Christy Clark | Northwest Coast Energy News

How “On the Waterfront” could decide the fate of Enbridge’s Kitimat terminal

There’s one question about the Enbridge Northern Gateway project that many people ask and few can answer: Who is responsible for the port of Kitimat? Who would be liable should there be a disaster in the port? Nobody really knows.

Unlike many harbours in Canada, the port of Kitimat is “private,” although as the District of Kitimat says, “Transport Canada and other federal agencies continue to regulate navigation, security and environmental safety.” Kitimat has promoted that private status as an economic advantage.

If there’s a dispute, the question of responsibility and liability would probably end up in the Supreme Court of Canada, with the justices sorting out a historic puzzle. Or perhaps that historical puzzle could mean that the future of the port of Kitimat might be decided by the next B.C. provincial election.

Most of the other harbours in Canada are the responsibility of Ports Canada, a branch of Transport Canada or run by (usually not-for-profit) semi-public port corporations or local harbour commissions.

To find out why Kitimat is one of the few private ports in Canada, the first thing to do is watch Eliza Kazan and Bud Schulberg’s classic 1954 multiple Oscar winning movie, On the Waterfront, starring Marlon Brando, about how the mob ran the New York docks.

What has On the Waterfront got to do with Kitimat? It goes back to when the then Aluminum Company of Canada/Alcan (now Rio Tinto Alcan) was planning the Kitimat project; much of that work was done in New York both by employees and consultants. It was in 1949, that Malcolm Johnson, a New York Sun reporter, wrote a Pulitzer Prize winning series of investigative reports called “Crime on the Waterfront,” exposing corruption and Mafia involvement with the docks and the longshoremans’ union. The movie was based, in part, on that investigative series.

So in its planning, Alcan was determined that the longshore unions would not be involved in running the docks in Kitimat. The publicly stated reason has always been that Alcan wanted a seamless 24/7 operation that would be integrated with the aluminum smelter. Alcan would sign a collective agreement with the United Steelworkers that covered both the smelter and the docks. (CAW 2301 now represents most of the workers at the Kitimat smelter.)

When the Kitimat project was being finalized in 1949 and 1950 at the height of the Cold War, aluminum was a strategic commodity, security was high on the agenda, and it was not just the Soviet bloc but the mob as well that worried the authorities.

Add two factors. First, in 1949 the province of British Columbia was anxious to promote what would today be called a “mega-project.” Second, in the post-war era when corporations were relatively enlightened compared to today, Alcan was determined not to create the traditional “company town.”

To promote private-sector development of both hydro-electricity and aluminum, B.C. signed a rather loosely worded agreement with Alcan, noting that the project was going on “without investment by or risk to the government.” That agreement was implemented by the Legislative Assembly of B.C. by an equally wide open Industrial Development Act. One aim of both was try to ensure that future “socialists” would not expropriate the project.

Industrial township

With the province handing over the Crown land at the head of Douglas Channel at a very nominal price to Alcan, next came the creation of the District of Kitimat. With the town under construction, with few buildings and a small population, under normal B.C. practice, the area would be “unincorporated” and would not have a municipal government. But Alcan and the province came up with a new concept, which they called “an industrial township,” which would allow a municipal government to be established in anticipation of future growth.

The act that established the District of Kitimat put the boundaries outside the land owned by Alcan (excluding land reserved for the Haisla Nation).

Alcan began selling off the land in the planned areas of the town and other land it didn’t need. Individuals bought houses and businesses bought the land for their own use. Alcan retained ownership of the harbour and estuary lands and the small “Hospital Beach.”

The District of Kitimat has some legal responsibility for “wharfs” at the port of Kitimat. At council meetings, the environmental group, Douglas Channel Watch, has raised the question of the district’s responsibility and liability in case of an Enbridge incident but there’s been no definitive response from district staff. There is no municipal harbour commission as there is in other jurisdictions.

Up until recently, it was a convenient arrangement for everyone involved. Alcan, Eurocan and Methanex ran their dock operations without any interference, beyond standard Transport Canada oversight.

Things began to change in 2007, when the Rio Tinto Group bought Alcan, creating Rio Tinto Alcan. A couple of years ago, a senior staff source in the Canadian Auto Workers explained it to me it this way. “Alcan was a big corporation, but Alcan was a corporation with a big stake in Canada. As a union, we could do business with them. Rio Tinto is a transnational corporation with businesses in lots of countries but no stake in any of them. So it’s a lot harder now.”

With the Rio Tinto acquisition of Alcan, things tightened up in Kitimat. Negotiations between the District and RTA for the District to obtain more land stalled. Access to the estuary and other RTA lands that had been somewhat open under Alcan became more restrictive. In 2010, the Eurocan paper mill shut down along with its dock. In 2011, Rio Tinto bought the dock from West Fraser, owner of Eurocan. The Kitimat community noted that when the dock was repainted, it said just “Rio Tinto.” not “Rio Tinto Alcan” and that led to lots of gossip and wondering about what the Rio Tinto Group really plans for Kitimat. Last fall, Shell Canada purchased the former Methanex dock for part of its liquified natural gas operations.

With the Enbridge Northern Gateway project, the BC LNG project at North Cove and the KM LNG project at Bish Cove all along the shore of Douglas Channel and within the boundaries of the District of Kitimat which extends as far south as Jesse Lake, the question that has to be asked is, what happens now? If the Enbridge project is built, it will start just beyond the boundaries of the land owned by Rio Tinto Alcan.

That old arrangement between Alcan and the District of Kitimat is facing many new challenges.

The district once had a harbour master, but the position was eliminated because he had nothing to do. Alcan owned its docks, Alcan managed the docks and Alcan union employees worked on the docks. Later came the Eurocan (now owned by Rio Tinto) and Methanex (now owned by Shell) docks, again owned and operated by private corporations.

The District of Kitimat, nominally in charge, was content to sit back and collect taxes.

With the Enbridge Northern Gateway project, the B.C. LNG project at North Cove and the KM LNG project at Bish Cove all along the shore of Douglas Channel and within the boundaries of the District of Kitimat, the question that has to be asked is, what happens now? If the Enbridge project is built, it will start just beyond the boundaries of the land owned by Rio Tinto Alcan.

In Canada, ports and harbours are normally under federal jurisdiction and Transport Canada has oversight. But Alcan’s “private port” and the District of Kitimat were created by acts passed by the B.C. government.

The original agreement between the province and Alcan mentions an “aluminum plant” and “low-cost electrical power,” it doesn’t mention bitumen or liquified natural gas. Those provincial acts do not cover bitumen, supertankers and liquified natural gas.

B.C. Opposition Leader Adrian Dix has made it clear that his New Democratic Party opposes the Northern Gateway project. The federal government has said the province can’t really do anything to stop Enbridge Northern Gateway once Stephen Harper has decided that the pipeline project is in the national interest.

At this moment, Dix is a “contender” for the premiership, with Christy Clark and the B.C. Liberals dropping in the polls and with key members of her government deciding not to run in the election next spring.

So, if, as expected, Adrian Dix becomes the next B.C. premier, he has one very strong hand to play. Any act can, with proper legal advice, be amended by the B.C. legislature. That means the “socialists” so feared by Alcan and the premier of the day, Byron “Boss” Johnson, could alter the 1949 law. That in turn may upset the decades-old arrangement that created the private port which Enbridge is banking on.

Province of BC refuses to provide witnesses for Gateway Joint Review hearings

The province of British Columbia has refused requests from some of the intervenors in the Northern Gateway Joint Review to provide witnesses for cross-examination during the final stages of the hearings.

In a letter to the JRP dated on July 20, and posted recently on the JRP website, Christopher Jones, counsel for the province in the hearings says: “I write only to note that the province is an intervnor, not a government participant. Also as the province has not filed evidence, it will not be providing witnesses for cross-examination at the final hearings.”

It was just four days later that Premier Christy Clark and members of her cabinet, in releasing the Liberal government’s five conditions for the Northern Gateway project which called for “Successful completion of the environmental review process.” The provincial government has consistently refused to take part in the proceedings, and with the credibility of the Joint Review process already under question because of the limitations on reviews in Stephen Harper’s Bill C-38, BC’s continued refusal to participate can only further undermine that credibility.

Province of British Columbia Questioning at Final Hearings (pdf)

Alison Redford accuses BC of “dividing Canada” with pipeline conditions

The premier of Alberta, Alison Redford, has released a stinging news release on the conditions outlined by British Columbia for pipelines crossing the province and tanker traffic on the coast.

A key phrase in the release says:

Leadership is not about dividing Canadians and pitting one province against another—leadership is about working together. That’s when our country benefits—that’s when Canada leads. Through a Canadian Energy Strategy, the provinces and territories together will reach their full energy potential and contribute to increased prosperity and a higher standard of living for all Canadians.”

Political analysts are interpreting Redford’s statement with its references to “free trade” as meaning that Alberta has rejected BC’s demand for a “fair share” of energy revenue.

The Globe and Mail quotes Alberta’s Official Opposition leader, Danielle Smith of the Wildrose party, as saying BC . should be looking for more money from the federal government.

In Ottawa, the pro-pipeline Minister of Natural Resource, Joe Oliver, issued an unremarkable statement promoting responsible resource development that managed to avoid mentioning the BC announcement; a statement that could be regarded as a classical press release that says absolutely nothing.

Here is the complete news release as posted on the premier’s website:

Premier Alison Redford issued the following statement following the Government of British Columbia’s announcement regarding the Northern Gateway Pipeline:

Alberta is committed to building our country and cementing Canada’s position as a global energy superpower. Leadership is about working together, and that’s when our country benefits from our energy economy.

Today, the Government of British Columbia released a list of requirements to be met to satisfy their concerns about the perceived environmental risks associated with the Northern Gateway Pipeline. Every Canadian, no matter what province they call home, expects that energy development is done with a high degree of environmental safeguards. This is why a rigorous environmental review is underway by the National Energy Board. It is why the company involved has committed an additional $500 million for increased monitoring and safety measures. These efforts, combined with the fact that pipelines are still by far the safest means by which to transport oil, significantly mitigate the environmental risk and weaken the BC government’s argument for compensation based on potential risk.

As Alberta has said repeatedly, and as we saw in the recent report from the Senate’s Energy, Environment and Natural Resources Committee, accessing new energy markets is a national imperative. It is essential for the economic benefit of Canada.

Our confederation works as well as it does because of the free flow of goods and products through provinces and territories—including forest products, oil, liquefied natural gas, potash, uranium, grain and manufactured goods.

We’ve worked very hard through our New West Partnership to ensure free trade across the BC/Alberta/Saskatchewan borders and the shared economic rewards have been great for our citizens.

Leadership is not about dividing Canadians and pitting one province against another—leadership is about working together. That’s when our country benefits—that’s when Canada leads. Through a Canadian Energy Strategy, the provinces and territories together will reach their full energy potential and contribute to increased prosperity and a higher standard of living for all Canadians.”

BC’s desire for “world leading” marine standards collides with Harper’s C-38 chain saw massacre

Today BC Premier Christy Clark’s government outlined a series of “world leading” standards for environmental protection on the ocean and on land, if pipeline projects like the Northern Gateway and the Kinder Morgan expansion are to go ahead.

One has to wonder what Premier Clark told Prime Minister Stephen Harper when she gave him the “heads up” call on the new policy last week?

After all, the BC Liberal’s call for “world leading” standards comes just weeks after the Harper’s government, in Bill C-38, changed environmental assessment into a pro-industry process, gutted the Fisheries Act protection for habitat and severely cut back the Department of Fisheries and Oceans and Environment Canada.

So far, in the province of British Columbia, with both the governing Liberals and opposition New Democrats have been spectacularly unsuccessful in persuading the Harper government to reverse the closure of the Kitsilano Coast Guard station.

In the background paper released along with the news release on the five conditions for pipeline and tanker safety, the BC government is calling for greatly enhanced Coast Guard resources and tanker monitoring as well as payment for oil spill response.

Among the conditions for marine safety enhancement BC is asking:

Current response times and planning capacity are less stringent than other jurisdictions like Alaska and Norway. For example, for the types of tankers being proposed for Canada’s west coast, Alaska requires planning for 300,000 barrels. In Canada, response organizations are only required to maintain response plans for spills up to approximately 70,000 barrels (10,000 tonnes). Further, Alaska allows responders 72 hours to reach the spill site, while Canada allows 72 hours plus travel time, which can sometimes add days to the response.
In shared bodies of water, the United States’ requirements exceed Canada’s. For example, the United States requires escort tugs for laden tankers and mandates industry pay for designated and strategically placed emergency response tugs. Canada does not have any similar requirements.
Ensure the Canadian Coast Guard adopts a unified command/incident command structure.
The Canadian Coast Guard has a unique response system which is only used in B.C. The United States, companies and governments worldwide use a unified command/incident command response structure for a range of emergency responses, including marine spills. By bringing the Coast Guard under this system, an effective, co-ordinated response is better ensured while reducing layers of approvals that can delay critical, prompt decision-making.

At Enbridge community briefings in Kitimat last year, the company’s own marine experts said that the 72 hour response time from Vancouver and Victoria for a possible spill in the Douglas Channel was completely inadequate. In its fillings with the Joint Review Panel, Enbridge has proposed setting up and funding its own response stations along the BC coast, although so far, Enbridge has not provided any details on how the response stations would be set up and how they would work.

In 2010, the auditor general reported that Transport Canada and the Canadian Coast Guard have not used a consistent or systematic approach to tanker traffic and spills nor are there formal processes for ensuring that risks are reassessed.

Sheila Fraser found that

Procedures are not in place to verify the Canadian Coast Guard’s readiness. In other words, there is currently no process for providing assurance that the federal component of the oil spill response system is ready to respond effectively.
The Coast Guard had not conducted a comprehensive assessment of its response capacity since 2000.
The results of the Coast Guard’s response efforts—which range from identifying the source of pollution to full cleanup—are poorly documented. There are also limitations with the Coast Guard’s system for tracking oil spills and other marine pollution incidents. These gaps affect its ability to conduct reliable analysis of trends in spills and know how well it is achieving its objectives of minimizing the environmental, economic, and public safety impacts of marine pollution incidents.

In the United States Senate, Canadian Coast Guard response for an oil spill in the Strait of Juan de Fuaca was described as “call the Americans”

For some search and rescue missions the federal government has indicated that it will rely more on the all-volunteer Royal Canadian Marine Search and Rescue service (formerly the Coast Guard Auxiliary) which is already stretched thin in some areas of the Pacific Coast, rather than the full time professionals from the Coast Guard service itself.

On the industry response, BC says

The federal government should review its rules and requirements to ensure industry-funded response funds are sustainable and adequate to fully cover a major response without requiring public money. Currently, the total amount of ship owner insurance and industry funding available for spill response is $1.3 billion. By comparison, the U.S. federal government maintains a spill fund that is forecast to grow to nearly $4 billion by 2016.

Again given the government backs and the Conservative government’s close ties with the energy industry, one has to wonder what if those provisions can be enforced, especially since more and more of the energy industry in Canada is owned off shore, increasingly in China with its sorry environmental record. (Globe and Mail CNOOC’s Nexen bid: A new test for Harper)

If there are to be “world-leading” standards for environmental protection in this country, it has to be paid for. So the question remains, who will pay for it? The federal government is cutting back, Alberta doesn’t want to raise the relatively small royalties it charges the energy industry and Canada is not likely to get a contribution from China.

Who pays to protect the coast and the northern interior going to be a big question for Stephen Harper in the coming months. With the polls showing Adrian Dix and the NDP leading in contention for a provincial election next year, and now with Christy Clark, apparently, demanding higher standards, will Harper open the Ottawa wallet now, will he wait until he faces a much tougher BC premier in Adrian Dix next year, or will he stubbornly hold his course of forcing Canada into his vision of a conservative, limited government nation, with, in the case of an oil spill on land or sea, that will cost the federal treasury billions, even if the energy industry picks up some of the tab?

Auditor General 2010 Report (pdf)

Auditor General 2007 report (pdf)

BC’s background information on conditions for pipeline projects

Here is the background information on the BC provincial government’s policy on pipeline projects, as released July 23, by the government:

BACKGROUNDER 1

World-leading marine spill preparedness and response systems for British Columbia

Protecting the province’s environment is a priority for its citizens and the B.C. government. While B.C. is not the government lead in terms of responding to a marine spill, advocating for world-class protection measures and procedures is a B.C. priority. Guided by an analysis of international marine response plans and procedures, the B.C. government is moving forward with 11 recommendations to the federal government aimed at improving Ottawa’s marine spill management. Chief among those recommendations are:

Encourage the federal government to strengthen requirements for certified marine spill response organizations.

Current response times and planning capacity are less stringent than other jurisdictions like Alaska and Norway. For example, for the types of tankers being proposed for Canada’s west coast, Alaska requires planning for 300,000 barrels. In Canada, response organizations are only required to maintain response plans for spills up to approximately 70,000 barrels (10,000 tonnes).

Further, Alaska allows responders 72 hours to reach the spill site, while Canada allows 72 hours plus travel time, which can sometimes add days to the response.

Encourage the federal government to enhance tanker requirements and available response capacity.

In shared bodies of water, the United States’ requirements exceed Canada’s. For example, the United States requires escort tugs for laden tankers and mandates industry pay for designated and strategically placed emergency response tugs. Canada does not have any similar requirements.

Ensure the Canadian Coast Guard adopts a unified command/incident command structure.

The Canadian Coast Guard has a unique response system which is only used in B.C. The United States, companies and governments worldwide use a unified command/incident command response structure for a range of emergency responses, including marine spills. By bringing the Coast Guard under this system, an effective, co-ordinated response is better ensured while reducing layers of approvals that can delay critical, prompt decision-making.

Current limits of liability rules strengthened to reduce government and public exposure to financial risk.

The federal government should review its rules and requirements to ensure industry-funded response funds are sustainable and adequate to fully cover a major response without requiring public money. Currently, the total amount of ship owner insurance and industry funding available for spill response is $1.3 billion. By comparison, the U.S. federal government maintains a spill fund that is forecast to grow to nearly $4 billion by 2016.

BACKGROUNDER 2

World-Leading on-land spill preparedness and response system for British Columbia

Land-based spill response is an area where the province has significant management responsibilities. The safe transportation and use of hazardous materials – including oil and natural gas – is critical to British Columbia’s economy and way of life. While land-based spills can be mitigated, they cannot be completely avoided; they are a consequence of a modern economy.

Major resource developments in the province’s northeast, coupled with proposals to open new, and expand existing, transportation corridors for petrochemicals, makes it timely for the province to consider its spill management capacity.

B.C. government’s proposed policy:

A provincial policy review has confirmed support for the “polluter pays” principle. In other words, those sectors (i.e. the oil and gas industry) that pose the risk must be responsible for all related mitigation and response costs.

Ministry of Environment staff are in the process of reviewing options to implement industry-funded and enhanced spill-management for land-based operations. It has three central elements:

An industry-funded terrestrial spill response organization.
An enhanced provincial Environment Emergency Program.
Natural resources damages assessment.
These changes would address some key issues facing B.C.’s land-based spill response practice, including new requirements for:

industry to have tested and government-approved geographic response plans; and
provincial response capacity that matches the known risk, including staff and resources to address spills.
The proposed policy would strengthen the province’s oversight role and facilitate the verification of industry capacity. Further, it would ensure that a stable source of funding is available to ensure the program continues to have a strong presence on-scene when a spill occurs. This role for government is critical to protecting the provincial economic, social and environmental interests that can be impacted when a spill takes place.

Next steps:

Immediately strike a terrestrial spill response working group.
Engagement with key industry associations and federal agencies.
Complete in-depth technical analysis of policy and options.
Public consultation on policy intentions paper.
Draft legislation based on the chosen policy direction.
Media Contact:

BACKGROUNDER 3

Consultation and partnerships with First Nations

In British Columbia, case law requires the B.C. government to consult with First Nations on any decision that may infringe on their treaty or Aboriginal rights. Where government makes a decision that will infringe on rights, there is a legal duty called “accommodation,” which can include mitigation measures, or even economic compensation. These legal requirements impact resource development and government decision-making.

Consultation is not only a legal obligation, it is part of good governance, and the B.C. government takes consultation and the courts’ direction on consultation very seriously.

B.C.’s approach is to work in partnership to give First Nations a meaningful role in land and resource management. B.C. is also the first province to share resource development revenue with First Nations, creating opportunities that flow benefits directly back into Aboriginal communities. B.C. has reached a suite of strategic agreements that create certainty for First Nations and industry by making it easier for business and First Nations to work together.

B.C. has achieved nine Reconciliation and Strategic Engagement Agreements with First Nations. These agreements provide First Nations with a defined role in the management of lands and resources and often include tools to allow for increased First Nation participation in local economies.
B.C. has 189 active forestry revenue-sharing agreements with First Nations. Since 2003, B.C. has provided approximately $323 million and access to 63.9 million cubic metres of timber to First Nations.
B.C. signed mine revenue-sharing agreements with Nak’azdli First Nation and McLeod Lake Indian Band for the Mount Milligan Mine and the Tk’emlúps and Skeetchestn Indian bands for the New Afton Mine. Further agreements are being negotiated.
Economic Benefit Agreements with five Treaty 8 First Nations have provided $52 million to date in First Nation benefits from gas and other development in northeast B.C.
The First Nations Clean Energy Business Fund provides capacity, equity and revenue-sharing funding for First Nation participation in this sector. Since 2010, the fund has provided nearly $2.5 million to 53 First Nations.
The B.C. government has collaborated with the Business Council of British Columbia to develop the best practices to increase general understanding of industry’s role. Increasingly, companies recognize that building relationships with First Nations makes good business sense, and are taking steps to form effective relationships that result in mutual benefits.

B.C. expects proponents to build strong, enduring relationships with First Nations potentially affected by development projects. Through those relationships, there should be discussion of possible impacts on Aboriginal interests, measures in place that would mitigate those impacts and a development of impact management and benefit agreements.

BACKGROUNDER 4

Fiscal benefits imbalance: Northern Gateway Pipeline

The Northern Gateway Pipeline is forecast to provide significant benefits to governments, communities and individuals through taxation and royalty revenues, employment and indirect and induced jobs.

According to a research report by Wright Mansell Research Ltd., the pipeline is likely to generate an incremental $81 billion in provincial and federal government taxation over a 30 year period between 2016 and 2046. Of the $81 billion, a full $36 billion is accrued by the federal government.

The remaining $45 billion in provincial revenues are split with $32 billion to Alberta, $6.7 billion to British Columbia and the remaining $6 billion split among the remaining provinces, with Saskatchewan appearing to benefit by nearly $4 billion. Thus, of the $81 billion in incremental taxation revenue, British Columbia stands to receive approximately only 8.2 per cent.

The $36 billion to the federal government is anticipated to be distributed across the country on a per capita basis as these revenues would be considered to be general and not dedicated revenues. There is no guarantee these revenues would be distributed in this manner.

In addition, with the creation of a new market for Alberta oil in Asia, prices are forecast to rise such that over the same 2016-46 period, there would be a price lift of $107 billion, split $103 billion to Alberta and $4 billion to Saskatchewan, which has begun to exploit its heavy oil and bitumen resources. This lift arises from an all increased value of all oil products that are being exported out of Canada with the elimination of the discount paid for Canadian oil.

Given the risk to British Columbia from land-based and coastal bitumen spills, British Columbia does not believe an equitable distribution exists for fiscal benefits. This imbalance must be addressed prior to British Columbia considering provincial support.

BC issues list of conditions for Enbridge Northern Gateway, action plan for pipeline projects

Update 3 Joe Oliver statement
Update 2 Statement from Alison Redford
Update 1 Enbridge statement

The government of British Columbia has outlined five what it calls “minimum requirements that must be met for the province to consider the construction and operation of heavy oil pipelines within its borders.”

But at a news conference announcing the conditions, Environment Minister Terry Lake says the province will still not take an official position on the pipeline project itself.

In news release, Premier Christy Clark said, “Our government is committed to economic development that is balanced with environmental protection. In light of the ongoing environmental review by the Joint Review Panel on the Enbridge pipeline project proposal, our government has identified and developed minimum requirements that must be met before we will consider support for any heavy oil pipeline projects in our province. We need to combine environmental safety with our fair share of fiscal and economic benefits.”

Later Monday afternoon, Enbridge released a statement saying:

We wish to reiterate our commitment to working with governments, including BC, in determining what we can do to further address concerns and to engaging in a dialogue to ensure full understanding of the assessments of risk, the many safety and environmental protection measures in the plan as well as the benefits that would come with the project.

The premier of Alberta, Alison Redford, Monday evening released a stinging news release on the conditions outlined by British Columbia for pipelines crossing the province and tanker traffic on the coast.

A key phrase in the release says:

Leadership is not about dividing Canadians and pitting one province against another—leadership is about working together.

Details of the BC provincial approach are outlined in a “heavy oil policy paper.”

The government also released background information on the conditions.

The five conditions are

Successful completion of the environmental review process. In the case of Enbridge, that would mean a recommendation by the National Energy Board Joint Review Panel that the project proceed
World-leading marine oil spill response, prevention and recovery systems for B.C.’s coastline and ocean to manage and mitigate the risks and costs of heavy oil pipelines and shipments
World-leading practices for land oil spill prevention, response and recovery systems to manage and mitigate the risks and costs of heavy oil pipelines
Legal requirements regarding Aboriginal and treaty rights are addressed, and First Nations are provided with the opportunities, information and resources necessary to participate in and benefit from a heavy-oil project
British Columbia receives a fair share of the fiscal and economic benefits of a proposed heavy oil project that reflects the level, degree and nature of the risk borne by the province, the environment and taxpayers.

The release says that “any project proposal must be approved through appropriate environmental assessment (EA) processes.”

BC government graphic on environmental risk — Pie chart of the “environmental risk” from pipeline projects as released by the government of British Columbia

However, trust for the environmental processes has been falling since Stephen Harper’s government passed Bill C-38 which is designed to fast track approvals and is seen by may in the environmental movement as gutting the review process.

Action plan

The province is also proposing a joint plan of action with the federal government that would include the following elements:

Limits to liability that ensure sufficient financial resources to properly address any spills;
increased federal response capacity;
Full adoption of the Unified Command model;
Strengthened federal requirements on industry for the provision and placement of marine response equipment and infrastructure;
Industry-funded terrestrial (land-based) spill co-operative with sufficient human and technical capacity to manage spill risk from pipelines and other land-based sources;
Increased capacity within the provincial emergency response program to ensure adequate oversight of industry;
A Natural Resources Damage Assessment process to provide certainty that a responsible party will address all costs associated with a spill.

In the release, BC Environment Minister Terry Lake said: “When we consider the prospect of a heavy oil pipeline, and of the increased oil tanker traffic that would result, it is clear that our spill prevention and response plans will require significant improvements. Our government has already initiated discussions with the federal government on improving our response plans and resources,” said Environment Minister Terry Lake. “This represents an opportunity for British Columbia and Canada to develop world-leading environmental protection regimes.”

First Nations

The government release says

The fourth requirement for the B.C. government to consider support for heavy oil pipeline proposals is First Nations participation. Governments in Canada have a duty to consult and accommodate First Nations, and British Columbia is committed to meeting this test. British Columbia has developed a set of tools to help First Nations to partner with industry and participate in economic development. These agreements help to create certainty for development that benefits all British Columbians. British Columbia remains committed to this approach.

“We believe the benefits to First Nations from major pipeline proposals must be clearly identified, along with the measures that will help protect against environmental impacts,” said Aboriginal Relations and Reconciliation Minister Mary Polak. “As recently as last week, such an approach was endorsed by the Canadian Council of CEOs in their report on Aboriginal participation.”

Show me the money

The government is also emphasizing that the province benefit from any heavy oil project:

Lastly, British Columbia must receive a fair share of the fiscal and economic benefits of any proposed heavy oil project. B.C. will shoulder 100 per cent of the risk in the marine environment and a significant proportion of the risk on the land should a spill event ever occur. Current heavy oil project proposals do not balance the risks and benefits for British Columbia.

“We have identified aggressive environmental requirements and principles for First Nations engagement, and we have clearly stated we expect a fair share of the fiscal and economic benefits for our province,” said Premier Clark. “British Columbians are fair and reasonable. We know we need resource and economic development, but we also expect that risks are managed, environmental protection is uncompromised and that generations will benefit from the decisions we make today.”

BC government graphic on economic benefits — A pie chart, released by the BC government, showing the economic benefits of pipeline projects

In its release, Enbridge repeated its earlier statements that the company will continue
to reach out and encourage conversation with British Columbians about the project through our website and blogs, community meetings and conversations. We have devoted much effort and resources into consultations with communities, First Nations, and Métis…”

The company went on to say:

Enbridge and the Northern Gateway project team have worked hard to ensure this unique project would be built and operated to the highest standards and has committed to further enhancements to make what is already a safe project even safer.

This project will bring real and tangible benefits to the communities and Aboriginal groups along the proposed route, and to the province of British Columbia as a whole.

Coastal First Nations files motion with JRP to compel province of British Columbia to participate in Gateway hearings

Coastal First Nations have filed a notice of motion with the Northern Gateway Joint Review Panel, which, in effect, would compel the province of British Columbia to participate in the proceedings considering the future of the controversial Enbridge Northern Gateway pipeline project.

So far the province, from Premier Christy Clark and Environment Minister Terry Lake down to the lawyer representing the province at the JRP, Christopher Jones, have refused to take part.

In the motion, Art Sterritt, executive director of Coastal First Nations, refers to a story by Justine Hunter in The Globe and Mail, In B.C., energy policy becomes a political battleground which says:

A 30-page technical report containing the B.C. government’s assessment of the proposed Northern Gateway project sits on Environment Minister Terry Lake’s desk. Still, his government remains silent on the plan to build a pipeline across northern B.C. to get Alberta oil to Asian markets.

The motion requests an order from the JRP that would have:

a) The JRP to compel the Intervenor, the Province of British Columbia, to file
the technical report containing the B.C. government’s assessment of the
proposed Northern Gateway project reported on in The Globe and Mail
newspaper on Sunday June 3, 2012.

b) The JRP to compel the Province of British Columbia to file any other reports
or assessments it has done on the Project.

c) The JRP to allow Intervenors an opportunity to file Information Requests on
any evidence filed by the Province of British Columbia.

d) The JRP to compel the Province of British Columbia to indicate whether or
not it will issue a Certificate for the Project pursuant to the BC Environmental
Assessment Act.

e) The JRP to compel the Province of British Columbia to indicate whether it
intends to consult with First Nations on the Project, and if so, how and when?

The motion was filed June 8, but only posted recently on the JRP website. Three days later, on June 11, Jones, representing the province, filed the latest letter refusing to take part in the JRP proceedings. Since all filings are sent to intervenors and government participants, it is likely that the provincial ministry of Justice in Victoria was aware of the motion from Coastal First Nations. The province is yet to file a response to the motion.

Earlier, on May 28, the province filed a notice with the Joint Review Panel, refusing to answer questions from the Kitimat environmental group, Douglas Channel Watch.

If the Joint Review Panel does compel British Columbia to release documents and therefore participate in the hearings, it would make the Northern Gateway issue even more front and centre in provincial politics, something Premier Christy Clark, who is in trouble in the polls, has been trying to avoid.

Coastal First Nations filed this statement of facts with its motion:

Statement of Facts

1.
The Province of British Columbia is an Intervenor in the JRP process but has not filed
any evidence with the JRP.
2.
The Province of British Columbia has prepared a technical report containing the B.C.
government’s assessment of the proposed Northern Gateway Project (reported on in
the Globe and Mail newspaper on Sunday June 3, 2012).1
3.
The proposed Project [both the plant at Kitimat (energy storage facility) and the
pipeline (transmission pipeline)] is a reviewable project under the B.C.
Environmental Assessment Act, Reviewable Projects Regulation, [includes
amendments up to B.C. Reg. 4/2010, January 14, 2010].

4.
The Project has the potential to significantly affect in an adverse manner the interests of CFN and its members’ Aboriginal Rights and Title.
Grounds for the Motion

5.
The Province of British Columbia has economic and environmental interests that are
potentially affected by the Project.
6.
The Province of British Columbia will be required to issue a variety of approvals for
the Project including Crown tenures and leases.
7.
The Province of British Columbia has legal obligations to consult First Nations about
the proposed project.
8.
The Province of British Columbia plays a significant role in oil spill responses and is
a member of the Pacific States – BC Oil Spill Task Force established to develop
coordinated programs for oil pollution prevention, abatement, and response.
Decision or Order Sought

9.
CFN respectfully requests the following relief:
a)
The JRP to compel the Intervenor, the Province of British Columbia, to file the
technical report containing the B.C. government’s assessment of the proposed
Northern Gateway project (reported on in the Globe and Mail newspaper on
Sunday June 3, 2012).

1 http://www.theglobeandmail.com/news/british-columbia/in-bc-energy-policy-becomes-a-politicalbattleground/
article4227695/

b)
The JRP to compel the Province of British Columbia to file any other reports or
assessments it has done on the Project.

c) The JRP to allow Intervenors an opportunity to file Information Requests on any
evidence filed by the Province of British Columbia.

d)
The JRP to compel the British Columbia to indicate whether or not it will issue a
Certificate for the Project.

e)
The JRP to compel the Province of British Columbia, to indicate whether it
intends to consult with First Nations on the Project, and if so, when?

Coastal First Nations Great Bear Initiative FN_Motion_4_-_A2T9V4 (pdf)

Province of BC won’t provide witnesses for Gateway Joint Review hearings

The province of British Columbia has told the Northern Gateway Joint Review that it will not provide witnesses for cross-examination during the questioning phase of the hearings.

That announcement came today, June 12, 2012, in a letter from Christopher Jones, lawyer for the province, saying that since the province “did not adduce evidence in this proceeding, it would not be presenting witnesses for cross-examination.”

The letter also suggests that those who have questions on the provincial role in the Enbridge Northern Gateway “to contact counsel for the JRP and Northern Gateway for clarification.”

The letter means that the province still has no input into the process concerning one of the largest industrial projects in BC history.

On May 10, 2012, in an story by Canadian Press reporter Dirk Meissner BC environment minister Terry Lake said the province would stay out:

B.C.’s environment minister acknowledges he’s feeling the pressure to take a stand on the proposed Northern Gateway pipeline project, but he says his government is determined to keep quiet until federal environmental reviews are completed.

Environment Minister Terry Lake said Thursday the province’s silence on the pipeline decision created a demand for clarity that the government was willing to withstand.

But he added: “We feel the pressure, of course we do, but it’s not responsible to take a position before all that evidence is before us and then we can make the best decision in the interests of all British Columbians.”

On Monday, Global TV’s Keith Baldry asked premier Christy Clark why the province is keeping out of the Joint Review Process. In her response, Clark repeated the provincial position that her government would not take a position on the pipeline and tanker project until the conclusion of the JRP. (Video of the item is not on the Global website).

In late May, the province told the Joint Review Panel it would not provide answers to questions from the Kitimat environment group Douglas Channel Watch about items that DCW felt was in provincial jurisdiction.

Province of BC Response to Procedural Conference Draft Report (pdf)

Government move has “utterly destroyed” JRP, no excuse to wait for final report on Gateway, Cullen says

MP Nathan Cullen makes a point during an NDP leadership campaign stop in Kitimat, Nov. 11. 2011 (Robin Rowland/Northwest Coast Energy News)

The Northern Gateway Joint Review process has been “utterly destroyed” by the Conservative government, Skeena Bulkley Valley NDP MP Nathan Cullen told reporters Friday, April 20, adding a warning those who were waiting for the JRP to complete its hearings before making up their minds, “all those people like the premier and others who said there’s a good process in place, that excuse has been ripped away.”

Earlier that week, Natural Resources Minister Joe Oliver announced that the government that would introduce legislation to “streamline” the review process for major resource developments that would include such provisions as limiting the time and the number of participants and allowing the cabinet to overrule any decision or recommendation from the National Energy Board.

Cullen, who was just named Opposition House Leader, was holding his regular conference call with northwest BC reporters.

He called the changes proposed by the Conservative government for environmental assessment, ”brutal,” adding, “the already weakened rules have become fundamentally more weak.” He said it seems that the government is going to further weaken the role of the Department of Fisheries and Oceans in checking environmental impacts.

The bill, which has yet to be tabled in the Commons, will download federal responsibility for the environment to the provinces, which Cullen said could be subject to a constitutional challenge.

On the controversial Enbridge Northern Gateway project, which would see twin bitumen and condensate pipelines from Alberta to Kitimat, Cullen said, while the government’s Northern Gateway policy was not mentioned in the news conference or briefing documents, it was buried deep on the website and that indicated “it will not be up to the NEB anymore, they will retroactively apply these new rules it will now become a purely political decision. The prime minister, with all his wisdom, is going to make the final decision on the pipeline, totally undermining the process we are in now across the region.”

(The key bureaucratic phrase actually reads: “Establish clearer accountability for decisions on major pipeline projects in the national interest by giving government authority to make the “go/no go” decisions, based on the recommendations of the National Energy Board.” )

Cullen said he is already hearing that people in the northwest are frustrated and angry by the announcement. “They feel that they’ve been duped and the credibility of the panel has been destroyed by this government. And so all those people like the premier, who said the process was what they were waiting for, that process has now been utterly, utterly, destroyed.”

Cullen was inferring any decision to support or oppose the pipeline is now back in the courts of BC Premier Christy Clark and groups like District of Kitimat Council and Terrace Chamber of Commerce who have, up until now, remained neutral, waiting for the final report from the Joint Review Panel.

The Terrace Chamber of Commerce, for example, said:

We want the objective panel of experts to assess the concerns of affected parties and contrast them with procedures and equipment being positioned to mitigate any and all perceived risks. It is important that all voices are heard and all questions are asked and answered.

“The process was always threatened, a lot of people suspected that Stephen Harper would not accept a ‘no’ when it comes to this pipeline and now that’s been made explicit. And all those people like the premier and others who said there’s a good process in place that excuse has been ripped away,” Cullen said.

Cullen said he believes that people should still participate in the hearings but the panel now has to justify its existence.

“At the same time.“ Cullen said, “the government has shut down the oil response group in Vancouver and moved it 5,000 kilometres to Quebec, they’ve cut funding on our ability to protect the coast, even after the auditor general has pointed out that the current ability to protect our waters is lacking, so it looks that they are going to do everything and anything to approve this pipeline and put at risk so much of what we care about. It’s a shame but I don’t think it will lessen the resolve of people.”

Cullen called Joe Oliver’s statement that there would be more money for enforcement of environmental regulations a “shell game.”

“They cut they cut $80 million and put back $13 million and tried to pretend that’s an increase.
There is less protection for our ocean environment. At the same time, they’re pushing two major pipelines to the west coast and increasing the risk dramatically. Shutting down the operations in Vancouver, while trying to put a pipeline right into Vancouver, smacks of some sort of hypocrisy or arrogance. I mean they’re claiming budget cuts, but the prime minister is spending more on is own office, and they’re not making a single dollar cut to the F-35, which are in the billions. It’s peanuts they’re pretending to save here and it’s putting very important things at risk in our oceans.”

He expects the bill changing the rules for resource development to be introduced next week. But, Cullen added, that it is clear that government has been planning this for sometime, a fact that further undermines the credibility of the Northern Gateway Joint Review Panel. “What the government has just said is, ‘We simply don’t care. We’ve already made up our minds before hearing any testimony.’ I think they’ve made up their minds in advance of this but now it’s obvious that it was always true. You don’t put legislation like this together in a week. The bill that they are going to introduce and the press conference they had last weekend were months in the making. I know how Ottawa works. This has been around for a long time and they knew this for a long time. It’s entirely cynical.”

He expects the government will try and ram the legislation through the House and one of his jobs as NDP and Opposition House leader will be to slow it down.

“I think the very cynical anti-democratic move by the government is only going to increase the number of Canadians that will be opposed to this. So getting the message out specifically, getting people rallied around this cause and letting the government know they’re not going to steamroll us…. Continuing to try to bully us into submission is about the dumbest tactic imaginable, but I guess that’s the only one available to them. If the only tool you have the toolbox is a hammer, I guess every problem is a nail.

“Fundamentally this is a question of trust, do we trust that this government will protect the environment when it comes to oil and gas projects? And I can’t imagine an oil pipeline that Steven Harper doesn’t love. Maybe if the project went right through his living room, he may have some questions about it, but outside of that, there isn’t been a single thing that the oil industry has wanted from this government that they haven’t got, not one thing. So do you trust them to protect fisheries, do you expect them to protect us from oil spills? The answer has got to be no.”

Rio Tinto Alcan to make announcement Thursday about Kitimat growth plans

Rio Tinto Alcan has called a news conference for Thursday, December 1 in Kitimat “to make an announcement regarding
the company’s multi-billion dollar growth plans.”

BC Premier Christy Clark, Rio Tinto CEO Jacynthe Cote, Jean Simon, president, RTA Primary Metal North America, Paul Henning, RTA vice president, British Columbia Operations & Strategic Projects, Western Canada and key regional stakeholders and First Nations representatives will be at the announcement at the Kitimat Modernization site during the noon hour.

The RTA news release says the announcement will be a significant event for Kitimat, the northwest region of the province, and all of British Columbia. It is likely, especially with the BC premier in attendance, the RTA is giving the go ahead for the long planned $2.5 billion smelter modernization project.

Updates

Sources have told Northwest Coast Energy News that applicants for jobs at the Kitimat Modernization Project, where the prime contractor is Bechtel, were told during the past month to wait until the end of November and that time, the applicants were told, there would probably be between 500 and 550 jobs available.

The Globe and Mail reports:

Rio Tinto to go ahead with Kitimat smelter expansion

Rio Tinto Alcan is pushing ahead with construction of a $3.3-billion (U.S.) smelter in Kitimat, B.C., even as stagnant prices have spurred a selloff of other aluminum assets.

London-based Rio Tinto PLC, which acquired Montreal-based aluminum giant Alcan for $38.1-billion in 2007, is expected to announce Thursday it has final approval to modernize the 57-year-old smelter to double its capacity

Approval will see Rio spend another $2.7-billion on Kitimat, after already setting aside $650-million towards the upgrade, raising the construction price tag more than 30 per cent from $2.5-billion. The plan includes demolishing a building and clearing space for a new plant.