Originally posted 10 April 2018
Political agendas- staying in power and getting re-elected
- Are environmental groups under undue influence of foreign players?
- Possible Solution – feds exercising its jurisdiction over marine activities?
Canada’s oil and gas industry and financial community and their media allies have ramped up pressure on politicians in Victoria, Ottawa, and Edmonton to reach a deal. Capital hates regulatory uncertainty and Kinder Morgan’s board has finally said “enough is enough.” The parent company of Kinder Morgan Canada is based in Texas and its Texas roots have been used to bolster opposition to the pipeline.
Source: CBCPremier John Horgan faces strong pressure from environmental groups, and especially the Green party which props up his government. Horgan and his Environment Minister Heyman are leading the charge in delaying the project. SOme opinion polls suggest that the province is about equally divided on the matter of permitting the pipeline to proceed.
Much of the narrative out of Calgary and Edmonton says that these environmental groups are foreign (U.S.) financed. A review of Ecojustice 2016 audited financial statements showed that the organization received $3.5 million in donations and $1.2 million in bequests. The website shows that 59 per cent of revenue came from individuals, 20 per cent from bequests, and 16 per cent from foundations. THe organization also posts a link to a CRA filing T-3010. $3,935,010 in receipted donations were received along with $ 936,363 received from other registered charities. $915,129 was also contributed where no tax receipts were issued. Most notably only $ 23,858 was received from all sources outside of Canada (government and non-government). Charitable Return T-3010 Ecojustice
Based on this limited reading, this only leaves any significant foreign funding to be only from foundations headquartered outside Canada.
For Greenpeace Canada unaudited financial statements for 2016 show $12.2 million in revenue of which $8.9 million is from donations and $915,367 from bequests. The website does not give a link to their T-3010 filings. SO in the case of Greenpeace Canada it is difficult to say how much, if any, foreign influence is evident. In its 2015 annual report, Greenpeace claims that over 110,000 people supported Greenpeace financially or “took action online.”
Other groups involved in challenging Trans Mountain through the courts are the Living Oceans Society and the Raincoast Conservation Foundation. Living Oceans Society received $484,000 in revenue in 2016 mostly from government grants and a miniscule amount from individual donations. Raincoast Conservation Foundation sponsors research but the website did not provide information about funding sources. It’s unlikely these particular two groups, when combined could muster the type of policy influence that a government relations department in a large Canadian or U.S> based corporation would have in terms of access to decision-makers, media or marketing spending.
Meanwhile, Premier Rachel Notley is consistently pushing her case for the expansion with both Ottawa and the financial community. She is in Toronto and New York between April 8th and 11th to push the case for “responsible, future-forward energy “production. Her meetings include an investors’ roundtable on energy and a meeting with the Canadian consul general in New York. She meets with “major bank economists and business leaders” in Toronto where she also will deliver a keynote address to the CAPP Energy Symposium. This initiative speaks to a constancy in her deliberative approach to winning social license for pipelines to proceed. Notley’s government’s future appears increasingly tied to building the pipeline. Many in the province have been skeptical about the efficacy of strengthening environmental protection and implementing a carbon tax as a means of creating the conditions for the pipeline builds.
Prime Minster Trudeau has also been in the hot seat with trips to Vancouver where protesters gathered while he attended a fund-raiser. Some analysts focus on the spectre haunting Trudeau Junior the ghost of the reviled National Energy Program. Trudeau appears in a lose-lose situation as Andrew Coyne of the National Post observed in a 10 April column Three ways the pipeline can get built10-4-18 EJ 
There is basically “no way out” for Trudeau. As we’ve observed before, if he pushes through Trans Mountain his party loses precious seats in the greater Vancouver area. If the pipeline does not proceed, his party is almost guaranteed to lose all four seats it holds in Alberta. Hence, the strategy to appear to support Alberta and the constitution, without embittering key communities in the Lower Mainland.
Justin Trudeau’s Trans Mountain crisis10-4-18 GM
Trudeau is further boxed in by the commitment to meet the Paris Climate goals. Environment Minister Catherine McKenna is a team player and has not been critical of the Trans Mountain approval. Her relative silence seems to be mirrored by Resources Minister Jim Carr who has been relatively quiet on this file. Contrast Carr’s performance with that of Conservative Joe Oliver when he held the energy portfolio.
By governments now mulling over public ownership, Kinder Morgan has achieved a small victory. As in past energy battles, the deep pockets of state governments are often tapped to underwrite projects. While Petro Canada’s existence still sticks in the craw of right-wing Albertans, there is a very long history of state involvement including Ottawa’s Hibernia investment; the backstopping of Muskrat Falls development.In free enterprise Alberta, public ownership or sponsorship has included Alberta Gas Trunk Line (the predecessor corporation to NOVA), Alberta Energy Company (privatized eventually becoming Encana), and investments in Syncrude, the Husky Bi-provincial Upgrader project, and the OSLO project.The key issue for Kinder Morgan will be preserving its Baa3 credit rating (Moody’s) in order to grow its base operations. A Government of Canada (Aaa) and/or Alberta (Aa1) guarantee would clearly signal to the financial community (shareholders and
bond-holders) that the company was mitigating its operational and financial risks.
What is the way forward? There seems to be a view that there is no middle ground. While dispassionate observers would say that pipelines are vastly superior to railcars; a potential marine incident is the greatest fear for those living on the Burrard Inlet. It is undoubtedly too late in the day for the constitution of a scientific panel to study the issue as both sides have dug in on the question of bitumen in salt water. According to a 16 January 2017 Blog in the Huffington Post by Blair King an environmental scientist. According to the blog:
The misconception is based on a misreading of a US. National Academies of Science (NAS) report from 2016. The NAS report is an expert review of the literature intended to address a regulatory requirement governing “spill response planning, preparedness, and clean-up.” The scientists who wrote the NAS report did no original research, rather they rely on the research of others.
A key factor in determining the behaviour of the dilbet in water of any kind is the oils exposure to silty water which forms oil-particle aggregates (OPAs) which, under certain conditions, will sink to the bottom. The other key factor is the time it takes to begin the cleanup. The study referenced shows that as time goes on observed increases in density of the dilbet will result in the oil sinking. The blog further notes that “model of an oil spill in the Salish Sea suggests that the majority of the oil would stay on the surface, and accumulate on the shoreline, rather than dispersing into water column. Once again a spill would be a tragedy, but the behaviour of the diluted bitumen would be no different from a similar crude oil spill.”
Assuming this “science” is accurate, then the real question becomes the response time on spills. Would the federal government provide some indemnity to the province for the wreckage caused by an oil spill? Under section 91(10) the Parliament of Canada has exclusive jurisdiction over Navigation and Shipping. Section 91(12) gives Parliament jurisdiction of Sea Coast and Inland Fisheries. If Ottawa wants to play a positive role, perhaps it should exercise its responsibility in this area to assuage B.C.’s concerns in this area.
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