry.
Chris Bloomer, president of the Canadian Energy Pipeline Association, said on Sunday that industry is eager for a process that will provide clarity and timeliness of decisions.
"We'll be concerned if it is a step backwards in terms of a burdensome process," Mr. Bloomer said. "It's in everybody's interest to have clarity and certainty."
He said companies already engage with Indigenous communities while planning pipelines, but would benefit from clearer rules and a commitment from Ottawa to ensure aboriginal groups have the capacity to consult in a meaningful way early in the process.
Ottawa has committed to bring its laws and practices in line with the United Nations Declaration on the Rights of Indigenous People, including their right to exercise free, prior and informed consent over projects that would affect their territory.
Mr. Bloomer said companies want to see how Ottawa defines that right to consent to ensure it does not amount to a veto over a project that would otherwise be deemed to be in the national interest.
Environmental groups say the law should do more than merely require companies to mitigate adverse impact on the environment, but should put the concept of sustainability at the heart of the process. The government should undertake regional assessments and analyze the cumulative effect of development on the ecosystem and local people, a coalition of environment groups urged recently. And it should ensure all activities are consistent with Canada's commitment to reduce greenhouse gas emissions.