In a broad and sweeping interview with this writer on Feb. 13, a confident Prime Minister Justin Trudeau came out swinging on behalf of Kinder Morgan’s Trans Mountain pipeline expansion (TMX). Pulling no punches, he took direct aim at both Saskatchewan’s former premier, Brad Wall, and B.C. Premier John Horgan. The federal government sees both TMX and carbon pricing as integral to Canada’s Paris commitments and its pan-Canadian climate framework.
The prime minister has a simple message to all comers. Canada’s climate deal comes with tidewater access for Alberta oil, full stop. Don’t mess with this nexus.
And Trudeau made it clear that a similar drubbing is in store for United Conservative Party Leader Jason Kenney, should he at some future time try to tear up Alberta Premier Rachel Notley’s price on carbon. Repeal those terms, and Trudeau will assert his federal authority and impose his own on the province.
But listening closely to the prime minister, one gets the sense there is still unfinished business, and this project is in for some very heavy sledding.
Genesis of a historic climate agreement
Looking back, it’s plain how this deal came together. In the heady days of his unexpected October 2015 majority victory and the looming Paris talks, Trudeau needed a big climate win, and fast. And there was Notley, ready to deal. Her province was deep in recession with no end in sight. Global oil was in the basement and Alberta was stuck with rock bottom prices dictated by its only customer, Uncle Sam.
How can the government justify shareholders and various levels of government pulling in billions from Kinder Morgan's expansion using First Nations lands, while Indigenous Canadians are on boil water advisories? asks @Garossino #cdnpoli #TMX
As all of these factors gutted the provincial treasury, major international oilsands players virtually all pulled up stakes and blew town.
A softened-up industry was ready to play along. They’d support Notley’s carbon tax, emissions cap, and coal phase-out, but only if they could access higher global prices for their oil. They believed they could do that by getting it to tidewater in a way that by-passed the huge cost of rail transport. They needed a pipeline to the coast. To any coast with ports serving overseas markets.
The moment seemed as perfect as it was historic. A once-powerful industry on the ropes, ready for concessions. A new and ambitious NDP provincial government poised to lead. A euphoric nation committed to climate reform and hitting the global stage at Paris with a plan.
Of course Trudeau saw his opening and took it. Anyone experienced with hammering out tough agreements would.
Any niggling smaller problems could be left for later.
Well, it’s later now, and the problems, once so small in the distance, are suddenly looming very large indeed.
It bears remembering that, in addition to climate change, the freshly installed prime minister embarked on one other pre-eminent national objective in 2015: fully embracing reconciliation and defining a new relationship with First Nations.
National climate framework and Indigenous policy on collision course in B.C.
Those two signature goals — a national climate framework and the repair of federal relations with Indigenous Canadians are now on collision course in British Columbia. Right on the heels of First Nations comes the highest concentration of committed environmentalists in Canada, if not North America. And they’re in a fighting mood.
First Nations territorial sovereignty is a uniquely thorny issue in B.C. because, unlike most of the rest of Canada, no treaties establish Crown authority for the vast majority of the province. The exact scope and limits of Indigenous title has yet to be settled.
In June, 2016 the Federal Court of Appeal quashed the NEB’s Enbridge Northern Gateway approval for an inadequate First Nations consultation. The same court is currently hearing a virtually identical challenge of the NEB’s approval of Kinder Morgan’s TMX project.
Can Kinder Morgan’s TMX succeed where Enbridge failed?
Language of the powerless
Just about everyone familiar with Kinder Morgan credits their process with greater sensitivity and good faith than the Northern Gateway applicants. Yet a ministerial panel of experts in governance and public policy, struck by Natural Resources Minister Jim Carr, raised serious questions about the overall process.
What emerges from that 58 page report isn’t a picture of a rejuvenated federal relationship with First Nations, but a second verse, same as the first. The ministerial panel’s report cited fairly typical examples:
“In Chilliwack, for example, Seabird Band member Tyrone McNeil said,
‘We haven’t seen detailed design. We haven’t seen emergency response plans. We haven’t seen any analysis of the effect of a spill or a recovery strategy for salmon and sturgeon. Especially with the recognition of UNDRIP (UN Declaration on the Rights of Indigenous People, signed in by Canada in 2016), the timelines need to slow down…’
And Cheam Chief Ernie Crey offered a final thought on context.
‘I sit up nights wondering what a spill into the Coquihalla River might look like. Even a small spill into the Coquihalla would devastate salmon in the Fraser River and plunge First Nations into utter destitution. Global trade, investment, jobs: I know those are important, but consider what could be lost.’
In an introductory letter to the briefing note quoted above, Sunchild Chief Jonathan Frencheater said:
‘Sunchild is not categorically opposed to this proposed project, we simply wish to be included. We do not deny having been given the opportunity to speak to the National Energy Board, but we have not been heard. The NEB process has been unilateral; Kinder Morgan has not engaged Sunchild First Nation as a true stakeholder in this proposed Project, but as a bystander to be placated and bypassed.’
The panel heard variations of this complaint from many First Nations.
The panel also reported concerning language among many of the Indigenous communities that had signed benefit agreements.
"But some First Nations said that, as with the Scia’new, they signed the benefit agreements or letters of support out of concern that, if they failed to do so, they risked getting nothing at all. Kyra Northwest, of the Samson Cree Nation, said
"'You can oppose, but with the past government it (a proposed project) would get approved either way, so Samson Cree agreed just to be sure we would get something.'
"And Summer Ebringer, of the Enoch Cree First Nation agreed, 'The fear is that if you don’t sign and it goes ahead anyway, you get nothing.'
This is the language of the powerless, of people with no leverage or bargaining power. People who have been forced to grovel on their own land. In front of their own children.
Even the phrase "benefit agreement" sounds like welfare.
You know who never uses language like this?
Bankers. Insurers. Trading partners. The Canada Revenue Agency. Anyone with the power to sink your project like a stone.
First Nations benefit agreements incredibly stingy
If there is one thing that should come out of the Kinder Morgan consultation process in this era of reconciliation, it's that they should never have to grovel like this again.
The prime minister needs to be as active on this file as he has been on climate.
Because the one thing that stands out about the Kinder Morgan Indigenous package is how incredibly stingy it is. According to the federal government, the proponents' "mutual benefit agreements" with Indigenous communities are valued at about $300 million, presumably over the multi-decade life span of the pipeline.
If that sounds like a lot, wait until you see what everyone else gets.
Kinder Morgan estimates that Canadian oil producers will generate an additional $3.7 billion a year from access to foreign markets. Over 20 years, that's $74 billion. Total federal, provincial, and municipal taxes generated from the project over 20 years are estimated at nearly $50 billion.
The B.C. First Nations, who are forced to pony up the critical lands to uncork this gusher of billions, get about $15 million a year, over 20 years.
That's a disgrace.
How can the government justify shareholders and various levels of government pulling in billions from Kinder Morgan's expansion using First Nations lands, while Indigenous Canadians are on boil water advisories?
Seriously, Aboriginal communities need to get together and hire LeBron James' agent asap, because if LeBron plays 20 years he'll out-earn them by $200 million on his NBA salary alone. And he plays for Cleveland.
Of course, none of this comes as any surprise. The history of development in Canada is always "sorry not sorry."
If Canada sincerely wants to change course on its First Nations' relationship, then it must lead on pipeline benefits today.
Trudeau opening the door to court challenge?
As things stand, the NEB's approval of Kinder Morgan's TMX is under challenge by a number of First Nations in the Federal Court of Appeal, where it may fail.
The Supreme Court of Canada ruled in the Tsilhqot’in decision that the government must meaningfully consult with First Nations holding title.
In any genuine consultation there ought to be some possibility that a given project may not proceed, depending on consultation outcomes. If that possibility isn’t present, any negotiation or “consultation” is a charade.
Prior to any incursion on Aboriginal territory, the government must demonstrate a compelling objective, show that it has executed its fiduciary duty, and that incursion on Aboriginal land is essential to its goal.
On this score, Trudeau’s answers were telling.
It appears that the prime minister decided to approve the pipeline in principle even before the NEB made its recommendation. That’s before there could have been meaningful government consultation with affected First Nations, notwithstanding the extensive efforts by Kinder Morgan itself. The Federal Court of Appeal ruled in the Enbridge case that the government can’t delegate its consultation function to the NEB and license applicants, although a recent decision over the Enbridge Line 9 reversal project approval seemed to go the other way.
Even more significantly, by asserting his intention to act unilaterally if Alberta’s climate concessions are repealed, Trudeau signaled that his national climate framework may not really depend on that province after all.
If that’s the case, it doesn’t depend on the pipeline either.
(It’s also worth remembering that when this deal came together, then-President Barack Obama had just blocked the somewhat larger Keystone XL pipeline, which was also a route to the U.S. shoreline and global markets. In the yo-yo world of electoral pipeline politics, President Donald Trump brought Keystone back into viability, just as Horgan moved to block Kinder Morgan.)
If the courts conclude that Kinder Morgan's TMX is purely a bargaining chip to bring Alberta onside as a political benefit for the prime minister, this entire exercise could be doomed. Nor is it a great look for a leader embarking on a definitive new framework for Indigenous rights.
Which is probably why Trudeau’s intimates that negotiations are continuing apace to bring First Nations onside with project benefit agreements. If the Canadian government is intent on this course, Minister Jane Philpott should get into the mix and sweeten the pot for all First Nations. As they stand, these benefit agreement numbers should shock the conscience of Canadians.
The environmental crucible
Even if Kinder Morgan clears the hurdle of a First Nations court challenge and First Nations activism, it must then confront formidable opposition from B.C. environmental activists. For better or worse, not every goal a government sets is politically achievable. Kinder Morgan may become a crucible for the Canadian government and the environmental movement alike, the likes of which we have not seen in a generation.
As it pushes through dozens of kilometres of Fraser Valley farmland, the expanded pipeline will enter into the densely populated heart of Metro Vancouver, home to 2.5 million residents, and more than half the total B.C. population.
Forty-nine per cent of all Metro Vancouverites, or a population roughly the size of Calgary, oppose the pipeline. According to local polling firm Insights West, one in four of those would consider some act of civil disobedience to stop it. That’s a whole lotta handcuffs.
Anyone who deludes themselves that opponents are gullible pawns of shadowy American interests might remember that British Columbia has done more to export environmental activism to the rest of the world than the reverse. This is the DNA of Vancouver, and always has been. If you don't love the coast and the natural world around it passionately, there are better places to make a living.
It was in Vancouver that Greenpeace was born. It’s the home of Tzeporah Berman, architect of B.C.’s epic battle over old-growth clear-cut logging in Clayoquot Sound. It’s where Canadian Paul Watson founded the Sea Shepherd Conservation Society. Occupy Wall Street even got its beginnings in Vancouver (look it up). Tides Canada and the David Suzuki Foundation are both based in the city.
Mayor Gregor Robertson’s environmentally-inspired Vision Vancouver has dominated City Council for a decade. B.C. is the only province where the Green Party has elected candidates municipally, provincially and federally. It currently holds the balance of power in John Horgan’s minority government.
In other words, Metro Vancouver, Vancouver Island, and the B.C. Gulf Islands along the tanker route are home to the highest concentration of environmental activists and voters in Canada, if not North America. If this project proceeds, oil tankers will sail past David Suzuki’s waterfront Vancouver house every day for the rest of his life. These are not hobbyists or rent-a-crowds. It is difficult to overstate the intensity, resolve, and sophistication of the forces now gathering to oppose Kinder Morgan's TMX as it prepares to push into Metro Vancouver. This fact has not escaped Premier John Horgan. Make no mistake, Justin Trudeau’s steel is about to be tested in a way few have anticipated.
How far will he go?
Canada will just have to watch him.
Fasten your seatbelts, everybody. We’re in for a bumpy ride.