By Colleen Collins and Ron Wallace
Published in Calgary Herald, The Province and the Edmonton Journal
July 13, 2019
In response to federal Natural Resources Minister Amarjeet Sohi: “New pipeline law will get projects built through public trust,” (Herald Opinion, June 27):
Hon. Minister Sohi asserts that passage of Bill C-69 constitutes “better rules that protect the environment, provide certainty for industry, restore public trust and meaningfully include Indigenous peoples in the process.” We beg to differ.
It is essential that Canadians have facts that enhance public discourse, not political rhetoric.
Regrettably, the passage of Bill C-69 effectively ignored advice from industry, independent experts, foundations and senior financial experts who have decried the accelerating regulatory damage to Canada’s economy. In particular, cabinet dismissed so-called “industry amendments” out of hand. However, if the industry can’t survive under the conditions created under Bill C-69, isn’t that a problem not just for industry but the economy and indeed the country?
The debate surrounding Bill C-69 took place while Canada’s single largest economic sector experienced dramatic international competitive pressures aggravated by Canada’s demonstrated inability to build approved energy projects. While the United States has increasingly captured our domestic markets, it can purchase Canadian oil and gas at huge discounts. Not surprisingly, Canadian energy investment has collapsed, as demonstrated by findings from the C.D. Howe Institute whereby planned Canadian energy sector investment had dropped by $100 billion between 2017 and 2018.
Additionally, far from increasing regulatory certainty for industry, Bill C-69 does not “modernize” the NEB, it will completely dismantle it. The Canadian energy regulatory system will now be saddled with unintended consequences that the Canada West Foundation described as “disastrous — and irreversible” because the judicial certainty of past court rulings will be lost while opportunities for entirely new future legal challenges will emerge requiring new interpretations by the courts.
The current legislation flies in the face of public trust. Replacing an independent expert, quasi-judicial decision-making body like the National Energy Board with an agency that is essentially an arm of government will degrade regulatory processes and render them increasingly politicized. While some may have been pleased with this government’s unilateral cancellation of Northern Gateway, the decision sent shock waves through the domestic and international investment communities. It demonstrated that Canada could not be trusted to adhere to its own regulatory decisions from one government to the next. Then, when faced with a similar court decision on Trans Mountain, Canada made a different decision and was forced to nationalize the pipeline after the proponent abandoned the project in the face of political and regulatory uncertainties.
Fortunately, the treaty rights of Indigenous people are protected by Section 35 of the Canadian Constitution. However, as demonstrated by two court decisions, resource development applications have been plagued by failures of the federal government’s own consultation process. Now the federal government has chosen to deliberately ignore the economic aspirations and interests of certain Indigenous Peoples. In addition to Bill C-69, with Bill C-48 (the northwest coast tanker ban) another Indigenous economic opportunity, the First Nations Eagle Spirit Energy Corridor, has been foreclosed. Indigenous leader and president Calvin Helin described the passage of the legislation as one in which “common sense did not prevail.”
Earlier, in 2016, the Trudeau government announced a major decision, in concert with the outgoing Obama administration, to jointly “launch actions ensuring a strong, sustainable and viable Arctic economy and ecosystem, with low-impact shipping, science-based management of marine resources, and free from the future risks of offshore oil and gas activity.” While some environmental organizations praised the announcement, less laudatory was Northwest Territories Premier Bob McLeod. Aghast at the lack of governmental consultation that preceded the announcement, he voiced concerns about a unilateral federal decision that summarily negated important benefits of the NWT’s 2014 Devolution Agreement that assured co-management and resource sharing in the Beaufort Sea offshore.
This appalling record demonstrates why Indigenous peoples have little reason to trust this government, reasons compounded by even greater regulatory uncertainty introduced for proponents into a complex and sensitive consultative process.
It is a supreme irony that the principle benefit resulting from the federal government’s acquisition of the Trans Mountain pipeline expansion may be that cabinet will now be forced to experience first-hand the regulatory, public, legal and procedural tripwires that have effectively foreclosed so much of Canadian energy export development.
Colleen Collins is vice-president of the Canada West Foundation, Calgary. Ron Wallace is a retired permanent member of the National Energy Board and an executive fellow of the Canadian Global Affairs Institute, Calgary.