A new process to bury our resources
On Thursday, Minister of the Environment and Climate Change Catherine McKenna introduced a long- awaited bill to overhaul environmental assessments of major federal energy projects, including pipelines. It is a mixed bag, full of conflicting objectives and commitments related to public trust, environmental protection, approval of “good” projects, getting resources to market, public engagement and Aboriginal reconciliation.
Unfortunately, it is more likely to heighten uncertainty, delays, cost and bureaucratic entanglement, even as it enhances the opportunity for opponents to scupper critical projects. Development plans for Canada’s vast natural resources, already reeling from years of low commodity prices and Liberal policies that range from indifferent to hostile, have been put in further jeopardy.
When I was minister of natural resources, our Conservative government introduced legislation that established the principle of “one project, one review” in a defined time period, based on an objective scientific analysis by an independent regulatory agency, after consultation with Indigenous communities and people who were directly impacted by the project. Our goal was to foster comprehensive reviews that were protective of the environment, but were not lengthy, duplicative, or vulnerable to manipulative and dilatory tactics designed to make projects economically unviable.
The new Liberal regulations will dilute, distort and undermine that sound process.
In her press conference announcing the new plan on Thursday, McKenna talked a lot about the need to restore public trust to avoid polarization and court challenges. However, when asked about the Kinder Morgan Trans Mountain pipeline that is now being obstructed by the B.C. government, she said it had been approved under the interim Liberal process and would have been approved had the new rules been in place. What she cannot claim is that opposition would have magically vanished. So creating this entirely new, expen- sive process ($ 1 billion and counting) would not have changed the minds of the B.C. government, environmental groups, certain coastal communities or First Nations.
The bill will add an additional layer of bureaucracy through the creation of an Impact Assessment Agency of Canada, with responsibility for project reviews. Also, existing regulatory bodies, including the National Energy Board ( NEB), will continue to monitor lifecycle activities and will be involved in joint impact assessments, which will be part of an “integrated review process.” That sounds more like triplication than a single review, so the table is set for dissension and delay. Other than political posturing, there is no apparent justi- fication for taking the authority for reviewing energy projects away from the NEB, which has the expertise and institutional knowledge.
The assessment will examine cumulative effects in the context of an excessively broad scope that extends well beyond the direct economic and scientific impact of the proposed projects to include long- term social and health impacts and upstream and downstream emissions. It will also consider potential impacts on the government’s climate change guidelines. Furthermore, it must incorporate traditional Indigenous knowledge, which raises questions about how that knowledge would be evaluated and whether it raises conflict-of-interest concerns for affected First Nations communities.
In addition to its openended mandate, the agency will hear from people who may not be directly impacted by the project but who have an opinion. Public consultations will be very broad, including input on evaluation of project designs, plans and studies, and will be likely chaotic, reflecting deeply held but irreconcilable views. Also, time lines will be longer, because of the addition of an early engagement process of up to 180 days.
As we know, Indigenous groups can have diametrically opposing views on development, although those in favour are often silenced. Some see the enormous advantages of development for their communities in terms of employment, a long- term revenue stream, equity participation and having a seat at the table. Others focus on risks to their traditional way of life and the environment. The government has endorsed the U. N. Declaration on the Rights of Indigenous Peoples. That raises an expectation that “free, prior and informed consent” implies a right to block resource development on or adjacent to current or ancestral Aboriginal lands. So far, the Supreme Court and the federal government have avoided going that far. Were it to happen, the future of development could be fatally compromised.
The inevitable result of regulatory overreach, empowered opponents, further delays and uncertainty will be to make pipelines unattractive investments. At a certain point, no sponsor will risk millions in a project that is mired in controversy, especially without assertive leadership from the government of Canada — witness the Pacific Northwest LNG and Energy East project cancellations. So we are trapped, without access to i nternational markets for our oil and gas.
T he economic consequences of permanently landlocked energy would be hundreds of billions of dollars of lost revenue and a significant hit to employment, growth and funding for critical social programs like health care. In short, we would be a poorer country and only have ourselves to blame because we allowed government to squander our legacy.
CREATING THIS ENTIRELY NEW, EXPENSIVE PROCESS WOULD NOT HAVE CHANGED THE MINDS OF THE B.C. GOVERNMENT.