Court quashes Canadian approval of Trans Mountain oil pipeline

Court quashes Canadian approval of Trans Mountain oil pipeline

Trudeau himself called the NEB review of the Trans Mountain expansion he inherited from Stephen Harper flawed, and he moved to gather more public input and launched further consultations with Indigenous communities affected by the project. The Trudeau government planned to sell the pipeline.

The Canadian Federal Court of Appeals ruled the review of the US$9.3 billion expansion plan submitted by the National Energy Board was inadequate and energy officials had also failed to consult with members of the First Nations.

He said the government was reviewing the decision "carefully" and considering its next steps and would respond "promptly and in a meaningful way" as the court requested.

In May the government of Justin Trudeau agreed to buy the pipeline from Kinder Morgan Canada Limited for nearly $US3.5 billion ($NZ5.2b), betting it would win the court battle and expand Trans Mountain despite fierce political and environmental opposition.

The ruling all but ensures a planned 2021 start date won't be met for the expansion, which is created to almost triple capacity on the Edmonton to Burnaby, B.C., pipeline to 890,000 barrels a day.

Kinder Morgan officials declined to be interviewed about the court decision, but in a prepared statement the company said the deal with the federal government would be finalized within seven days and could close as early as tomorrow. It was approved by the federal government in 2016.

The 2018 provincial budget forecasted a debt load that would balloon to $96 billion by 2023 from $54 billion this year. Trudeau used the pipeline expansion project as a bargaining chip to get a national carbon pricing plan established.

Lee Spahan, chief of the Coldwater First Nation in the Nicola Valley - which he said is known as the people of the creek - said the ruling helps save water. The consultations with First Nations must be re-done before the project can be considered for approval again. The court ruled that although the issues were valid, state officials failed to resolve them.

The decision will require the NEB to restart its review of the expansion project.

He said he expects the federal government to send the project back to the NEB, as suggested by the federal court.

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The decision was a major victory for Canadian First Nations, environmental groups and USA tribes that opposed the pipeline expansion.

"This is just another example to worldwide investors of why Canada is not looked upon as a friendly jurisdiction", said Jim Davidson, deputy chairman of investment bank GMP FirstEnergy in Calgary.

"A long time ago, we said they could do this the easy way or the hard way".

Otis Jasper, director of operations for the Tk'emlups Te Secwepemc First Nation in Kamloops, said that should Prime Minister Justin Trudeau choose to re-start the consultation process, as directed in the court ruling, those who have fought it "look forward to having that nation to nation conversation". They were supported by the province of British Columbia, which acted as an intervener.

"The unjustified exclusion of marine shipping from the scope of the project led to successive, unacceptable deficiencies in the [NEB's] report and recommendations".

"We see the value in the twinning of the pipeline to support economic stability in our region", says association president Bryce Herman.

Chief Bob Chamberlin, vice-president of the Union of British Columbia Indian Chiefs (UBCIC), said the ruling is "a major win with impacts that will be felt across the country".

The decision also hurts Canada's oil producers, who say the expanded pipeline is needed to address bottlenecks that have sharply reduced prices for their crude.

It also must pain a government that has hung so much of its credibility on Indigenous reconciliation to be told by a court that its consultation with Indigenous communities concerned about this expansion amounted to little more than note-taking.

The event was organized at Vancouver's Crab Park, which overlooks Burrard Inlet, home of Kinder Morgan's Westridge Marine Terminal.

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