Trans Mountain? Then revive Energy East pipeline: Raitt
Morneau warns the Kinder Morgan deal does not set a new precedent for other projects.
Oil & Gas
OTTAWA — If Prime Minister Justin Trudeau is willing to go to the wall to save the Trans Mountain pipeline and get oil to Canada’s west coast, federal Conservatives say he should be equally willing to do the same to revive a pipeline that would have brought oil to Canada’s east coast.
And at least one Liberal backbencher is echoing that sentiment.
A day after Finance Minister Bill Morneau announced the federal government has made a $4.5-billion offer to buy Trans Mountain from Kinder Morgan and will build the expansion to the pipeline itself in order to overcome political opposition in B.C., Conservative Deputy Leader Lisa Raitt questioned Wednesday why Trudeau wasn’t putting up the same fight to save Energy East.
“Will the Prime Minister promise to enter into negotiations to provide the same level of certainty for Energy East?” she asked.
Energy East, which would have converted a natural gas pipeline to oil and extended it all the way to New Brunswick, was cancelled last fall when TransCanada decided conditions had changed, including new federal regulations and lower oil prices.
The Conservatives were not alone in their thinking. Saint John, NB, Mayor Don Darling also took to Twitter to wonder “where was this support for Energy East.”
For his part, Trudeau rejected the idea, accusing the Conservatives of raising “old news” because they were embarrassed that they couldn’t get pipelines built when they were in government. However the questions raise a possible vulnerability for the Liberals in Atlantic Canada, a region where the party won all 32 seats in the last election.
New Brunswick Liberal MP Wayne Long said that while he’s thrilled with the Trans Mountain decision, he’d like Trudeau to take another look at Energy East.
“I’m simply asking my government to take a look at TransCanada, Energy East, and see if maybe the parties of TransCanada, our government could get together and find a way to revisit, reboot, restart a process that could lead to Energy East coming to Saint John, New Brunswick, my riding,” he said.
In a speech to the Calgary Chamber of Commerce on May 31, Morneau warned that the Kinder Morgan deal does not set a new precedent for other projects.
“What I would say is that this decision today was exceptional. We are in a situation where we’re putting forth a decision to make something happen in an exceptional way for a project that, let’s acknowledge, is pretty unique.”
Conservative Leader Andrew Scheer vowed to make reviving Energy East a campaign issue and said he wouldn’t put $4.5 billion on the table to get it done.
“I believe the Liberals would like people to believe (buying) was the only way to get the pipeline built but I think more and more Canadians are realizing that the fact that it’s being nationalized is a result of other things that could have been avoided if this government had made different decisions,” Scheer said.
If the government had reinforced federal authority for pipelines through the courts and in legislation as soon as BC NDP Leader John Horgan became premier last year, Scheer said that would have prevented Horgan from introducing the uncertainty that ultimately led to Kinder Morgan’s nervousness that the project would never come to fruition. Instead, he said Trudeau did nothing to fast-track any constitutional references and never introduced legislation to “entrench and enshrine federal jurisdiction.”
Horgan’s court reference – to see if BC has the constitutional authority to pass a regulation to limit flows of diluted bitumen in the new pipeline pending additional scientific research on how to clean it up a potential spill – spooked Kinder Morgan investors. The Constitution gives Ottawa jurisdiction over pipelines and many legal experts believe Horgan’s regulation won’t pass judicial scrutiny, but the company nevertheless halted non-essential spending on the project in early April and demanded Ottawa prove there was certainty to move forward by the end of this month.
Morneau said this week the only way to provide 100 per cent certainty was for Ottawa to buy the pipeline, build the expansion itself and then sell the whole thing back to the private sector when it made financial sense later. He said federal ownership will shield the project from BC political hijinks.
However Toronto energy lawyer Ian Blue said ownership doesn’t change the fact that the Constitution clearly gives authority for pipelines to Ottawa and the Supreme Court has upheld the law to prevent provinces from doing anything that would “neutralize its essential function.”
In other words, Horgan’s regulation would be unconstitutional no matter who owns the pipeline, said Blue.
The biggest question now, he said, is what Trudeau will do about the expected crush of protests. Thus far the government has only said it will respect the democratic right to protest.
More than 200 protesters _ including NDP MP Kennedy Stewart and Green Party Leader Elizabeth May _ have already been arrested for violating a court-ordered injunction to stay a certain distance away from Kinder Morgan’s marine terminal in Burnaby, B.C. Many more protests are expected as anger at the government’s pipeline purchase exploded this week.
NDP Leader Jagmeet Singh said he has not instructed any other MPs in his caucus about how to participate in protests and said he understands the frustration and anger of people who felt the Trudeau government promised to protect the environment, not build more pipelines.
“I’m absolutely not condemning it,” he said. “I’m saying I understand that people use non-violent civil disobedience. People use protests as a way to express their frustration and I understand that.”
— With files from Lauren Krugel in Calgary