Two Down and Two to Go: Half of Canada’s Tar Sands Pipeline Proposals Stymied

The prospects for new Canadian fossil fuel pipelines are looking increasingly bleak. The election of the federal Liberals under Justin Trudeau marked a new day, and a new more rigorous and open approval process for Canadian pipelines. This is in stark contrast to the approach of former Prime Minister Stephen Harper. His dream of ferrying tar sands oil through pipelines may be dying along with his political career.

The fossil fuel industry is in a death spiral which has only been hastened by the Paris Climate Agreement. In Quebec the Energy East pipeline has been slowed by protests and concerns about the impacts on Beluga whales. However, the NEB has recently approved the TransMountain pipeline extension.

First the administration of US President Barack Obama refused to issue a permit for the Keystone XL pipeline in 2012. Then he canceled it outright in November 2015. The Keystone would have transported bitumen from Alberta to the Gulf of Mexico.

Now in a landmark ruling a Canadian appeals court has overturned federal approval for Enbridge’s $7.9 billion Northern Gateway pipeline that would have transported crude oil from Alberta to British Columbia.

The pipeline was approved by the National Energy Board (NEB) in 2014 despite widespread opposition. However one of the 209 caveats was that the government must consult with Canada’s first nations people “on any project-related concerns that were outside of the Joint Review Panel’s mandate.”

The failure to consult was the reason provided for the court’s decision. In a statement the court said:

“We find that Canada offered only a brief, hurried and inadequate opportunity … to exchange and discuss information and to dialogue,” the ruling says.

It went on to say that the government “entirely ignored” the fact that the pipeline affects the “subsistence and well being” of first nations people.

Northern Gateway is now probably off the table for the foreseeable future, since Canada’s Prime Minister Justin Trudeau spoke out against the pipeline during his campaign. Enbridge has 60 days to appeal. The final approval rests with the federal government.

While not expressing outright opposition, Trudeau cautiously reflected on Canada’s fossil fuel pipelines during his campaign. He specifically singled out the Northern Gateway.

We should not expect that Canada’s fossil fuel industry will accept the ruling. However, it does seem very unlikely that the Northern Gateway pipeline will get built anytime soon.

“At every turn you’re going, you are seeing nails in the coffin of the Enbridge project,” said Peter Lantin, president of the council of the Haida Nation, one of the parties that appealed. “I don’t think there’s enough room for another nail in the coffin. Between on-the-ground opposition and the federal government’s promises to keep B.C.’s North Coast tanker free and demonstrate climate leadership, this pipeline is never getting built.”

The death of the Keystone XL and the highly questionable future of the Northern Gateway does bode well for those who would like to bring an end to carbon intensive tar sands oil exploitation. 

As oil and gas analyst and expert Abhishek Deshpande told CNBC, “It definitely puts Canadian oil sands projects at risk.”

The cancellation of the Keystone XL has had upstream impacts that
have effectively reduced the amount of fossil fuel exploitation in
Canada. As explained by Inside Climate News:

“Six months after the Obama administration rejected the Keystone XL
pipeline, at least 24 other proposed energy projects—mines, pipelines,
plants, related rail projects and export terminals—have been canceled,
rejected or delayed.”

The article goes on to say

“Since
then, the Federal Energy Regulatory Commission rejected two project
applications—for the Oregon-based Jordan Cove LNG project and Pacific
Connector Pipeline—and delayed the decisions on two other facilities.
For six of the projects, the bids or key permits were rejected by either
a federal panel or state or local officials. Companies chose to cancel
seven other projects, including Arch Coal’s abandoning its planned Otter
Creek coal mine in Montana. The remaining facilities are delayed.”

Now the battle lines will shift to Kinder Morgan’s TransMountain pipeline extension through British Columbia and TransCanada’s Energy East pipeline through New Brunswick.

Two down and two to go.