Dark clouds loom over Edmonton after pipeline ruling

EDMONTON The court decision quashing approval for the Trans Mountain pipeline expansion could have serious long-term implications for the Edmonton economy, the chief economist at the city says.

“Over the next 12 to 24 months, it … will negatively impact energy, project management, manufacturing, logistics,” John Rose said.

“But it’s not going to be dramatic. If the project is scrapped, that will curtail investment in energy, which will be bad for the fiscal position of the province.”

The Federal Court of Appeal ruled Thursday the National Energy Board’s review of the plan to twin the oil pipeline to the West Coast from Alberta was so flawed that Ottawa couldn’t have relied on it as a basis for allowing the expansion in 2016.

The federal government also failed in its duty to engage in meaningful consultations with First Nations before approving the project, the written ruling said.

That decision means the federal government will have to redo part of its consultations with Indigenous groups.

Rose said Edmonton could suffer if the province runs into fiscal challenges, because much of the city ’s employment is in such public sectors as health care and administration.

“In the near term, it’s a negative. It’s not going to crush the local economy by any means, but when we get to 2022-23, when this facility was supposed to be (online), providing for further investment in the energy sector, I’m going to have to revise my projections down.”

Cory Wosnack, Edmonton managing director for Avison Young real estate, agreed the pipeline verdict is a setback for Alberta.

“The province had recently reappeared on the radar screens for investors who passed over the region for the past three years. (This) news will give many investors pause about the economic position of Alberta,” he said in an email.