LIBERALS NOW ON RIGHT LEGAL PATH WITH TMX, BUT OBSTACLES REMAIN
Despite sound strategy, Trudeau has dug deep hole for himself on pipeline expansion
It’s no easy matter to find sanity in the turbulent world of Alberta oil and gas.
Jason Kenney is talking about the need for production quotas on oil companies. Rachel Notley is talking about the government orchestrating new rail cars to move bitumen. And Barack Obama, that vocal advocate for controlling climate change, is bragging that he’s responsible for the United States now being the world’s biggest producer of oil and gas.
“American energy production ... went up every year I was president,” Obama told a Texas audience this week. “Suddenly America’s like the biggest oil producer and the biggest gas. That was me, people.”
Obama’s gloating is maddening, but it’s just one more disconcerting piece of news in the haywire Alberta oil economy, where the problems dwarf anything we have faced in recent decades and corrective solutions are in short supply.
For clarity on several major legal and legislative issues, I went to two experts, law professor Malcolm Lavoie of the University of Alberta and political scientist Tom Flanagan of Calgary, a leading conservative thinker.
I asked both about one notion to get the Trans Mountain Expansion (TMX) built, the Conservative party’s push to have Trudeau’s Liberals approve legislation declaring that TMX is in the national interest. The Liberals recently rejected a Conservative bill which invoked the 1867 Constitution’s declaratory powers that give the federal government power over public works projects it wouldn’t otherwise regulate. Over the decades, these declaratory powers have helped the federal government build everything from railways to nuclear power plants.
The Conservatives argued that asserting federal power in this way would make it easier to build TMX and would likely make it easier for the Liberals to eventually sell off TMX to a private company.
The Liberals countered that the pipeline is already under federal jurisdiction and that the best plan is to simply follow the path set out by the Federal Court of Appeal Justice Eleanor Dawson, who said TMX can still go ahead if the Liberals can get it right this time with First Nations consultation.
Lavoie agrees with the Liberal argument that declaratory powers would not make much difference in TMX getting built.
“It’s not necessarily relevant here in the sense that Parliament already has jurisdiction over interprovincial pipelines,” he says.
Flanagan agrees: “You could pass the resolution (for declaratory powers) and it would be like an exclamation that we’re really serous about doing this, but actually I think the (federal) jurisdiction is there anyway.”
Both Lavoie and Flanagan also note that declaratory powers would not do anything to stop the court-ordered imperative that the federal government must properly consult with First Nations, something the Trudeau Liberals failed to do after taking over the file.
To proceed on TMX, the Trudeau government is now likely on the most practical path, Lavoie says, which is to redo Indigenous consultations.
“In terms of getting the pipeline built as quickly as possible, the idea of simply trying to comply with the Federal Court of Appeal’s decision is probably the quickest way forward.”
If the government had appealed the federal court decision, it would likely have taken longer to move forward and it would also have opened up the federal government to charges it was failing to negotiate in good faith with First Nations, Lavoie says.
“I think there’s a lot to be said for the government’s approach. It seems like their legal strategy is certainly defensible.”
Flanagan is uncertain that the Trudeau Liberals are truly honest about their desire to see the pipeline built, but he agrees with Lavoie that the current legal approach makes sense.
“By restarting consultation, they are taking what appears to be now the fastest possible way of doing it.”
The main sticking point is that no matter what, some of the First Nations don’t want TMX built, Flanagan says.
“If you were dealing with people who were dealing in good faith it would be quicker . ... They may enter consultation because it runs the clock, but you will never satisfy them.”
In the end, we’re left with two somewhat contradictory notions that can be true at the same time.
First, given their limited options, the Liberals are likely on the right legal path to getting TMX built.
Second, Trudeau’s negative talk about the oilsands, combined with the Liberal government’s opposition to the Energy East and Northern Gateway pipelines, along with its northwest coast B.C. tanker ban, cast grave doubt on the federal commitment to building the Alberta oil industry and successfully completing TMX.