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Challenge to energy project’s approval brings threats to Smithers activist.

Smithers resident Michael Sawyer claims the Coastal GasLink project lacks the required federal approvals and wants the National Energy Board to review it. Photo by Dan Mesec.

The $6.2-billion Coastal GasLink pipeline may face a bigger threat than the opposition of Wet’suwet’en hereditary chiefs and protests across Canada.

Smithers resident Michael Sawyer says the project lacks the required federal approvals. He has filed a formal application to require a full National Energy Board (NEB) review.

Last fall the board agreed to consider Sawyer’s challenge.

In April it will hear final arguments on the question of whether the pipeline falls under provincial jurisdiction, or if it is subject to NEB rules and assessments.

That would bring delays and “put real, tangible benefits to people in B.C., including First Nations, at risk,” said pipeline owner TransCanada Corp., rebranded this week as TC Energy.

The B.C. government’s Environmental Assessment Office approved the contentious 670-kilometre pipeline in 2014.

The project would move fracked methane from northeastern B.C. and northwestern Alberta to the $40-billion LNG Canada export terminal in Kitimat.

Sawyer, a 61-year-old environmental consultant, said the prospect of a NEB regulatory review should have been considered by the B.C. Supreme Court before it issued an injunction that led to RCMP action against two Indigenous checkpoints this week.

“I wonder if TransCanada disclosed information to the judge about this jurisdictional challenge before it asked him to grant the injunction against the blockade,” he said. “The fact is that the RCMP enforced the injunction in an over-the-top manner for a pipeline that may be deemed illegal and whose permits could be quashed.”

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How this man’s legal challenge could stall LNG Canada

October 3, 2018

IN-DEPTH

How this man’s legal challenge could stall LNG Canada

A massive new fracked gas export plant in Kitimat may have just received the go-ahead, but a Smithers resident is arguing a pipeline vital to the project should have faced a federal review — and he’s won before

LNG Canada has announced that the international consortium is ready to proceed with Canada’s largest ever infrastructure project, but, in a David and Goliath scenario, a challenge by a Smithers environmental consultant is aiming to temporarily derail or delay the $40-billion megaproject.

Michael Sawyer is arguing that the Coastal GasLink Project, a 675-kilometre pipeline running from Dawson Creek to Kitimat, should have faced a federal review by the National Energy Board instead of relying on provincial approval.

Although the $4.7-billion pipeline is set to be built entirely within B.C. — which would usually put it under the jurisdiction of the province — the pipeline, which would supply the LNG Canada export terminal in Kitimat, connects to an existing pipeline system that is federally regulated.

Also, Coastal GasLink Pipeline Ltd. is a wholly owned subsidiary of TransCanada Pipeline Ltd., which means under the Constitution Act the pipeline is within federal jurisdiction and should be regulated by the National Energy Board, Sawyer says in an application to the board.

Sawyer-Challenge-CoastalGasLinkProject-NEB by The Narwhal on Scribd

“A pipeline that crosses international boundaries or provincial boundaries would normally be federally regulated,” Sawyer told The Narwhal, pointing to a 1998 Supreme Court decision that said if a provincial pipeline is “functionally integrated” with an existing federally regulated line, it becomes an extension of the federal line.

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Canada’s Top Court Dismisses Burnaby Case Against Trans Mountain Pipeline

August 24, 2018

Canada’s Top Court Dismisses Burnaby Case Against Trans Mountain Pipeline

Canada’s Supreme Court on Thursday dismissed an appeal by the City of Burnaby—the planned end point of the Trans Mountain pipeline expansion in British Columbia on the Pacific coast, clearing another legal hurdle for the project, which still faces several lawsuits at various Canadian courts.

The City of Burnaby was seeking to overturn a decision by Canada’s National Energy Board (NEB), which ruled in favor of Kinder Morgan in December last year, saying the company is not required to comply with two sections of the City of Burnaby’s bylaws as it was preparing to begin construction of the Trans Mountain Expansion Project. The NEB found that Burnaby’s bylaw review process was unreasonable and caused an unreasonable delay.

The Trans Mountain expansion has become one of the most controversial pipeline projects in North America as it pitted two provinces—Alberta and British Columbia—against each other.

Alberta’s heavy oil producers need more pipeline capacity as their production grows, but pipeline capacity has stayed the same. British Columbia’s NDP government, which came into office last year, however, is against any new oil pipelines, although it doesn’t mind all the crude it currently gets from the existing pipeline.

The fierce opposition in British Columbia has forced Kinder Morgan to reconsider its commitment to expand the Trans Mountain pipeline, and to sell the project to the Canadian government.

“We’re disappointed that the courts seem unwilling to review decisions made by the National Energy Board that hamper municipal jurisdiction,” Burnaby Mayor Derek Corrigan said, commenting on today’s court ruling.

“Burnaby is not going away. We intend to continue to oppose this project with all legal means available to us, and will be continuing with our other legal challenges,” Corrigan added.

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Canada Bets On Trans Mountain Expansion To Sell Oil In Asia

June 11, 2018

Canada Bets On Trans Mountain Expansion To Sell Oil In Asia

Canada may be the fourth largest producer and third largest exporter of oil in the world, but it has one sole customer of its oil—the United States.

At the end of last month, Canada took a step toward ensuring that its oil would have an export outlet to the world’s fastest-growing energy market, Asia.

Analysts believe that the federal government stepping in to save the Trans Mountain expansion project has boosted the chances that the pipeline will be built and give Canada an export outlet from the Pacific Coast to the Asian markets. The industry is cautiously optimistic, but some companies say that Canada must do more to level the playing field for its oil.

Last year, Canada’s crude oil exports increased by 6.5 percent annually to 3.3 million bpd. Of those, exports to destinations other than the U.S. accounted for just 0.8 percent of all, according to data by the National Energy Board (NEB).

Due to congested takeaway capacity and lack of enough pipelines to either the Pacific or the Atlantic Coasts, Canada’s oil is currently priced at a huge discount to the U.S. benchmark. The discount at which Western Canadian Select (WCS)—the benchmark price of oil from Canada’s oil sands delivered at Hardisty, Alberta—trades relative to West Texas Intermediate (WTI) has been US$20, and at times US$30 a barrel this year.

Fierce opposition in British Columbia has forced Kinder Morgan to reconsider its commitment to expand the Trans Mountain pipeline that would increase the daily capacity of the pipeline to 890,000 bpd from 300,000 bpd. So the Government of Canada reached an agreement with Kinder Morgan last month to buy the Trans Mountain Expansion Project and related pipeline and terminal assets for US$3.5 billion (C$4.5 billion).

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Politics versus the future: Canada’s Orwellian energy standoff

May 8, 2018

Politics versus the future: Canada’s Orwellian energy standoff

There is no denying the utility of fossil fuels, which meet 85% of the world’s energy needs. And consumption is rising along with emissions. Even in Canada, the second largest hydropower producer in the world, 76% of end use energy is provided by fossil fuels.

We are told by the federal government that increasing oil and gas production and meeting emissions reduction targets are mutually compatible goals. Alberta has crafted a ‘climate leadership plan’ that allows oil sands emissions to grow by 40% and places no restrictions on oil and gas production outside of the oil sands. A phase out of remaining coal plants, most of which were already due to be decommissioned under the former Harper government’s legislation, and a modest carbon tax, were also included.

Even with Alberta’s oil sands cap in place, National Energy Board (NEB) projections for oil and gas production growth show that upstream emissions will increase greatly, to the point that a 49% reduction in emissions from the rest of Canada’s economy would be required to meet our Paris targets.

Notwithstanding the difficulty in making such radical reductions outside of the petroleum sector in a short timeframe, the federal and Alberta governments assert that if the Trans Mountain pipeline expansion (TMX) is not built, even Alberta’s extremely modest ‘climate leadership plan’ may be cancelled.

Rachel Notley and Justin Trudeau have invested a lot of political capital in TMX but are ignoring the bigger picture. Even if oil and gas production is allowed to grow per the NEB’s projections, there are two other export pipelines likely to be built that are not mentioned in the heated TMX debate.

Line 3 and Keystone XL, without TMX, would provide sufficient pipeline export capacity for foreseeable production growth under the oil sands emissions cap, and access world prices on the Gulf Coast.

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Canada Is Facing A Heavy Crude Crisis

March 17, 2018

Canada Is Facing A Heavy Crude Crisis

Canada’s benchmark heavy crude oil widened its discount to WTI to the largest in six trading sessions on Thursday, as additional storage capacity in Alberta and data about lower crude-by-rail shipments added concerns over the domestic oil glut, as TransCanada’s Keystone Pipeline has yet to return to normal pressure levels following a leak and temporary shutdown last November.

On Thursday, Western Canadian Select was trading at a discount of US$27 a barrel to WTI. The discount widened to the biggest level, US$30.55 a barrel, in four years on February 5, after a selloff following the temporary shutdown of Keystone in mid-November.

This week, market participants were digesting news about increased storage capacity and January crude-by-rail data. Crude-by-rail exports out of Canada fell by 11.3 percent month on month in January to 140,959 bpd, according to the latest data by Canada’s Crude Oil Logistics Committee, quoted by Platts. Analysts had expected rail crude exports to be either flat or down, because Canadian rail operators and customers had reported delays in shipments due to extreme weather.

In addition, Kinder Morgan Canada and Canadian midstream operator Keyera said earlier this week that they added two additional tanks at the Base Line Terminal for service ahead of schedule. The two tanks add an additional 800,000 barrels of crude storage to the 1.6 million barrels currently in operation.

Meanwhile, data from Canada’s National Energy Board (NEB) showed that the Keystone Pipeline, which was restarted on November 28 after a shutdown on November 16, had throughput volumes of 582,000 bpd in December, following a slump to 298,000 bpd in November.

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Five Things You Need to Know About the Cancellation of the Energy East Oilsands Pipeline

October 9, 2017

Five Things You Need to Know About the Cancellation of the Energy East Oilsands Pipeline

Announced via press release on Thursday, the news confirmed long-held suspicions that the $15.7 billion, 4,500 km oilsands pipeline simply wouldn’t cut it in today’s economic context.

But that hasn’t stopped commentators on all sides from pouncing on the cancellation as proof of their political project. Conservative politicians have lambasted the federal Liberals for introducing carbon pricing and new rules on pipeline applications, while environmentalists have claimed the company’s decision was a direct result of their organizing.

DeSmog Canada is here to help wade through the mess. Here are five things you should know about the cancelled Alberta-to-New Brunswick pipeline.

1. Energy East was primarily for export

Perhaps the most lingering myth about Energy East was that it would be built to displace foreign oil imports in Eastern Canada.

In fact, that very notion was repeated by Alberta Premier Rachel Notley in her Facebook post about the cancellation: “We believe this nation-building project would have benefited all of Canada through new jobs, investment, energy security and the ability to displace oil being imported into Canada from overseas and the United States,” she wrote.

Except it’s never been true.

An application by TransCanada to the National Energy Board back in May 2016 indicated that it would ship an estimated 281 tankers per year of oil, equivalent to about 900,000 barrels per day. That’s more than 80 per cent of the pipeline’s planned 1.1 million barrel per day capacity, leaving around 200,000 barrels per day to be refined at New Brunswick’s Irving Oil refineries.

That’s far below the 736,000 barrels per day that TransCanada suggested is being imported from foreign countries due to a lack of a west-to-east pipeline. In addition, Irving Oil’s president suggested in 2016 that his company wouldn’t necessarily displace its use of cheaper barrels from Saudi Arabia with product from Alberta.

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NEB approves Enbridge Line 3 pipeline replacement

April 25, 2016

NEB approves Enbridge Line 3 pipeline replacement

Conditions include consultation with First Nations

Enbridge is proposing to replace its Line 3 pipeline from Hardisty, Alta., to Superior, Wis. If approved, it will approximately double the amount of oil shipped daily.

Enbridge is proposing to replace its Line 3 pipeline from Hardisty, Alta., to Superior, Wis. If approved, it will approximately double the amount of oil shipped daily. (Canadian Press)

The federal government must now make a decision on the project.

Enbridge wants to spend $7.5 billion to replace its Line 3 pipeline, which stretches 1,660 kilometres from Hardisty, Alta., to Superior, Wis.

The pipeline is currently operating at about half capacity after the company voluntarily reduced pressure because of reliability concerns.

“The Enbridge Line 3 project is in the Canadian public interest and is not likely to cause significant adverse environmental effects,” said Robert Steedman, the NEB’s chief environmental officer.

As part of the NEB’s decision, Enbridge must develop a plan for Aboriginal groups to participate in monitoring construction.

Several groups oppose the pipeline project, including First Nations and environmental groups in Manitoba and Minnesota. The company has already delayed its expected completion date from 2017 to 2019 because of the regulatory process in Minnesota.

“The hearing panel believes there is an important opportunity at this juncture for Enbridge to renew, and in some cases, improve its relationship with Aboriginal groups,” said Steedman.

The project will be subject to the federal government’s new environmental assessment process, which was announced in January.

The upgrade would allow the line to pump a maximum of 760,000 barrels per day, up from the 390,000 barrels it is currently able to move.

Line 3 already has presidential approval, but the replacement project must undergo separate permitting processes in the U.S. before construction can begin.

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TransCanada announces major contract for Energy East pipeline

February 3, 2016

TransCanada announces major contract for Energy East pipeline

Project is controversial, with Montreal and nearby mayors opposed on environmental grounds

TransCanada's proposed pipeline project would carry 1.1 million barrels a day from Alberta through Quebec to an export terminal in Saint John.

TransCanada’s proposed pipeline project would carry 1.1 million barrels a day from Alberta through Quebec to an export terminal in Saint John. (Canadian Press)

The Calgary-based company planning to build the Energy East pipeline says it has signed a provisional multimillion-dollar order for the construction of 22 modular enclosures along the pipeline route.

TransCanada Corp. officials say their deal with ABB Canada would create 120 direct jobs in Quebec and a further 90 spinoff jobs outside the greater Montreal area.

But there’s a catch: the jobs would materialize only if regulators approve the controversial pipeline project.

The proposal has run into major opposition in Quebec, with the mayors of Montreal and dozens of surrounding municipalities saying the project’s environmental risks outweigh its economic benefits.

The $15.7-billion Energy East pipeline would carry a million barrels a day of western crude as far east as Saint John to serve domestic refineries and international customers.

The project would include the existing TransCanada pipeline as far east as Montreal and would require the construction of 1,600 kilometres of new pipeline, including a long section that would run through Quebec to the south coast of New Brunswick.

Construction possible by 2018

If the federal government and the National Energy Board give their OK, TransCanada has said it could begin construction by 2018. The pipeline would be ready for use by 2020.

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Pipeline Reforms ‘Great Step’ but Don’t Account for Most Emissions, Say Climate Critics

January 28, 2016

Pipeline Reforms ‘Great Step’ but Don’t Account for Most Emissions, Say Climate Critics

Does ignoring downstream impacts export Canada’s responsibilities?

Canada’s minister of the environment and climate change Catherine McKenna at the COP21 climate summit in Paris, France in December. Photo by Mychaylo Prystupa.

The Trudeau government’s newly announced reforms to pipeline environmental assessments still fail to consider the impact of almost 90 per cent of resulting greenhouse gas emissions, climate experts have told The Tyee.

The government announced a new interim assessment regime Wednesday, saying it will restore public confidence in much-criticized National Energy Board reviews.

The major change will see a pipeline’s upstream emissions included in the assessment. For a pipeline from Alberta’s oil sands, for example, the greenhouse gases produced in mining and processing the bitumen will be included in the environmental assessment review.

But critics say government will still not be considering the much greater downstream emissions as pipeline products are processed and burned in vehicles, factories and power plants.

A recent analysis by Simon Fraser University climate economist Mark Jaccard found these emissions represented up to 89 per cent of greenhouse gases from the Kinder Morgan Trans Mountain pipeline expansion.

University of British Columbia climate policy expert Kathryn Harrison says Ottawa is effectively exporting the climate change problem to other countries by ignoring downstream emissions.

IMAGE1.upstream-300.jpg

Analysis of the full greenhouse gas impact of Trans Mountain pipeline expansion pipeline shows 89 per cent is in the downstream GHG impacts overseas in refining and combusting. Source: Mark Jaccard and Associates.

Harrison said under international reporting norms the downstream greenhouse gas emissions are the responsibility of the end-user country. “But the fact is, we’re contributing to that, and we’re making money from it.”

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Kinder Morgan pipeline review by NEB loses 35 participants over ‘flawed’ process

August 13, 2015

Kinder Morgan pipeline review by NEB loses 35 participants over ‘flawed’ process

‘We can’t abide by the system any more. It’s too flawed,’ says former participant

Dozens of participants have dropped out of the controversial National Energy Board review of Kinder Morgan’s proposed Trans Mountain pipeline expansion, saying they can no longer support a “biased” and “unfair” process.

Thirty-five commenters and interveners, including the Wilderness Committee and the Canadian Parks and Wilderness Society, sent a letter to the board Wednesday announcing their immediate withdrawal.

“It’s a sad day. We do not like to fly in the face of regulatory processes,” said Wilderness Committee climate campaigner Eoin Madden in a phone interview. “But we can’t abide by the system any more. It’s too flawed.”

The news came as the energy board was to release its draft conditions for the pipeline expansion. Commenters have six days to respond to the conditions, which are legally required and do not mean the board has made a decision yet.

The latest departures are in addition to the earlier withdrawal of two other high-profile interveners. Economist Robyn Allan announced her exit from the “rigged” process in May, while former BC Hydro chief executive Marc Eliesen called it a “farce” when he pulled out last year.

NEB disappointed by withdrawal

Spokesperson Tara O’Donovan said the board was disappointed the participants had chosen to withdraw.

“As interveners and commenters in the process they had an opportunity to add their voice to the record, and work to influence the decision of the board,” she said in a statement.

The review includes about 400 interveners, who can provide evidence and testimony, and 1,300 commenters, who can submit letters. O’Donovan said the board will consider all submissions and it is committed to a thorough and fair environmental assessment.

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Busting The “Canadian Bakken” Myth

June 9, 2015

Busting The “Canadian Bakken” Myth

The financial pages of Canadian newspapers have been full of headlines lately announcing the potential of two large shale oil fields in the Northwest Territories said to contain enough oil to rival the Bakken Formation of North Dakota and Montana.

The report by Canada’s National Energy Board (NEB) evaluated, for the first time, the volume of oil in place for the Canol and Bluefish shale formations, located in the territory’s Mackenzie Plain. It found the “thick and geographically extensive” Canol formation is expected to contain 145 billion barrels of oil, while the “much thinner” Bluefish shale contains 46 billion barrels.

The report did not estimate the amount of recoverable oil, but points out that even if one percent of the Canol resource could be recovered, that represents 1.45 billion barrels. The calculation immediately had reporters comparing Canol and Bluefish to the Bakken, where the latest USGS estimate shows 7.4 billion barrels of technically recoverable oil (this includes the Three Forks Formation underlying the Williston Basin straddling North Dakota, Montana, Saskatchewan and Manitoba).

“Northwest Territories sitting on massive shale oil reserves on par with booming Bakken field in U.S.,” enthused the Financial Post. “NEB and GNWT study finds 200 billion barrels of oil in the Sahtu,” gushed CBC News, referring to a region of the sprawling territory that cuts across three provinces and touches the Arctic Ocean.

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BC Natural Gas Reserves Inflated, Revenues Overstated, Report Finds

May 29, 2015

BC Natural Gas Reserves Inflated, Revenues Overstated, Report Finds

Analyst David Hughes offers another challenge to the province’s nascent industry.

A new report on liquefied natural gas prospects for British Columbia challenges government claims that gas exports will lower greenhouse gas emissions, or generate $100 billion in profits for the province.

The report published today by David Hughes, one of Canada’s foremost energy analysts and a former federal government geoscientist, also contends that the provincial government has vastly overestimated the amount of gas available for export.

The National Energy Board has approved 12 export licences to Asia or the United States with another seven under review along the B.C. coast.* The provincial government, which has lowered taxes and royalties to promote the new industry, expects only three to five terminals may be eventually built.

Due to depressed oil prices, global competition and cost over-runs in the capital intensive industry, not one project has yet announced a final investment decision.

Government fact sheets claim, for example, that “British Columbia’s natural gas supply is estimated at over 2,933 trillion cubic feet,” or enough gas to last 150 years.

But Hughes notes the B.C. Oil and Gas Commission estimates raw gas reserves (gas that can be drilled and recovered based on existing economics and well data) for the province at 42.3 trillion cubic feet.

The commission calculates “marketable resources,” or what industry might be able to find, drill and frack — a highly uncertain figure, due to high decline rates and the spotty nature of unconventional shale resources — at 442 trillion cubic feet.

As a result, Hughes calls the government’s inflated figure of 2,933 trillion cubic feet, or 70 times more than proven reserves listed by the commission, “a false and irresponsible statement.”

Windfall profits questioned

Government claims about earning windfall profits from gas exports also have no basis in real economics, Hughes argues in his report.

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Trans Mountain pipeline expansion ‘disastrous,’ says Mayor Gregor Robertson

May 28, 2015

Trans Mountain pipeline expansion ‘disastrous,’ says Mayor Gregor Robertson

‘My mind is clearly made up. I think this is a bad deal for Vancouver,’ he said after reading new report

Mayor Gregor Robertson says new evidence proves the expansion of Kinder Morgan’s Trans Mountain pipeline presents a grave threat to the City of Vancouver’s health, economy and environment.

The city commissioned expert reports on the potential impacts of the $5.4-billion proposal and the findings were presented to council on Wednesday.

“Today we heard overwhelming evidence that the Kinder Morgan pipeline proposal and the oil tankers associated with it are incredibly disastrous for Vancouver,” said Robertson outside council chambers after the meeting.

“My mind is clearly made up. I think this is a bad deal for Vancouver.”

The mayor entered a motion to reaffirm the city’s opposition to the project, but council agreed to defer the vote for two weeks after Coun. Elizabeth Ball requested more time to review the findings.

NEB considering proposal

The National Energy Board is considering Kinder Morgan’s plan to triple its bitumen-carrying capacity to 890,000 barrels a day by laying almost 1,000 kilometres of new pipe near an existing line between Alberta and Burnaby, B.C.

The city submitted its expert evidence to the energy board on Wednesday, including critical reports on the project’s economic viability, risk assessment and potential spill impacts.

A Metro Vancouver-commissioned report on health and air quality concluded a spill could expose up to a million people to toxic benzene fumes and kill up to 100,000 birds.

The report said benzene, a component of diluted bitumen, can cause headaches, dizziness, nausea, respiratory problems, coma and even death. People on the Stanley Park seawall next to the water could suffer irreversible health effects, it said.

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