The latest issue

Approving Northern Gateway – More Harm Than Good?

With Ottawa days away from deciding the fate of the Northern Gateway twin bitumen and diluent pipelines to tidewater at Kitimat, B.C., there seems little doubt the federal cabinet will give its wholehearted stamp of approval. Every public utterance the government has made before and after the environmental review process points in that direction. But what if, against all odds, the government surprised its detractors and indefinitely delayed or outright turfed the proposal? Hard as that would be to imagine, it could change the dynamic around the oilsands and the efforts to access new markets, for a government with the guts to act counter-intuitively.

The disadvantages of pushing through the pipelines to Kitimat—crossing some 660 fish bearing rivers and streams, numerous First Nations land claims, and communities that have expressed their opposition to the pipelines—are numerous.

First Nations, many of which—unlike in the rest of Canada—have yet to sign treaties ceding territory to Canada, will surely delay construction for many years through the courts, which have been sympathetic to Native historic land claims in several decisions in the past. Environmental organizations will also launch legal challenges, and both are likely to have protesters in the field to obstruct any construction efforts.

Additionally, Victoria has little reason to stick its neck out to support the pipelines, and may actively oppose them. Premier Christy Clark has staked the province's balanced books on liquefied natural gas (LNG) exports out of Kitimat and Prince Rupert. This represents a somewhat delicate balance, whereby First Nations are tentatively on side, but could go off the rails if bitumen/diluent pipelines are forced through their territories. Currently, a compromise of sorts has been struck, whereby natural gas can proceed, but the line is drawn on the oilsands. This seems a reasonable compromise the federal government and oil industry would do well to heed. Otherwise, they could be risking any access to tidewater for hydrocarbon exports on the B.C. north coast.

(Grand Chief Stewart Phillip of the Union of B.C. Indian Chiefs, quoted in the Globe and Mail Monday, said: "In the event that the Harper government tries to ram [Northern Gateway] through with a decision supporting it at the cabinet level ... the fallout from that will serve to poison the well with respect to the LNG efforts… It’s going to completely undermine and damage what’s left of the relationship between First Nations and both provincial and federal governments.”)

And perhaps more importantly, to the federal government, public opinion across B.C. remains opposed. A recent Bloomberg-Nanos poll (Majority in B.C. Want Harper to Delay or Kill Gateway) found not only that the majority of British Columbians would prefer to see the pipelines not proceed or be delayed, but had more trust in what they hear from aboriginal groups and environmental organizations than the federal government and pipeline companies, making it all the more difficult for pipeline proponents to change negative public perceptions.

Bitumen/diluent pipelines forced through against that kind of public opposition raise questions about what impact that could have on the federal election next year. Both the official opposition, the NDP, and the Liberals are against the Kitimat pipelines. In a close race, losing a few B.C. seats over the issue could cost the Conservatives the election, thereby indefinitely delaying or killing the pipelines anyway.

Finally, Canada has already earned an environmental black eye internationally by walking away from Kyoto and ignoring its own watered-down greenhouse gas emissions targets, which are now virtually impossible to meet due to government inaction. With President Obama now taking action to limit coal emissions, and the U.S. on track to potentially meet is own greenhouse gas emissions targets, pressure will only increase for Canada to limit rapidly increasing GHG emissions from our equivalent of U.S. coal emissions—the oilsands. The B.C. “war in the woods” showed the kind of damage a protracted battle can produce, including international boycotts that make the ability to export meaningless.

On the other hand, by killing or delaying Northern Gateway, Ottawa could earn some much-needed environmental credibility—and thereby perhaps advance the case for the Keystone XL pipeline to the U.S. Gulf Coast. It could sooth public opposition in B.C. to bitumen crossing its territory—and by showing compromise perhaps ease the way for the Kinder Morgan plan to expand its existing Trans Mountain pipeline to Vancouver. It could put Ottawa on a path to rebuilding trust with Aboriginal groups over resource development and help to ensure LNG exports can proceed. A delay could also allow for more study of alternatives, like shipping out of the Prince Rupert area instead of down a narrow 100-kilometre fjord out of Kitimat, or building low-emissions refining capacity in B.C. (B.C. group pitches $10-billion ‘environmentally responsible’ refinery) to create a higher value resource and more local jobs, and ease concerns over an offshore spill of bitumen.

Realistically speaking, Northern Gateway as proposed is unlikely to ever be built, whether Ottawa approves it this month or not. Ottawa could get out ahead of the parade of public opinion by delaying or killing it now, and garner significant benefit by doing so. It could show an ability to compromise with its opponents and it could forestall years of acrimonious court, public relations and on-the-ground battles that are sure to erupt—creating years of needless distraction when our attention could be better focused elsewhere. Would Ottawa consider such a strategy? Highly unlikely, judging by its past actions on this issue. But it just might live to regret it.