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Court decision nullifies Trans Mountain approval

Federal Court of Appeal says flaws in the Trans Mountain approval must be remedied before project can proceed.

Canada’s Federal Court of Appeal  has rendered its decision in the case of the Tsleil-Waututh Nation v. Canada (Attorney General) with respect to the approval of the Trans Mountain expansion pipeline (TMEP). It is allowing a judicial review challenging the Order in Council, thereby nullifying TMEP’s certificate of approval. The Court cited two flaws in the government’s approval: the fact that project-related tanker traffic was not included within the scope of the National Energy Board’s (NEB) review, and consultation with Indigenous peoples by the the Government of Canada (GoC), while conducted in good faith, nevertheless fell short of legal requirements due to a lack of “meaningful two-way dialogue.”

Industry’s Response

In a radio interview on The Current with CBC’s Connie Walker, CAPP president and CEO Tim McMillan expressed industry’s concern with the ruling and likely delay of the Trans Mountain project.

“The people that work in our industry and Canadians broadly are frustrated by the sort of delay,” noted McMillan in the interview. “It’s frustrating that they [the Government of Canada] haven’t got the consultation done in a way that is adequate to the courts and to the stakeholders involved.”

McMillan expressed industry’s hope that the government will move to address the Court’s concerns “as efficiently as they can.”

Listen to the full radio interview here.

McMillan also noted in an interview with CTV News (below) that it will cost industry $15 billion a year to continue to have inadequate pipeline capacity. “To our industry, it’s already driving investment to other parts of the world,” said McMillan.

CAPP has noted that continued uncertainty regarding Canada’s regulatory process is not in the country’s best interest. It deters foreign investment and results in additional delays, cost overruns, and more red tape. CAPP believes the Canadian government must institute a simpler regulatory framework that provides absolute clarity and certainty needed for investment.

The Decision

The Governor in Council has been tasked with remedying two flaws before a new decision on the project can be made.

The first flaw was that during its process, the NEB did not include project-related tanker traffic when it defined the scope of the project under review. The regulator concluded that in spite of the adverse effects marine vessels would have on the Southern resident killer whale, the project would not likely cause significant adverse environmental effects. This exclusion resulted in the Governor in Council assessing the project without the proper information. Therefore, the Governor in Council must refer the NEB’s recommendation and terms and conditions, back to the regulator, or its successor, for reconsideration.

The second flaw regards the duty to consult Indigenous peoples. The Court determined the Government of Canada (GoC) acted in good faith but fell short of the minimum requirements of Phase III of the consultation process, which required considered, meaningful, two-way dialogue. GoC representatives listened to and recorded concerns of Indigenous participants but “did not disclose responsible, considered and meaningful dialogue.”

Instead, the GoC remained constrained on two limitations: The GoC’s unwillingness to depart from the NEB’s findings to genuinely understand Indigenous concerns; and, the false view it could not impose additional conditions on the approval of the project. This was further exacerbated when the government disclosed the project did not have a high level of impact on the established and asserted rights of the Indigenous participants. As a result, the GoC is required to redo its Phase III consultation.

Once complete, the project can be re-considered by the Governor in Council for approval. The Court indicated the concerns of the Indigenous applicants are specific and focused, meaning the GoC’s dialogue and engagement will also be specific and focused, resulting in a potentially short delay to the TMEP. It also noted the corrected consultation could further reconciliation with Indigenous peoples.

A summary of the decision can be found here.