Haisla ask cabinet to postpone Northern Gateway decision to allow for adequate consultation with First Nations

Haisla NationThe Haisla Nation are calling on the federal cabinet to postpone its decision on the Northern Gateway project to allow time for adequate consultations with First Nations, according to the Haisla response to the Joint Review Panel, seen by Northwest Coast Energy News.

The Joint Review Panel report and recommendations were released on Dec. 19, 2013 and the cabinet has 180 days from that point to recommend approval of the project.

The Haisla argue that Section 54 of the National Energy Board act allows the Governor-in-Council, the federal cabinet, to extend the timeline if it wants to, if recommended by the Minister of Natural Resources.

So far, the Harper government has refused to extend the deadline. The Haisla response document says Chief Counsellor Ellis Ross spoke to Minister of Natural Resources Joe Oliver on the telephone requesting the extension, but, according to the document, all Oliver did was point to the legislation that calls for the 180 day response to a joint review report.

The Haisla response document also has a long lists of what the Haisla say are flaws in the Joint Review Panel report.

Consultations

In correspondence with the Haisla, Brett Maracle, Crown Consultation Coordinator at the Canadian Environmental Assessment Agency for the Northern Gateway project, says:

the process set out by the Government of Canada in the Aboriginal Consultation Framework was finalized after receiving and carefully considering input from Aboriginal groups….The Government of Canada believes the process outlined in the Aboriginal Consultation Framework provides for a deep level of meaningful consultation with Aboriginal groups with Phase IV being the final step prior to a decision being made on the Project.

The Haisla dispute there has been any “deep level of meaningful consultation,” citing in the document a long list of attempts to engage the federal government with little or no response.

In their response, the Haisla Nation Council says:

Canada, has, to date, refused to engage in meaningful consultations with the Haisla Nation. Instead Canada has unilaterally imposed what it calls a “deep level meaningful consultation” process which is fundamentally flawed for a number of reasons…

The document lists attempts by the Haisla to engage with ministers and government departments including requests for a meeting with then Environment Minister Peter Kent, prior to the opening of the JRP formal hearings in Kitamaat Village in January 2012. Although the Haisla requested a meeting with Kent, several times in 2011, no meeting ever occurred. It was not until April 19, 2012, four months later that Kent replied to the Haisla saying he had asked the President of the Canadian Environmental Assessment Agency to meet with the First Nation prior to the start of the JRP hearings. However, it was apparently impossible to schedule such a meeting in December, 2011.

To which the Haisla reply:

For over six years, Canada ignored Haisla Nations requests for meetings. Once the JRP’s oral hearings process commenced, Canada further closed the door on any opportunity for a meeting until the JRP Report was release. This refusal to consult was baseless. The ongoing JRP process was not a rational or justifiable basis for Canada’s refusal to consult…

Canada has yet to meet with the Haisla Nation to discuss the proposed project, other than to tell the Haisla Nation it is only engaging through the JRP process for now. This is not consultation. It is, perhaps, at best an initial step towards a consultation process.
Ignoring the Eyford report

Joe Oliver
Natural Resources Minister Joe Oliver (front far right) answers questions after his news conference at the Northwest Community College Long House, March 19, 2013. Douglas Eyford is standing behind Oliver. (Robin Rowland/Northwest Coast Energy News)

In March 2013, Natural Resources Minister Joe Oliver flew to Terrace for a photo op to announce the appointment of Douglas Eyford to consult First Nations on the Northern Gateway project. Oliver then flew back to Ottawa without meeting anyone in the region. Eyford’s report Forging Partnership Build Relationship was released in November, 2013.

The Haisla say:

Mr. Eyford’s Report recommended that Canada should consider undertaking early engagement to address Aboriginal interests that may not be dealt within a regulatory process. The Haisla Nation has been seeking such early engagement from Canada since the proposed project was first announced.

Mr. Eyford’s Report also recommended that Canada should engage and conduct consultations n addition to those in regulatory processes, as may be required, to address issues and facilitate resolutions in exceptional circumstances. The Haisla Nation also asked for this, identifying early that this proposed project was an exceptional circumstance due to the significant potential impacts on the Haisla Nation.

It is not too late for Canada to correct the deficiencies in its consultation process, but cannot realistically do so by adhering unilaterally by Canada and laid out in Mr. Maracle’s letter of December 16, 2013

The Haisla Nation Council response was sent to Brett Maracle, Crown Consultation Coordinator at the Canadian Environmental Assessment Agency for the Northern Gateway project. The Haisla also sent copies of the response to Joe Oliver, the Minister of Natural Resources, Gaetan Caron, Chair of the National Energy Board, Leon Aqlukkaq, Minister of the Environment, Bernard Valcourt Minister of Aboriginal Affairs and Northern Development, Gail Shea, Minister of Fisheries and Oceans, BC Premier Christy Clark, Steve Thomson, BC Minister of Forests, Lands and Natural Resources and Mary Polak, BC Minister of the Environment.

Related

Ottawa’s Northern Gateway consultation with First Nations limited to three simple questions and 45 days: documents

Haisla consultation reply outlines flaws in Northern Gateway Joint Review report

Haisla response lists evidence rejected by Northern Gateway Joint Review

DFO hands over fisheries protection along pipelines to the NEB

 

The Department of Fisheries and Oceans has handed responsibility for fish and fish habitat along pipeline routes over to the National Energy Board. The same agreement also gives the National Energy Board responsibility for dealing with First Nations fisheries if a pipeline or power line crosses their traditional territory.

DFO and NEB quietly announced a memorandum of agreement on December 16, 2013, that went largely unnoticed with the release three days later of the Joint Review Panel decision on Northern Gateway and the slow down in news coverage over the Christmas holidays.

Update January 16, 2013: DFO clarifies relationship with NEB on fisheries protection along pipeline routes

As of December 16, 2013,  Enbridge no longer has to apply to DFO for permits to alter fish habitat along the Northern Gateway route. It was also on December 16 that Kinder Morgan filed its application with the NEB for the expansion of its pipeline from Alberta to Burnaby.

Fish and fish habitat along those pipeline is now the responsibility of the Alberta-based, energy friendly National Energy Board.

On its website, the NEB says

Applications submitted to the NEB shall be reviewed under the Fisheries Protection Provisions of the Fisheries Act to determine if impacts shall occur, and if an authorization will be required under the Fisheries Act. The NEB shall also become responsible to determine if proposed projects will impact aquatic species at risk and require permitting under the Species at Risk Act. If the NEB determines than an authorization or permit will be required, DFO shall be notified and will be responsible for issuing the authorization or permit.

This MOU better integrates the Government of Canada’s initiative to streamline application processes by eliminating the requirement for duplicate reviews.

In the “Guiding Principles” of the memorandum of understanding between DFO and NEB, the first provision is

The Parties will use the provisions of this MOU to support the Government of Canada’s regulatory process improvement objectives through coordination to:
Facilitate effective and efficient use of government resources in order that regulatory decisions are made in a timely manner by applying a one-project one-review approach;
Promote clarity and consistency of the regulatory decision making process; and
Ensure responsibilities for mitigation, monitoring and reporting, compliance and enforcement, follow-up monitoring, and Aboriginal consultation are addressed.

Protecting fisheries and fish habitat is only the third priority in the MOU

Conservation and protection of fish and fish habitat, and listed aquatic species at risk and their critical habitat, will be managed in accordance with DFO’s regulatory and policy frameworks for the application of the fisheries protection provisions of the Fisheries Act and SARA [Species at Risk Act] respectively.

The question most people on the northwest coast and along BC’s rivers will ask (whether or not they support or oppose pipeline projects): Just how much expertise, if any, in fisheries and fish habitat can be found in the Calgary offices of the National Energy Board?

According to the FAQ posted on the NEB website, it is now up to the NEB to determine whether a project impacts fisheries or species at risk.

How will the MOU affect authorizations under the Fisheries Act?

The NEB will assess a project application and determine if mitigation strategies are needed to reduce or prevent impacts to fish or fish habitat. If the project could result in serious harm for fish then the NEB will inform DFO that a Fisheries Act authorization under paragraph 35(2)(b)  is likely to be required. DFO will review and issue an authorization when appropriate, prior to project construction. Authorizations issued by DFO would relate to those watercourses impacted, not the entire project.

How will the MOU affect permits under SARA?

The NEB will assess a project application for potential impacts to aquatic species at risk. If an impact to a SARA-listed aquatic species may occur, the NEB will inform DFO.  DFO will review and issue a permit under SARA when appropriate, prior to project construction.

The NEB claims that the MOU will not affect environmental protection

Will this MOU reduce environmental protection?

No, the NEB has always considered impacts to fish and fish habitat and aquatic species at risk when making its decisions. The initial assessment of impacts of federally regulated pipeline and power line projects

 

Another potentially troubling aspect of the agreement is that it makes the National Energy Board the lead agency in dealing with First Nations.

when the Crown contemplates conduct that may adversely affect established or potential Aboriginal and treaty rights in relation to the issuance of authorizations under the Fisheries Act, and/or permits under SARA, the NEB application assessment process will be relied upon by DFO to the extent possible, to ensure Aboriginal groups are consulted as required, and where appropriate accommodated;

 

Canada’s First Nations have dealt with DFO for generations and by and large both sides understand each other’s aims, even if they don’t always agree.  The NEB, however, at least as seen during the JRP hearings, often showed little understanding or respect for First Nations.  That means that already troubled relationship between First Nations and the Crown over pipelines is going to get a lot more troubled.

 

The memorandum of understanding between DFO and MOU is yet another result of the Harper government’s omnibus bills, which have the aim of efficiently approving energy projects while downplaying environmental costs.

It also means that from now on there must be a much more careful reading of the 209 conditions imposed by the Joint Review Panel on Enbridge to see if those conditions are actually going to be rigorously enforced or if all Enbridge has to do is to file reports with the NEB.

It also appears that the new and highly restrictive NEB procedures that restrict input from all but those the NEB considers “directly affected’ by a project will also apply to their new responsibility for fisheries.

 

Joint Review Panel tells northwestern BC to bear the “burdens” of Northern Gateway for the good of Canada

 

Joint Review Panel cover
Cover of Volume 1 of the Joint Review Panel ruling on Northern Gateway

 

If you read both the 76 pages of Volume One of the Northern Gateway Joint Review decision and the 417 pages of Volume 2, a total of 493 pages, one word keeps reappearing. That word is “burden.”

The JRP panel asks “How did we weigh the balance of burdens, benefits, and risks?”

And it says:

Many people and parties commented on the economic benefits and burdens that could be brought about by the Enbridge Northern Gateway Project. In our view, opening Pacific Basin markets wouldbe important to the Canadian economy and society. Though difficult to measure, we found that the economic benefits of the project would likely outweigh any economic burdens.

The JRP notes:

The Province of British Columbia and many hearing participants argued that most of the project’s economic benefits would flow to Alberta, the rest of Canada, and foreign shareholders in oil and pipeline companies. They said British Columbia would bear too many of the environmental and economic burdens and risks compared to the benefits.

But, as the panel does throughout the ruling, it accepts, with little, if any, skepticism, Northern Gateway’s evidence and assertion:

Northern Gateway said about three-quarters of construction employment would occur in British Columbia, and the province would get the largest share of direct benefits from continuing operations.

It does touch on the “burdens” faced by the Aboriginal people of northern BC and others in the event of a catastrophic spill.

In the unlikely event of a large oil spill, we found that there would be significant adverse effects on lands, waters, or resources used by Aboriginal groups. We found that these adverse effects would not be permanent and widespread. We recognize that reduced or interrupted access to lands, waters, or resources used by Aboriginal groups, including for country foods, may result in disruptions in the ability of Aboriginal groups to practice their traditional activities. We recognize that such an event would place burdens and challenges on affected Aboriginal groups. We find that such interruptions would be temporary. We also recognize that, during recovery from a spill, users of lands, waters, or resources may experience disruptions and possible changes in access or use.

And the JRP goes on to say:

We recommend approval of the Enbridge Northern Gateway Project, subject to the 209 conditions set out in Volume 2 of our report. We have concluded that the project would be in the public interest. We find that the project’s potential benefits for Canada and Canadians outweigh the potential burdens and risks….

We are of the view that opening Pacific Basin markets is important to the Canadian economy and society. Societal and economic benefits can be expected from the project. We find that the environmental burdens associated with project construction and routine operation can generally be effectively mitigated. Some environmental burdens may not be fully mitigated in spite of reasonable best efforts and techniques…. We acknowledge that this project may require some people and local communities to adapt to temporary disruptions during construction.

As for the chance of a major oil spill, again the JRP talks about burdens:

The environmental, societal, and economic burdens of a large oil spill, while unlikely and not permanent, would be significant. Through our conditions we require Northern Gateway to implement appropriate and effective spill prevention measures and spill response capabilities, so that the likelihood and consequences of a large spill would be minimized.

It is our view that, after mitigation, the likelihood of significant adverse environmental effects resulting from project malfunctions or accidents is very low.

And concludes:

We find that Canadians will be better off with this project than without it.

In the Joint Review ruling is one fact. Northern British Columbia must bear the “burden” of the Northern Gateway project for the good of Alberta and the rest of Canada. The JRP accepts, without much questioning, Northern Gateway’s assurances that environmental disruptions during construction will be minimal and that the chances of a major spill from either a pipeline or a tanker are minimal.

Canadians as a whole may be better off with the Northern Gateway. Whether the people who live along the pipeline and tanker route will be better off is another question, one which the Joint Review Panel dismisses with casual disdain.

Cover of JRP ruling
Cover of Volume 2 of the Joint Review rulng on Northern Gateway

The politics of the Joint Review Panel

There are actually two Joint Review Panel reports.

One is political, one is regulatory. The political decision by the three member panel, two from Alberta and one from Ontario, is that the concerns of northwestern British Columbia are fully met by Enbridge Northern Gateway’s assurances. There is a second political decision, found throughout both volumes of the report, and the reader sees the Joint Review Panel has the notion that many parts of the environment have already been degraded by previous human activity, and that means the construction and operation of the Northern Gateway will have little consequence.

Here is where the Joint Review Panel is blind to its own bias. With its mandate to rule on the Canadian “public interest,” the panel makes the political determination that, in the Canadian public interest, northwestern BC must bear the “burden” of the project, while other political issues were not considered because, apparently those issues were outside the JRP’s mandate.

…some people asked us to consider the “downstream” emissions that could arise from upgrading, refining, and diluted bitumen use in China and elsewhere. These effects were outside our jurisdiction, and we did not consider them. We did consider emissions arising from construction activities, pipeline operations, and the engines of tankers in Canadian territorial waters.

During our hearings and in written submissions, many people urged us to include assessment of matters that were beyond the scope of the project and outside our mandate set out in the Joint Review Panel Agreement. These issues included both “upstream” oil development effects and “downstream” refining and use of the products shipped on the pipelines and tankers…Many people said the project would lead to increased greenhouse gas emissions and other environmental and social effects from oil sands development. We did not consider that there was a sufficiently direct connection between the project and any particular existing or proposed oil sands development or other oil production activities

If someone in Northwestern British Columbia favours the Northern Gateway project, if they believe (and many people do) what Enbridge Northern Gateway says about the economic benefits, then it is likely they will accept the burden and the further environmental degradation imposed by the Joint Review Panel on this region of British Columbia.

If, on other hand, for those who are opposed to the project, then the decision to impose the burden on this region is both unreasonable and undemocratic (since no one in northern BC, in the energy friendly east or the environmental west has been formally asked to accept or reject the project). For those opposed to the project, the idea that since the environment has already been disrupted by earlier industrial development, that Canadians can continue to degrade the environment with no consequence will only fuel opposition to the project.

As for the assertion that green house gas emissions were not part of the Joint Review Panel’s mandate, that is mendacious. The panel made a political decision on the role of the people of northwestern BC and the state of northwestern BC’s environment. The panel made a political decision to avoid ruling on the role of Northern Gateway in contributing to climate change or the larger world wide economic impact of pipelines and the bitumen sands.

Regulations

The Joint Review Panel is supposed to be a regulatory body and should be pipeline, terminal and tanker project go ahead after the expected court challenges from First Nations on rights, title and consultation and from the environmental groups, then those 209 conditions kick in.

While the Joint Review Panel largely accepts Enbridge Northern Gateway’s evidence with little questions, in some areas the panel does find flaws in what Northern Gateway planned. In a few instances, it actually accepts the recommendations from intervenors (many from First Nations, who while opposed to the project, successfully demanded route changes to through environmentally sensitive or culturally significant territory.)

When it comes to regulations, as opposed to politics, the Joint Review Panel has done its job and done it well. If all 209 conditions and the other suggestions found in the extensive second volume of the ruling are actually enforced then it is likely that the Northern Gateway will be the safe project that Enbridge says it will be and actually might meet BC Premier Christy Clark’s five conditions for heavy oil pipelines across BC and tankers off the BC coast.

But and there is a big but.

The question is, however, who is going to enforce the 209 conditions? In recent conversations on various social media, people who were quiet during the JRP hearings, have now come out in favour of the pipeline project. Read those comments and you will find that the vast majority of project supporters want those conditions strictly enforced. Long before the JRP findings and before Premier Christy Clark issued her five conditions, supporters of the Northern Gateway, speaking privately, often had their own list of a dozen or two dozen conditions for their support of the project.

The people of northwestern BC had already witnessed cuts to Fisheries and Oceans, Environment Canada and the Canadian Coast Guard in his region even before Stephen Harper got his majority government in May 2011.

Since the majority government Harper has cut millions of dollars from the budgets for environmental studies, monitoring and enforcement. The Joint Review Panel began its work under the stringent rules of the former Fisheries Act and the Navigable Waters Act, both of which were gutted in the Harper government’s omnibus bills. Government scientists have been muzzled and, if allowed to speak, can only speak through departmental spin doctors. The Joint Review Panel requires Enbridge Northern Gateway to file hundreds of reports on the progress of surveying, environmental studies, safety studies, construction plans and activities and project operations. What is going to happen to those reports? Will they be acted on, or just filed in a filing cabinet, perhaps posted on an obscure and hard to find location on the NEB website and then forgotten?

Will the National Energy Board have the staff and the expertise to enforce the 209 conditions? Will there be any staff left at Environment Canada, Transport Canada, Fisheries and Oceans and the Canadian Coast Guard where the conditions demand active participation by government agencies, or ongoing consultation between federal agencies and Northern Gateway? Will there actual be monitoring, participation and consultation between the project and the civil service, or will those activities amount to nothing more than meetings every six months or so, when reports are exchanged and then forgotten? Although Stephen Harper and his government say the Northern Gateway is a priority for the government, the bigger priority is a balanced budget and it is likely there will be more cuts in the coming federal budget, not enhancements to environmental protection for northwestern BC.

The opponents of the project might reluctantly agree to the 209 conditions if Harper government forces the project to go ahead. It will be up to the supporters to decide whether or not they will continue their support of Northern Gateway if the 209 conditions are nothing more than a few pages of Adobe PDF and nothing more.

 

Editorial: Once again the National Energy Board shows its contempt for British Columbia

Second Update December 10- NEB refuses to release JRP report in BC

The Globe and Mail reports Dec. 10, 2013

The National Energy Board says releasing its decisions in Calgary is standard practice regardless of where in Canada the project is located, and it will not make an exception for its report on the controversial $6.5-billion Northern Gateway pipeline proposal.

Apparently the NEB doesn’t trust reporters in BC to act as professionals. Also, as usual the stock market is more important than the people of BC.

NEB spokesperson Sarah Kiley told the Globe the board ruled out simultaneous lock-ups in Alberta and British Columbia.

“As far as hosting multiple media lock-ups, we need to make absolutely sure that the report is not inadvertently released before the markets close,” Ms. Kiley said. “This becomes more challenging if there are multiple events due to things like the need to ship reports.”

Because the ruling will affect markets, she said the report must be kept confidential until they close on the day of release.

 


A couple of years ago, on a visit to the Lower Mainland, I was speaking to man who was considering making a 10 minute comment before the Northern Gateway Joint Review panel. In the end, this man, who is by no means a radical environmentalist, just someone worried about the future, decided not to testify, telling me: “The National Energy Board is nothing more than an extension of the Petroleum Club.”

Once again today, the National Energy Board showed its contempt for British Columbia and proved my source’s belief that it is nothing more than an extension of the Petroleum Club.

Vancouver radio station News 1130 made a routine inquiry to the NEB about a reporters’ “lockup” on the day that the JRP decision is released. A “lockup” allows the media to read an embargoed report a few hours in advance so that  at the moment it is officially released, it can print or broadcast an accurate account of a government report.

News 1130 was told by the NEB that there would be no lockup in British Columbia, only reporters in Calgary, the home of the NEB, will have that opportunity, because “logistics did not work out for a lock-up” in Vancouver.

(Reporters who work along the actual pipeline route in the north are even farther off the NEB radar. The Calgary lockup will leave northerners to figure out what the JRP decision actually means from reports from Alberta-based journalists. The history of the past few years has proven that most Alberta-based reporters have little interest or knowledge of the concerns of northwest British Columbia.)

Before the JRP hearings began in January, 2012, a well-known northern First Nations leader predicted all this in a background conversation. He noted that there was no representation from British Columbia on the Joint Review Panel. The JRP had two members from Alberta, chair Sheila Leggett, and member Kenneth Bateman, while the “First Nations member,” Hans Matthews, was from Ontario. The First Nations leader, who would have to appear before the JRP, privately called them “flatlanders” with no knowledge of B.C.

He was right.

Even before that conversation, the Joint Review Panel blundered in its first appearance in Kitimat, the preliminary hearing at Riverlodge on August 30, 2010, by offending the Haisla Nation with a schedule of appearances crafted in Calgary that ignored that Kitimat is on Haisla traditional territory and put then Chief Counsellor Dolores Pollard well down on the schedule. That hearing was held up for about half an hour while the JRP scrambled to undo their mistake.

While the JRP did finally learn to respect the customs of BC’s First Nations, and the panel was often hamstrung by arcane and obsolete rules of procedure, the panel too often proved far too inflexible in understanding the issues along the pipeline route and up and down the coast.

The most recent example was the JRP’s refusal to consider the recent evidence from both scientists and Fisheries and Oceans about the growing importance of humpback whales in Douglas Channel. The JRP’s excuse was that the window for evidence had closed. If the Northern Gateway actually goes ahead, Enbridge speaks about the 30-year-life of the project. Yet the JRP’s continuing inflexibility acts as if all the key issues can be decided by the December 30 deadline and after that everything will be just fine.

In the past few weeks, report after report has been released on projects that will change the lives of the people of the northwestern British Columbia. The media of the northwest, all with very limited budgets, have been ignored time and time again.

Take another example from today. In March, the federal government flew its First Nations negotiator Douglas Eyford and Natural Resources Minister Joe Oliver to Terrace to announce the beginning of the Eyford’s meetings with BC First Nations (while at the same time Oliver didn’t bother to visit Kitimat). This morning, the Eyford report was released at a press event in media-rich Vancouver. For the release of the report, the northwest didn’t count.

On Tuesday, the federal government also used Vancouver to release a report on tanker traffic. While Vancouver is also vulnerable to tanker problems, the feds considered their message could be carried best by the mainstream major metro media. Again, no one bothered with the northwest, where the tankers will be sailing along the coast and up and down Douglas Channel.

A few weeks ago, BC Premier Christy Clark announced her agreement with Alberta Premier Alison Redford on the compensation issue, one of her five conditions for heavy oil development in the province. Clark solved the political dispute with Alberta by handing off the compensation issue from the province to the energy industry with absolutely no guarantee that the energy companies will actually offer compensation for crossing BC. Northern reporters could listen in to an audio feed of the news conference from the BC government website, but could not ask questions.

In the 21st century, of course, these news conferences are not about presenting factual information; the news conferences are about getting out a government message track, so questions from reporters who actually know about issues are not wanted.

The Joint Review Panel (with the NEB one of the “joint” partners) is supposedly, on paper, a quasi-judicial body, independent of the government.

If the JRP wants to salvage even a bit of its crumbling credibility for its Northern Gateway decision, it will show that it respects British Columbia. The means holding two additional lockups. If Terrace was good enough for the final arguments, and a central location for the northwest, one lockup should be held in Terrace, so northerners can read reporting by northwest-based reporters. The second, of course, should be in Vancouver for the province’s major media centre.

Given the record of the past two years, don’t hold your breath, time and time again the bureaucratic priorities and the fact that the NEB is thoroughly embedded in the energy culture of Alberta, it is likely that the release of the report sometime in the coming weeks will be Alberta-centric and will prove my source right, that the NEB is nothing more than that extension of the Petroleum Club.

 

Update: The Globe and Mail has confirmed News1130’s report in National Energy Board sidestepping B.C. on Northern Gateway.

The board plans to hold a media lock-up in Calgary, but does not have similar plans to brief reporters in British Columbia, says an official with the independent federal agency established to regulate international and interprovincial issues around the electrical utility, gas and oil sectors.

Board spokesperson Sarah Kiley said Thursday that the board recognizes there is an interest in B.C. in the subject, and said there is no final plan yet.

The Globe was unable to get a statement from the Liberal government of BC but for the opposition,Spencer Chandra Herbert (Vancouver-West End) said, the energy board should not be hiding out in Calgary when they announce what they are going to do, regardless of whether they approve or reject the project.

“You would think they would have the ability and respect for B.C. to host it here and explain whatever decision they make here to B.C. media and intervenors,” he said.

“We’re worthy of that respect.”

BC Alberta agreement on five conditions: BC news release

VANCOUVER – After officials worked through the night, Alberta Premier Alison Redford and British Columbia Premier Christy Clark today announced a framework agreement between the two provinces on moving energy resources to new markets.

“Agreement on B.C.’s 5 conditions is a necessary first step before any proposals can be considered for approval,” said Premier Christy Clark. “It is the way we do business in B.C. and it works. By working together with Alberta through these principles we can grow our economies, and strengthen Canada’s economy overall.”

The framework will also see the Government of British Columbia endorse Premier Redford’s Canadian Energy Strategy.

“A key part of our Building Alberta Plan is getting Alberta’s resources to new markets at much fairer prices so we can keep funding the programs Albertans told us matter most to them,” said Premier Alison Redford. “Today’s agreement with B.C. is good news for Alberta, for British Columbia and for all Canadians. I welcome Premier Clark’s endorsement of the Canadian Energy Strategy and our shared commitment to create jobs, long-term growth and position Canada as a true global energy superpower. We look forward to continued constructive dialogue with B.C.”

The governments of B.C. and Alberta agree that British Columbia’s conditions are intended to ensure both the responsible production of energy as well as its safe transport to new markets, giving projects the social licence to proceed.

B.C.’s conditions 1-4 are designed to achieve both economic benefit and risk mitigation on increased shipments through B.C. They mirror Alberta’s legislated commitments on responsible energy production. Alberta and B.C. agree that only through intensive environmental review and protection, enhanced marine safeguards and First Nations support, can projects proceed.

On condition five, Alberta agrees that B.C. has a right to negotiate with industry on appropriate economic benefits. Both governments agree it is not for the governments of Alberta and B.C. to negotiate these benefits. Both provinces reaffirmed that Alberta’s royalties are not on the table for negotiation.

BC Alberta agree on Christy Clark’s five conditions: Alberta news release

Office of the Premier
Office of the Premier of Alberta

Alberta and British Columbia reach agreement on opening new markets

VANCOUVER – After officials worked through the night, Alberta Premier
Alison Redford and British Columbia Premier Christy Clark today
announced a framework agreement between the two provinces on moving
energy resources to new markets.

“Agreement on B.C.’s 5 conditions is a necessary first step before any
proposals can be considered for approval,” said Premier Christy Clark.
“It is the way we do business in B.C. and it works. By working together
with Alberta through these principles we can grow our economies, and
strengthen Canada’s economy overall.”

The framework will also see the Government of British Columbia endorse
Premier Redford’s Canadian Energy Strategy.

“A key part of our Building Alberta Plan is getting Alberta’s resources
to new markets at much fairer prices so we can keep funding the
programs Albertans told us matter most to them,” said Premier Alison
Redford. “Today’s agreement with B.C. is good news for Alberta, for
British Columbia and for all Canadians. I welcome Premier Clark’s
endorsement of the Canadian Energy Strategy and our shared commitment
to create jobs, long-term growth and position Canada as a true global
energy superpower. We look forward to continued constructive dialogue
with B.C.”

The governments of B.C. and Alberta agree that British Columbia’s
conditions are intended to ensure both the responsible production of
energy as well as its safe transport to new markets, giving projects
the social licence to proceed.

B.C.’s conditions 1-4 are designed to achieve both economic benefit and
risk mitigation on increased shipments through B.C. They mirror
Alberta’s legislated commitments on responsible energy production.
Alberta and B.C. agree that only through intensive environmental review
and protection, enhanced marine safeguards and First Nations support,
can projects proceed.

On condition five, Alberta agrees that B.C. has a right to negotiate
with industry on appropriate economic benefits. Both governments agree
it is not for the governments of Alberta and B.C. to negotiate these
benefits. Both provinces reaffirmed that Alberta’s royalties are not on
the table for negotiation.

Apache sells some of its gas and oil assets, confirms commitment to Kitimat project

Apache CorporationApache Corporation said Thursday it will  sell oil and gas producing properties in the Nevis, North Grant Lands and South Grant Lands areas of western Alberta, to Ember Resources Inc., a private Canadian company, for CAN$220 million, as part of the company’s “portfolio rebalancing,” Apache said in a news release.

At the same time, Apache CEO Rodney Eichler said,  “We also remain focused on advancing the Kitimat LNG project to monetize large unconventional resources in the Liard and Horn River basins in northern British Columbia.”

“Going forward, Apache is focused on growing our liquids production from a deep inventory of crude oil- and liquids-rich opportunities that generate attractive rates of return on our extensive remaining acreage in Canada’s Western Sedimentary Basin,”  Eichler said.

“This transaction is one element of a comprehensive review of Apache’s portfolio to determine which assets make the most sense for Apache to own given our growth and return objectives and which assets are better owned by others,” Eichler said. “The Nevis, North Grant Lands and South Grant Lands assets fit in the latter category.”

Apache is selling 621,000 gross acres (530,000 net acres) and more than 2,700 wells that had average net production during the second quarter of 2013 of 67 million cubic feet of gas and 237 barrels of liquid hydrocarbons per day from late Cretaceous sands and coal seams. Apache says “it  will retain 100 per cent working interest in horizons below the Cretaceous, such as potential Duvernay and Nisku, in Nevis and North Grant Lands.”

Apache previously announced plans to divest $4 billion in assets by  the end of 2013. The company intends to use proceeds from the asset divestitures to reduce debt and enhance financial flexibility and to repurchase Apache common shares under a 30-million-share repurchase program authorized by the Board of Directors earlier this year.

In July, Apache announced an agreement to sell its Gulf of Mexico Shelf operations and properties to Fieldwood Energy LLC(Fieldwood), an affiliate of Riverstone Holdings, for cash proceeds of $3.75 billion. In addition, Fieldwood will assume all asset retirement obligations for these properties, which, as of June 30, 2013, Apache estimated at a discounted value of approximately $1.5 billion.

 

Kinder Morgan files last minute objection to Joint Review’s proposed conditions for Northern Gateway

Kinder Morgan logoKinder Morgan has filed a last minute objection to the Northern Gateway Joint Review Panel’s preliminary conditions for the Enbridge project.

One of the objections from Kinder Morgan is the provision in the JRP’s proposed Gateway conditions for “purpose built tugs” to escort tankers (a measure that Enbridge has proposed for the Gateway project). Another provision Kinder Morgan objects to is “secondary containment facilities at marine terminals” likely to become an issue if the Vancouver terminal is expanded by Kinder Morgan.

Overall, Kinder Morgan warns that if the JRP imposes some of the proposed conditions on the Northern Gateway, it could adversely affect future pipeline projects in British Columbia.

As well, Kinder Morgan, it appears, is already concerned that if the proposed oversight of Northern Gateway goes ahead, the Kinder Morgan plan to twin the pipeline from Alberta to Vancouver and expand terminal operations in Vancouver could face ongoing scrutiny and possible delays.

The Kinder Morgan document, from the company’s Calgary lawyer, Shawn Denstedt, of Osler, Hoskins and Harcourt, filed May 31, appeared among all the final arguments filed on Friday by intervenors and governments to the Joint Review Panel on Northern Gateway.

Kinder Morgan’s letter to the JRP comes long after the final deadline for such comments.

Kinder Morgan is a registered intervenor in the Northern Gateway hearings, but has only filed four previous documents during the entire multi-year process. The company does not appear on the list of intervenors scheduled to appear for oral final arguments in Terrace beginning on June 17.

On April 12, 2013, the JRP issued a preliminary list of 199 conditions for the planning, construction and operation of the Northern Gateway project.

Now Kinder Morgan is worried. Denstedt’s letter notes:

we believe a number of the proposed conditions may have a material impact on pipeline and infrastructure development in Canada and consideration should be given to the conditions from this perspective.

Diplomatically, Denstedt goes on to tell the panel:

Our comments are intended to assist the JRP in understanding the potential outcomes of the proposed conditions if they become generally applicable to industry.

Commercial considerations

Under what Detstadt calls “Commercial considerations”, Kinder Morgan says “we observe that several of the proposed conditions are likely to affect the manner and risks involved in procuring pipeline facilities and services.

The list points to

Three layer composite coating or high performance composite coating is required for the entire pipeline although other pipeline coatings are commonly used in the pipeline industry depending upon ground conditions encountered
.
Complementary leak detection systems must be identified that can be practically deployed over extended distances of pipeline.

The construction of purpose-built tugs involves significant cost and lead time

A volume is prescribed for the secondary containment facilities at the marine terminal without reference to existing codes.

The letter goes on to say that if the conditions proposed by the JRP for the Northern Gateway come into effect, in Kinder Morgan’s opinion, it could adversely affect other pipeline projects in the future.

If broadly applied to industry, such conditions may limit the ability of pipeline companies to obtain competitive quotes because there are few sources of the required materials or services. The effect of conditions that require the use of a particular material or service may be to grant commercial benefits to certain suppliers through the regulatory process beyond the requirements of existing codes. Since several export pipelines are currently proposed, there will be a heightened demand for labour and materials in the coming years. The commercial effect of conditions that may exacerbate shortages of labour and materials should be a relevant consideration for the JRP.

Timing

 

One of Kinder Morgan’s objections is to the timing the JRP proposes for the Northern Gateway project if it applies to other pipelines.

Several of the proposed conditions contain NEB approval requirements and filings deadlines several years prior to operations. For example, plans related to the marine terminal and research programs must be filed for NEB approval three years prior to operations.

We are concerned that requiring reports to be filed for approval several years before operations can create significant schedule risks for infrastructure development projects. For example, a project with a two year construction schedule could take three years to complete with such conditions. Any changes to the construction schedule and anticipated date of operations would affect the filing deadline. Project proponents need sufficient schedule certainty in order to plan major expenditures on labour and materials.

To mitigate such risks, it is relevant for regulators to consider whether the filing deadlines and approval requirements prescribed in conditions could materially alter a project’s schedule. Filing deadlines should be set at a reasonable time before operations in order to minimize the risk that such deadlines materially affect the critical path for a project.

Many of the conditions require NEB approval, and in some cases the participation of other parties in the approval process, in order to be satisfied. Fulfillment of those conditions will require additional time, a Board process and potentially litigation. For example, certain reports must be filed with the NEB for approval prior to commencing construction activities. Other conditions require reports to be filed for approval by the NEB prior to construction with a summary of how concerns from other government agencies and Aboriginal groups were addressed.

So Kinder Morgan says:

In our view, conditions that require subsequent board approvals and that attract the potential for additional regulatory processes should be the exception and not a new standard or norm. There must be clear, well understood rationales given as to why additional approvals are in the public interest.

And so Kinder Morgan asks:

As an alternative, the NEB may utilize its existing powers and processes to ensure that when filings are made to satisfy imposed conditions an additional approval process is not required.

Overall the company sees the rules for Northern Gateway as a step back to the days before deregulation.

A number of the conditions may be interpreted as reflecting a return to a prescriptive approach to regulation. These conditions prescribe detailed audit requirements instead of setting a goal oriented approach to allow the proponent flexibility in mitigating any adverse effects. Such conditions tend to focus on operational aspects that are covered by existing codes and regulations rather than setting goals for the proponent to mitigate any significant adverse effects.

Denstedt, again diplomatically, concludes by saying:

Kinder Morgan wishes to thank the JRP for the opportunity to present these high level perspectives regarding its proposed conditions. Our comments are intended to ensure that the wider implications of the proposed conditions on the pipeline industry and infrastructure development are given appropriate consideration in the deliberations and final recommendations of the JRP.

Kinder Morgan letter to JRP

From the Orange Coast: The pollsters lost big in the BC election–but not for the reason everyone is talking about

Updated with clarification

The pollsters were the biggest losers in the British Columbia provincial election on May 14—but not in the way everyone is talking about.

It’s clear to the Wednesday morning quarterbacks that the big issue in BC was the economy, and voters chose that economy over the environment.

That’s where the pollsters failed and have failed time and time again for the past decade. As long as the pollsters keep asking the stupid question “What’s more important the environment or the economy?” a majority of voters, especially in uncertain times, will choose the economy. Politicians will campaign, as Christy Clark did brilliantly, by promising that there are better economic days ahead, putting the environment far down the priority  list.

By the time Canadians and all human beings realize that a viable economy is based on a sustainable environment it may be too late to save either.

The Liberal majority under Christy Clark was a big surprise; the polling data indicated, at first, that there would be a big NDP majority and in the final days that the Adrian Dix and the NDP would sneak into the Legislature still in majority territory.

Instead, Christy Clark, who until (if) she finds a seat, will be running the province as premier from the legislature galleries.

The BC free-enterprise coalition is satisfied, for the moment. The usual cabal of University of Calgary economic pundits are cheering for their sponsors in the oil patch, with the National Post,  Globe and Mail  and Sunmedia acting as their echo chamber. (Why the eastern media insist on always having Calgary academics write about BC is rather mind boggling. If they want ultra conservative BC point of view, there’s always the Fraser Institute, but even the Fraser Institute is junior to Alberta it seems)

The trouble is that the eastern establishment mainstream media are as out of touch as the pollsters.  The Globe and Mail editorial, like most of the eastern media, once again sees British Columbia as nothing more than a junior partner in Confederation, existing to serve the interests of Alberta, with the concerns about our future secondary.

 It now falls to Ms. Clark, who was cagey about her position on the Trans Mountain project, to take an objective look at the proposal, let go of her populist, B.C.-first rhetoric, and ensure that her government is an open-minded partner with Alberta in its bid to get its oil to tidewaters for export. Any reviews of the pipeline project must be done quickly and with a deadline.

It’s just plain unmitigated arrogance, but rather typical,  to tell a premier who just won  a majority in the legislature and the popular vote to “let go of her populist BC-first rhetoric.”

 

Christy Clark
Christy Clark laughs at a joke at the Kitimat Valley Institute, April 4, 2013, where she announced her plan to eliminate the provincial debt in 15 years via taxes and other payments from LNG (Robin Rowland)

The liquifaction factor

There’s one big problem, a very big problem, with Clark’s promises. She opened her campaign in Kitimat by promising that the liquified natural gas developments will not only slay the deficit but pay down the BC provincial debt in 15 years.

I asked Clark in the media scrum after her announcement how she could make such a prediction when the LNG market is so volatile. She replied that her predictions were based on very conservative estimates. That was spin.

Clark based her election campaign on a promise that not only hopes to foretell the future for the next fifteen years but on liquifaction.

Now liquifaction has two meanings. First is the freezing of natural gas to LNG. Second is the problem that occurs during an earthquake when water saturated ground turns into a liquid, bringing about the collapse of countless buildings with the death and injury that follows.
Clark based her campaign on the hope that the LNG market will not liquify—as in the second meaning.

The LNG market looked so simple two years ago. Buy natural gas at low North American prices, pipeline it to the west coast, load it on tankers and sell it in Asia at the higher natural gas price there which is based on the price of oil. But, wait, the free market doesn’t work that way (sorry free enterprise coalition). Customers in Asia don’t want to pay the full oil-based price for natural gas if they can get it via the US Gulf ports at a cost plus North American price. If the export price of LNG falls, even if the BC projects proceed, the price will be a lot lower than Clark and the energy cheerleaders expect and there will be no new golden age for the BC economy.

Changes in the LNG market are happening at warp speed and it is hard to keep up (And many people in Kitimat are trying to keep up with the daily volatility since the future of the town may depend on LNG). Unfortunately, the dying mainstream media failed to explain, even in the simplest terms, that Christy Clark’s LNG promises might be as empty as a mothballed tanker. This is one case where concentrating on the horse race—and the grossly inaccurate polls—was a blunder, when there should have been reality checks on the LNG promise. The conservative cheerleaders in the media actually didn’t do their readers much good when they failed as  reporters to check out the real state of the energy industry or predicted economic catastrophe if there was an NDP victory.

The NDP failure

The NDP campaign under Adrian Dix was not up to its appointed task of explaining the need for both a viable economy and a sustainable environment.  Most pundits point to Dix’s  mid-campaign switch to opposing the Kinder Morgan pipeline expansion as the beginning of the NDP decline.

More telling, for me, was Dix’s failure to explain the proposed two-year moratorium on fracking. There are lots of moratoriums and holds on fracking in North America and around the world. The Canadian media, however, failed miserably (if it even bothered to check) that fracking moratoriums are becoming a standard, although controversial, practice worldwide. A moratorium on fracking today is prudent given the uncertainty over current practices.

Yes, fracking has been used for 50 years but on a much smaller scale. There are two new factors. First is the sheer volume of operations, with no idea what the massive increase in fracking will do to the environment, especially the ground water. Second is the stubborn refusal of companies to release proprietary information on the chemicals they use—the same “public be damned”  attitude toward environmental concerns that has got pipeline companies in trouble as well.

Christy Clark and the conservative commentators successfully painted the fracking moratorium as stopping all economic development in the province. Dix and the NDP completely failed to emphasize that their platform was that the party wanted industrial development in the province, but didn’t want to rush into development that will cost the province and its taxpayers down the road. (And taxpayers will eventually have to pay to clean up unfettered development long after the companies that profited have left town, something deficit and debt hawks always conveniently ignore.)

The Orange Coast

The Orange coast
BC election map shows the coastal areas where tankers and pipelines are the biggest issue went solidly for the NDP

As Tyler Noble (formerly with CFTK News and now with the District of Kitimat) pointed out in a Facebook post, the electoral map shows perhaps the real story of the election. The British Columbia coast is entirely NDP orange. The Interior of BC went Liberal. The fight over tankers and pipelines is not going to go away with the result of this election, it’s going to get louder and a lot nastier.

So the University of Calgary pundits, the conservative columnists and editorialists from Calgary to Toronto and the Globe and Mail editorial board will soon have to forget their cheers and go back to complaining about the BC peasants who have to be “educated” about how good pipelines are for the economy.

The polls

The pollsters are now trying to find out what went wrong, and beginning to ask how to find out who will actually turn up at the voting booth?

Even with the problems pollsters face with call display refusals, fewer landlines and the possible unreliability of internet panel polling, even with the flawed polling data some things are clear.

The turnout, as currently reported, was 52 per cent. The student vote (an actual vote) went heavily to the NDP and the Greens. Part of the student vote result is traditionally, younger people generally tend to vote “progressive” parties. Young people, increasingly disillusioned by partisan politics, are not turning out to actually vote. With high unemployment among millennials and teenagers, these potential voters want jobs, but they’re also worried about the future of the planet. They’re not turning out to vote because many say they have no one to vote for (despite the appeals of the NDP and the Greens.)

Many older people, both on the left and the right are trapped in an obsolete world view of progressive views versus big business or the dreaded socialism versus free enterprise. Older people, worried about their economic future do vote and are often more small c conservative.

Clark campaigned on that paradigm and she won.

Be careful for what you wish for.

The failure of the economy vs environment question

It may be that by the next federal election in 2015 and by the next BC election in 2017, there might be, it is hoped, a profound change in the political narrative. If the pollsters hadn’t asked that obsolete and stupid question about the environment verus the economy, business versus socialism, they might actually have had some good data in this election.

The times, as Bob Dylan sang, they are a changing. The paradigm is shifting. In just the past few months there are hints of the rise of a growing “green conservative” movement.

Preston Manning, the founder and first leader of the Reform Party is now promoting the “green conservative”

In the United States, green conservatives are adding to the ruptures in the Republican Party. There is even a branch of the Christian Coalition, that is splintering because it too supports the idea of green values because it sees green as supporting family values, helping the poor and the idea of stewardship.

We see lots of green conservatives here in northwest BC among the hunters, fishers and fishing guides and those who work in the industrial sector who like hunting, fishing, hiking and boating. Did they vote for the NDP or the Liberals?  Usually the sample size in northwest BC is too small, but drilling down might indicate that there were  enough green conservatives who voted for what should now be called the Orange Coast.

If Adrian Dix and the NDP had campaigned effectively with an eye on the green conservatives, there might actually be an NDP majority. If Christy Clark actually keeps her hints of a possible tilt toward green conservatism and moves away from the free enterprise at any cost faction of the Liberals (including that 801 coalition that died at 802), she might actually be in for a long run as BC premier.

If, on the other hand, as the Globe and Mail advocates this morning, if Clark does move,  bowing to Alberta’s demands, toward more unfettered development, as environmentalists fear and the aging free entrerprisers would love, the next provincial election will be one to watch, perhaps with the Greens filling a vacuum created by the Liberals and the NDP.

As for the pollsters, there have been two major failures in Canada, the BC and Alberta elections. The pollsters were wrong about the Israeli election as well, which means polling failure is not confined to Canadian politics. It’s time for the pollsters to stand down, go back to the beginning, and take a look at all their practices, including the basic questions they are asking and to wonder if the questions reflect an unconscious bias in favour of the party paying for the poll (good professional pollsters do usually try to avoid open bias question sequences).

If the polling companies don’t change, they too will soon follow the dying mainstream media into oblivion, so neither will be around to see a possible future where the concerns for the environment are a given and the debate is over the real solution to stave off catastrophe.

 

This post has been updated to clarify that those who I call Conservative cheerleaders failed to be clear about the energy industry, not the overall campaign.

 

 

 

 

 

 

Analysis: The Harper government’s week of history-making blunders

The Panama registered bulk carrier  Azuma Phoenix is seen tied up at Kitimat harbour seen on the afternoon of Jan 9, 201. In March 2013. the federal government announced it was making the private port of Kitimat into a public port,  (Robin Rowland)
The Panama registered bulk carrier Azuma Phoenix is seen tied up at Kitimat harbour on the afternoon of Jan 9, 2012. In March 2013. the federal government announced it was making the private port of Kitimat into a public port. (Robin Rowland)

When the story of the Stephen Harper government is told, historians will say that the week of March 17 to 23, 2013, is remembered, not for the release of a lacklustre federal budget, but for day after day of political blunders that undermined Harper’s goal of making a Canada what the Conservatives call a resource superpower.

It was a week where spin overcame substance and spun out of control.

The Conservative government’s aim was, apparently, to increase support for the Enbridge Northern Gateway pipeline project with a spin campaign aimed at moving the middle ground in British Columbia from anti-project to pro-project and at the same time launching a divide and conquer strategy aimed at BC and Alberta First Nations.

It all backfired. If on Monday, March 17, 2013, the troubled and controversial Enbridge Northern Gateway project was on the sick list, by Friday, March 23, the Enbridge pipeline and tanker scheme was added to the Do Not Resuscitate list, all thanks to political arrogance, blindfolded spin and bureaucratic incompetence. The standard boogeymen for conservative media in Canada (who always add the same sentence to their stories on the Northern Gateway) “First Nations and environmentalists who oppose the project” had nothing to do with it.

Stephen Harper has tight control of his party and the government, and in this case the billion bucks stop at the Prime Minister’s Office. He has only himself to blame.

All of this happened on the northern coast of British Columbia, far out of range of the radar of the national media and the Ottawa pundit class (most of whom, it must be admitted, were locked up in an old railway station in the nation’s capital, trying interpret Finance Minister Jim Flaherty’s spreadsheets).

The story begins early on that Monday morning, at my home base in Kitimat, BC, the proposed terminal for Northern Gateway, when a news release pops into my e-mail box, advising that Natural Resources Minister Joe Oliver would be in nearby Terrace early on Tuesday morning for an announcement and photo op.

I started making calls, trying to find out if anyone in Kitimat knew about Oliver’s visit to Terrace and if the minister planned to come to Kitimat.

Visitors to Kitimat

I made those calls because in the past two years, Kitimat has seen a parade of visitors checking out the town and the port’s industrial and transportation potential. The visitors range from members of the BC provincial Liberal cabinet to the staff of the Chinese consulate in Vancouver to top executives of some of the world’s major transnational corporations (and not just in the energy sector). Most of these visits, which usually include meetings with the District of Kitimat Council and District senior staff as well as separate meetings with the Council of the Haisla Nation, are usually considered confidential. There are no photo ops or news conferences. If the news of a visit is made public, (not all are), those visits are usually noted, after the fact, by Mayor Joanne Monaghan at the next public council meeting.

It was quickly clear from my calls that no one in an official capacity in Kitimat knew that, by the next morning, Oliver would be Terrace, 60 kilometres up Highway 37. No meetings in Kitimat, on or off the record, were scheduled with the Minister of Natural Resources who has been talking about Kitimat ever since he was appointed to the Harper cabinet.

I was skeptical about that afternoon’s announcement/photo op in Vancouver by Transport Minister Denis Lebel and Oliver about the “world class” tanker monitoring.

After all, there had been Canadian Coast Guard cutbacks on the northwest coast even before Stephen Harper got his majority government. The inadequacy of oil spill response on the British Columbia coast had been condemned both by  former Auditor General Sheila Fraser and in the United States Senate. The government stubbornly closed and dismantled the Kitsilano Coast Guard station. It’s proposing that ocean traffic control for the Port of Vancouver be done remotely from Victoria,  with fixed cameras dotted around the harbour.  Leaving controllers in Vancouver would, of course, be the best solution, but they must be sacrificed (along with any ship that get’s into trouble in the future, on the altar of a balanced budget).

The part of the announcement that said there would be increased air surveillance is nothing more than a joke (or spin intended just for the Conservative base in Alberta, Saskatchewan and the Toronto suburbs,that is not anyone familiar with BC coastal waters). Currently the Transport Canada surveillance aircraft are used on the coasts to look for vessels that are illegally dumping bilge or oil off shore. As CBC’s Paul Hunter reported in 2010, Transport Canada aircraft were used after the Gulf of Mexico oil disaster to map where the oil was going after it erupted from the Deepwater Horizon. 

Given the stormy weather on the west coast (when Coast Guard radio frequently warns of “hurricane force winds”) it is highly unlikely that the surveillance aircraft would even be flying in the conditions that could cause a major tanker disaster. Aerial surveillance, even in good weather, will never prevent a tanker disaster caused by human error.

I got my first chance to look at the Transport Canada website in late afternoon and that’s when a seemingly innocuous section made me sit up and say “what is going on?” (I actually said something much stronger).

Public port

Public port designations: More ports will be designated for traffic control measures, starting with Kitimat.

(Transport Canada actually spelled the name wrong—it has since been fixed—as you can see in this screen grab).

Screengrab from Transport Canada website

Kitimat has been one of the few private ports in Canada since the Alcan smelter was built and the town founded 60 years ago (the 60th anniversary of the incorporation of the District of Kitimat is March 31, 2013).

The reasons for the designation of Kitimat as a private port go back to a complicated deal between the province of British Columbia and Alcan in the late 1940s as the two were negotiating about electrical power, the aluminum smelter, the building of the town and the harbour.

For 60 years, Alcan, later Rio Tinto Alcan, built, paid for and operated the port as a private sector venture. For a time, additional docks were also operated by Eurocan and Methanex. After Eurocan closed its Kitimat operation that dock was purchased by the parent company Rio Tinto. The Methanex dock was purchased by Royal Dutch Shell last year for its proposed LNG operation.

The announcement that Kitimat was to become a public port was also something that the national media would not recognize as significant unless they are familiar with the history of the port. That history is known only to current and former residents of Kitimat and managers at Rio Tinto Alcan.

The port announcement came so much out of left field; so to speak, that I had doubts it was accurate. In other words, I couldn’t believe it. I went to Monday evening’s meeting of District of Kitimat Council and at the break between the open and in-camera sessions, I asked council members if they had heard about Kitimat being redesignated a public port. The members of the district council were as surprised as I had been.

Back from the council meeting, I checked the Transport Canada news release and backgrounders. I also checked the online version of Bill C-57, the enabling act for the changes announced earlier that day. There was no mention of Kitimat in Bill C-57.

Harper government outlines new tanker safety measures for west coast

Confirmation

Tuesday morning I drove to Terrace for Joe Oliver’s 9 am photo op and the announcement at Northwest Community College (NWCC) that the government had appointed Douglas Eyford as a special envoy to First Nations for energy projects, an attempt on the surface to try and get First Nations onside for the pipeline projects, an appointment seen by some First Nations leaders as an attempt by the Harper government to divide and conquer.

As an on site reporter, I got to ask Oliver two questions before the news conference went to the national media on the phones.

In answer to my first question, Oliver confirmed that the federal government had decided to make Kitimat a public port, saying in his first sentence: “What the purpose is to make sure that the absolute highest standards of marine safety apply in the port of Kitimat.” He then returned to message track saying, “we have as I announced yesterday and I had spoken about before at the port of Vancouver we have an extremely robust marine safety regime in place but we want to make sure that as resource development continues and as technology improves, we are at the world class level. As I also mentioned there has never been off the coast of British Columbia a major tanker spill and we want to keep that perfect record.”

For my second question, I asked Oliver if he planned to visit Kitimat.

He replied. “Not in this particular visit, I have to get back [to Ottawa] There’s a budget coming and I have to be in the House for that but I certainly expect to be going up there.”

The question may not have registered with the national media on the conference call. For the local reporters and leaders in the room at Waap Galts’ap, the long house at Terrace’s Northwest Community College, everyone knew that Kitimat had been snubbed.

Oliver confirms Kitimat to become a public port

Back in Kitimat, I sent an e-mail to Colleen Nyce, the local spokesperson for Rio Tinto Alcan noting that Joe Oliver had confirmed that the federal government intended to make the RTA-run port a public port. I asked if RTA had been consulted and if the company had any comment.

Nyce replied that she was not aware of the announcement and promised to “look into this on our end.” I am now told by sources that it is believed that my inquiry to Nyce was the first time Rio Tinto Alcan, one of Canada’s biggest resource companies, had heard that the federal government was taking over its port.

The next day, Kitimat Mayor Joanne Monaghan told local TV news on CFTK the Kitimat community was never consulted about the decision and she added that she still hadn’t been able to get anyone with the federal government to tell her more about the plan.

Who pays for the navigation aids?

Meanwhile, new questions were being raised in Kitimat about two other parts of the Monday announcement.

New and modified aids to navigation: The CCG will ensure that a system of aids to navigation comprised of buoys, lights and other devices to warn of obstructions and to mark the location of preferred shipping routes is installed and maintained.
Modern navigation system: The CCG will develop options for enhancing Canada’s current navigation system (e.g. aids to navigation, hydrographic charts, etc) by fall 2013 for government consideration.

Since its first public meeting in Kitimat, in documents filed with the Northern Gateway Joint Review Panel, in public statements and advertising, Enbridge has been saying for at least the past four years that the company would pay for all the needed upgrades to aids to navigation on Douglas Channel, Wright Sound and other areas for its tanker traffic. It is estimated that those navigation upgrades would cost millions of dollars.

Now days before a federal budget that Jim Flaherty had already telegraphed as emphasizing restraint, it appeared that the Harper government, in its desperation to get approval for energy exports, was going to take over funding for the navigation upgrades from the private sector and hand the bill to the Canadian taxpayer.

Kitimat harbour

RTA not consulted

On Thursday morning, I received an e-mail from Colleen Nyce with a Rio Tinto Alcan statement, noting:

This announcement was not discussed with Rio Tinto Alcan in advance. We are endeavoring to have meetings with the federal government to gain clarity on this announcement as it specifically relates to our operations in Kitimat.

Nyce also gave a similar statement to CFTK and other media. A Francophone RTA spokesperson in Quebec did the same for Radio Canada.

On Friday morning, Mayor Monaghan told Andrew Kurjata on CBC’s Daybreak North that she had had at that time no response to phone calls and e-mails asking for clarification of the announcement. Monaghan also told CBC that Kitimat’s development officer Rose Klukas had tried to “get an audience with minister and had been unable to.” (One reason may be that Oliver’s staff was busy. They ordered NWCC staff to rearrange the usual layout of the chairs at Waap Galts’ap, the long house, to get a better background for the TV cameras for Oliver’s statement).

Joe Oliver
Natural Resources Minister Joe Oliver (front far right) answers questions after his news conference at the Northwest Community College Long House, March 19, 2013. (Robin Rowland)

Monaghan told Kurjata, “I feel like it’s a slap in the face because we’re always being told that we’re the instrument for the whole world right now because Kitimat is supposed to be the capital of the economy right now. So I thought we’d have a little more clout by now and they’d at least tell us they were going to do this. There was absolutely no consultation whatsoever.”

By Friday afternoon, five days after the announcement, Transport Canada officials finally returned the calls from Mayor Monaghan and Rose Klukas promising to consult Kitimat officials in the future.

Monaghan said that Transport Canada told her that it would take at least one year because the change from a private port to a public port requires a change in legislation.

Transport Canada is now promising “extensive public and stakeholder consultation will occur before the legislation is changed,” the mayor was told.

On this Mayor Monaghan commented, “It seems to me that now they want to do consultation….sort of like closing the barn door after all of the cows got out!”

Transport Canada promises consultation on Kitimat port five days after announcement it will become public

 

Blunder after blunder after blunder

Blunder No 1. Pulling the rug out from Northern Gateway

Joe Oliver and the Harper government sent a strong political signal to Kitimat on Tuesday; (to paraphrase an old movie) your little town doesn’t amount of a hill of beans in this crazy world.

Not that attitude is new for the people of Kitimat. The Northern Gateway Joint Review panel snubbed the town, bypassing Kitimat for Prince George and Prince Rupert for the current questioning hearings. Publisher David Black has been touting a refinery 25 kilometres north of Kitimat to refine the bitumen, but has never bothered to meet the people of Kitimat.

There are a tiny handful of people in Kitimat openly in favour of the Northern Gateway project. A significant minority are on the fence and some perhaps leaning toward acceptance of the project. There is strong opposition and many with a wait and see attitude. (Those in favour will usually only speak on background, and then when you talk to them most of those “in favour” have lists of conditions. If BC Premier Christy Clark has five conditions, many of these people have a dozen or more).

Oliver was speaking in Terrace, 60 kilometres from Kitimat. It is about a 40 to 45 minute drive to Kitimat over a beautiful stretch of highway, with views of lakes, rivers and mountains.

Scenic Highway 37 is the route to the main location not only for the controversial Northern Gateway pipeline but three liquefied natural gas projects, not to mention David Black’s proposed refinery half way between Terrace and Kitimat.

Why wouldn’t Kitimat be a must stop on the schedule for the Minister of Natural Resources? In Terrace, Oliver declared that Kitimat was to become a public port, run by the federal government. Although technically that would be the responsibility of Denis Lebel, the Minister of Transport, one has to wonder why the Minister of Natural Resources would not want to see the port that is supposedly vital to Canada’s economy? You have to ask why he didn’t want to meet the representatives of the Haisla Nation, the staff and council of the District of Kitimat and local business leaders?

Oliver has been going across Canada, the United States and to foreign countries promoting pipelines and tanker traffic, pipelines that would terminate at Kitimat and tankers that would send either bitumen or liquefied natural gas to customers in Asia.

Yet the Minister of Natural Resources is too important, too busy to take a few hours out of his schedule, while he is in the region,  to actually visit the town he has been talking about for years.

He told me that he had to be in Ottawa for the budget. Really? The budget is always the finance minister’s show and tell (with a little help from whomever the Prime Minister is at the time). On budget day, Oliver would have been nothing more than a background extra whenever the television cameras “dipped in” on the House of Commons, between stories from reporters and experts who had been in the budget lockup.

According to the time code on my video camera, Oliver’s news conference wrapped at 9:50 a.m., which certainly gave the minister and his staff plenty of time to drive to Kitimat, meet with the representatives of the District, the Haisla Nation and the Chamber of Commerce and still get to Vancouver for a late flight back to Ontario.

On Tuesday, Joe Oliver’s snub pulled the political rug out from under the Northern Gateway supporters and fence sitters in Kitimat. Oliver’s snub showed those few people in Kitimat that if they do go out on a limb to support the Northern Gateway project, the Conservatives would saw off that limb so it can be used as a good background prop for a photo op.

Prince Rupert, Terrace and Smithers councils have all voted against the Northern Gateway project. Kitimat Council, despite some clear divisions, has maintained a position of absolute neutrality.  Kitimat Council will continue to be officially neutral until after the Joint Review report, but this week you could hear the air slowly leaking out of the neutrality balloon.

Oliver may still believe, as he has frequently said, that the only people who oppose Northern Gateway are dangerous radicals paid by foreign foundations.

What he did on Tuesday was to make the opposition to Northern Gateway in Kitimat into an even more solid majority across the political spectrum.

Blunder No 2. Rio Tinto Alcan

It doesn’t do much for the credibility of a minister of natural resources to thoroughly piss off, for no good reason, the world’s second largest mining and smelting conglomerate, Rio Tinto. But that’s just what Joe Oliver did this week.

I am not one to usually have much sympathy with rich, giant, transnational corporations.

But look at this way, over the past 60 years Alcan and now Rio Tinto Alcan have invested millions upon millions of dollars in building and maintaining the Kitimat smelter and the port of Kitimat. RTA is now completing the $3.3 billion Kitimat Modernization Project. Then without notice, or consultation, the Conservative government—the Conservative government—announces it is going to take over RTA’s port operations. What’s more, if what Transport Canada told Mayor Joanne Monaghan is correct, the federal government is going to start charging RTA fees to use the port it has built and operated for 60 years.

Construction at Rio Tinto Alcan

There are problems between the people of Kitimat and RTA to be sure; the closing of the town’s only beach last summer was one problem (a problem that was eventually resolved.)

Too often RTA’s London headquarters acts like it is still the nineteenth century and the senior executives are like British colonialists dictating to the far reaches of the Empire on what do to do.

No matter what you think of RTA, it boggles the mind, whether you are right wing, left wing or mushy middle, that the federal government simply issues a press release–a press release– with not even a phone call, not even a visit (even to corporate headquarters) saying “Hey RTA, we’re taking over.”

There’s one thing that you can be sure of, Rio Tinto Alcan’s lobbyists are going to be earning their fees in the coming weeks.

(One more point, even if there wasn’t a single pipeline project planned for Kitimat you would think that the Minister of Natural Resources would want to see what is currently the largest and most expensive construction project in Canada, a project that comes under his area of political responsibility).

Blunder No 3. The Haisla Nation

Douglas Channel is in the traditional territory of the Haisla Nation. The KM LNG project at Bish Cove is on Haisla Reserve No. 6  legally designated an industrial development by the federal government. Any changes to that project and to the Kitimat waterfront as a whole will require intensive negotiations with the Haisla Nation.

Blunder No 4. The state of Canadian democracy

It took five days, from the time of the minister’s news conference on Monday until Friday afternoon, for officials in Transport Canada to return phone calls from Mayor Joanne Monaghan and Rose Klukas, to explain what was going to happen to the Port of Kitimat.

This week was yet another example of the decay of Canadian democracy under Stephen Harper. Executives from Tokyo to Houston to the City of London quickly return phone calls from the District of Kitimat, after all Kitimat is where the economic action is supposed to be. At the same time, the federal government doesn’t return those calls, it shows that something really is rotten in our state.

Blunder No 5. LNG

There are three liquefied natural gas projects slated for Kitimat harbour, the Chevron-Apache partnership in KM LNG, now under construction at Bish Cove; the Royal Dutch Shell project based on the old Methanex site and the barge based BC LNG partnership that will work out of North Cove.

None of these projects have had the final go ahead from the respective company board of directors. So has the federal government thrown the proverbial monkey wrench into these projects? Will making Kitimat a public port to promote Enbridge, help or hinder the LNG projects? Did the Ministry of Natural Resources even consider the LNG projects when they made the decision along with Transport Canada to take over the port?

And then there’s…..

Kitimat has a marina shortage, especially since RTA closed the Moon Bay Marina. The only one left, the MK Bay Marina, which is straining from overcapacity, is owned by the Kitimat-Stikine Regional District. That means there will be another level of government in any talks and decisions on the future of the Kitimat harbour. There are also the controversial raw log exports from nearby Minette Bay.

Although Transport Canada has promised “extensive public and stakeholder consultation,” one has to wonder how much input will be allowed for the residents of Kitimat and region, especially the guiding and tourism industries as well as recreational boaters. After all, the Harper government is determined to make Kitimat an export port for Alberta and the experience of the past couple of years has shown that people of northwest count for little in that process. Just look at the Northern Gateway Joint Review, which more and more people here say has no credibility.

Big blunder or more of the same?

I’ve listed five big blunders that are the result of the decision by the Harper government to turn Kitimat into a public port.

Are they really blunders or just more of the same policies we’ve seen from Stephen Harper since he became a majority prime minister?

This is a government that has muzzled scientific research and the exchange of scientific ideas. The minister who was in the northwest last week, who has demonized respect for the environment, is now squeezing the words “science” and “environment” anywhere into any message track or speech anyway he can.

The government closes the busiest and most effective coast guard station at Kitsilano without consulting a single municipal or provincial official in British Columbia. The government closes two of Canada’s crown jewels of scientific research, the Experimental Lakes Area in Ontario and the Polar Environmental Research Laboratory in Nunavut. Keeping the coast guard station and the two science projects open and funded would be a drop in the deficit bucket at a time that the government is spending countless millions of taxpayers’ dollars in promoting itself on every television channel in Canada.

That’s just the point. Joe Oliver’s fly-in, fly-out trip to Terrace was not supposed to have any substance. Changing the chairs at the Waap Galts’ap long house showed that it was more important to the Harper government to have some northwest coast wall art behind Joe Oliver for his photo op than it was to engage meaningfully with the northwest, including major corporations, First Nations and local civic and business leaders.

Joe Oliver’s visit to Terrace was an example of government by reality television. The decision to change the private port of Kitimat into a public port was another example of Harper’s government by decree without consulting a single stakeholder. The problem is, of course, that for decades to come, it will be everyone in northwest British Columbia who will be paying for those 30 second sound bites I recorded on Tuesday.


Epilogue: Alcan’s legacy for the socialist Prime Minister, Stephen Harper

If an NDP or Liberal government had done what Harper and Oliver did on Monday, every conservative MP, every conservative pundit, every conservative media outlet in Canada would be  hoarse from screaming about the danger from the socialists to the Canadian economy.

That brings us to the legacy left by R. E. Powell who was president of Alcan in the 1940s and 50s as the company was building the Kitimat project.

As Global Mission, the company’s official history, relates, in 1951, Alcan signed an agreement with the British Columbia provincial government, that “called upon the company to risk a huge investment, without any government subsidy or financial backing and without any assured market for its product.”

According to the book, Powell sought to anticipate any future problems, given the tenor of the times, the possible or even likely nationalization of the smelter and the hydro-electric project.

So Powell insisted that the contract signed between Alcan and the province include preliminary clauses acknowledging that Alcan was paying for Kitimat without a single cent from the government:

Whereas the government is unwilling to provide and risk the very large amounts of money required to develop those water powers to produce power for which no market now exists or can be foreseen except through the construction of the facilities for the production of aluminum in the vicinity and….

Whereas the construction of the aluminum plant at or near the site of the said waterpower would accomplish without risk or to the GOVERNMENT the development power, the establishment of a permanent industry and the new of population and….

(Government in all caps in the original)

…the parties hereto agree as follows (the agreement, water licence and land permit)

Powell is quoted in the book as saying:

I asked the political leaders of BC if the government would develop the power and sell the energy to Alcan and they refused. We had to do it ourselves. Someday, perhaps, some politician will try to nationalize that power and grab it for the state. I will be dead and gone but some of you or your successors at Alcan may be here, and I hope the clauses in the agreement, approved by the solemn vote of the BC legislature, will give those future socialists good reason to pause and reflect.

In the late 1940s and early 1950s, the federal government had very little to do with the Kitimat project. With the declaration that Kitimat will be a public port, the federal government comes to the party 60 years late. But one has to wonder if the late Alcan president, R.E. Powell, ever considered that the “future socialists” he hoped would “pause and reflect” would be members of Canada’s Conservative party, Stephen Harper, Joe Oliver and Denis Lebel?