Calgary·Analysis

Pipelines and politics, how the debate has shifted in Canada

In the past two weeks there has been a steady hum of speculation on the pipeline file. Speculation that seems to indicate that the prime minister is ready to grab his pom-poms and start cheering for a pipeline to one of Canada's coasts.

It will take more than political will to get projects approved in Canada

Pipeline in the U.S. (Pan Denim/Shutterstock)

If you pay any attention at all to the pipeline debate in Canada, it has become clear there has been a change in tone in the past few weeks. 

Alberta's premier Rachel Notley was invited to pitch pipelines to the federal cabinet when it met in Kananaskis, Alta. this week. After that meeting, Calgary cabinet minister Kent Hehr told a reporter the table was set in terms of getting oil to tidewater.  

Without being explicit about it, the federal government has sent the message that it's serious about getting an export pipeline built.

The minister says "we have a much better chance now [of getting oil to tidewater] than we had a year ago ... because a credible process is in place." 5:06

Industry is delighted. The Canadian Energy Pipeline Association sent out a cheery news release in relation to a National Post story suggesting pipelines were now on the front burner for the Trudeau government, even though the story quoted unnamed government sources and has never been confirmed.

That's how hungry the energy industry is for good news.

​But as anyone who has followed the pipeline story over the past half decade knows, wanting a pipeline is not enough. After all, no one doubts Stephen Harper really wanted pipelines built. Fat lot of good that did him.

Why the change in tone

No one doubts the Canadian economy has taken a hit from the drop in energy prices. It slipped into recession in the first half of 2015 and the recovery since has been choppy.

A memo prepared for the federal Department of Finance and released to CBC News through an Access to Information request showed that as oilsands growth continues to slow, so will the Canadian economy. 

"Incremental growth in the oilsands may be held back by uncertainty over export capacity, as current pipeline capacity is full," read the note.

Canada has no control over the level of oil prices but does have control over market access, which would help Canadian oil producers fetch a higher price for their products.

At the same time, the federal government has an ambitious spending program that needs to be paid for with a strong economy.
Rueben George of the Tsleil-Waututh Nation says his band is saying no to what he calls a "flawed process" for pipeline approval at the National Energy Board. (CBC)

First Nations support 

Kinder Morgan's TransMountain pipeline has the most potential to be approved in a timely manner. But serious obstacles remain, including First Nations approval.

As part of the new pipeline approval process, representatives from Natural Resources Canada recently began meeting with First Nations along the TransMountain route as a start of "government to government" negotiations.

Some First Nations along the route have signed economic benefit agreements with Kinder Morgan, others are still talking to the company, while some remain steadfastly opposed.

"This is not just a matter of Prime Minister Trudeau rolling up his sleeves and getting the job done," said Scott Smith, a lawyer representing the Tsleil-Waututh Nation. 

Tsleil-Waututh's territory includes Burrard Inlet, and Smith said the nation is looking to participate in the decision-making process in relation to whether the pipeline can go ahead.

"All these back-room political dealings ignore Tsleil-Waututh's decision-making authority and jurisdiction, including its right to say no to the Trans Mountain Expansion Project," said Smith.

Opposition in lower mainland

According to a poll commissioned by CBC News, fewer than 40 per cent of British Columbians support the TransMountain expansion.

B.C. Premier Christy Clark has said that five conditions need to be met in order for B.C to approve a pipeline through the province. 

The conversations between Alberta and B.C. over trading hydro power purchase agreements for pipeline approval may fulfill one of those conditions, said Andrew Grant, program director with Conversations for Responsible Economic Development.

"This quid pro quo gives Christy Clark's government some really nice cover," said Grant. "Revenue from power sales would provide an excellent check box of one of the five conditions  So you start to see how the whole thing starts to work." 

Grant said that small business groups and tradespeople would be thrilled with the TransMountain approval, a whole other swath of people would not.

"It is very politically risky."

Political will is important.

Under the right conditions though, that risk lessens. Ultimately, pipeline approvals are a political decision, so political will is hugely important, said Trevor McLeod, with the Canada West Foundation.

"The question has always been what happens if you say yes and then you get massive protests or social unrest on the pipeline route."

If that happens, it really matters what the people in the middle think.

"Does the Canadian public broadly support what you've done? You have to be seen to be doing enough," said McLeod.

"That's where Alberta's climate strategy comes in, that's where consultation with First Nations along the route comes in. You're never going to get unanimity."

McLeod thinks the prime minister is trying to thread that needle.

"He's tried to hold up two distinct notions at the same time," said McLeod.

"First is the responsibility of the prime minister is to gets goods to market. And two, establishing the government as a referee instead of a cheerleader, He's running headlong into that tension and it seems to be that he's leaning towards becoming that cheerleader, or at least a hometown referee."

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