It’s been a month of mostly good news for Enbridge and Kinder Morgan, the two companies pushing to build major pipeline projects from Alberta’s oilsands to British Columbia’s coast.
Quick recap: on April 11, the National Post reported that the federal government is drawing up a pipeline implementation strategy for Kinder Morgan’s Trans Mountain Expansion Project and TransCanada’s Energy East pipeline.
Two weeks later, Bloomberg noted the federal government is reevaluating its tanker ban on the province’s northern coast, which currently bars exports from the Enbridge’s proposed Northern Gateway pipeline. On the same day (April 25), Enbridge’s Line 3 replacement project was quietly approved by the National Energy Board, boosting future exports by 370,000 barrels/day.
Capping off the busy spell is the May 6 announcement that Enbridge has requested a three year extension from the National Energy Board for the Northern Gateway pipeline. The company is required to begin construction by 2016 according to its current permits but says it needs more time to lock down legal permissions and further consult with Indigenous peoples.
The reinvigoration of these pipeline projects come on the heels of a major lobbying effort by both Enbridge and Kinder Morgan.
Enbridge and Kinder Morgan Met with Federal Officials a Combined 37 Times Since October
Since the federal Liberals were elected in October 2015, Enbridge has met with federal officials 20 times, including two meetings with Natural Resources Minister Jim Carr, another two meetings with Fisheries and Oceans Minister Hunter Tootoo and one meeting with Transport Minister Marc Garneau.
The company, represented in lobbying activities by CEO Al Monaco, met with Janet Annesley, chief of staff of the Department of Natural Resources and former vice president for communications at the Canadian Association of Petroleum Producers, another three times.
In that same span, Kinder Morgan Canada president Ian Anderson lobbied federal officials 17 times. Four of those meetings included Bob Hamilton, deputy minister of the Department of Natural Resources. The company met with Timothy Gardiner, director general of the department of Natural Resources, another three times.
It also lobbied Gerald Butts, principal secretary and right-hand man for Prime Minister Justin Trudeau, as well as Environment and Climate Change Canada’s chief of staff Marlo Raynolds.
Pipeline Companies ‘Absolutely Desperate to Start Construction’
Such numbers don’t match Suncor’s 46 registered lobbying efforts since October. But they’re certainly notable.
“The concern is that corporations from Texas like Kinder Morgan are able to purchase undue influence due to their ability to afford an army of lobbyists,” says Kai Nagata, Dogwood Initiative’s energy and democracy director. “The content of their lobbying, to my mind, has got to be pretty clear. They’re absolutely desperate to start construction.”
“The longer that they are forced to delay their project, especially in the current price environment, the longer that a review takes, the more their project costs increase and the more money they lose, and the more restless their shippers become,” he adds.
The federal government has attempted to appear neutral on the subject of pipelines, reiterating that the review process conducted by the National Energy Board is intended to be independent.
But the Alberta government has taken a much more aggressive stance, pushing hard for both Kinder Morgan and Energy East despite significant opposition from Indigenous and climate activists.
Resurrected Northern Gateway to Make Kinder Morgan More Appealing
Which makes the rumours around Northern Gateway rather confounding.
Alberta Premier Rachel Notley previously expressed skepticism about the future of the project. Shortly before the province’s election in 2015, she stated that “I think that there’s just too much environmental sensitivity there and I think there’s a genuine concern by the indigenous communities.”
Little has changed on those fronts. The recent B.C. Supreme Court ruling on the province’s failure to consult with Gitga’at and other Coastal First Nations about the pipeline will further delay the project.
Nagata suggests that Enbridge hasn’t counted on Northern Gateway in its business plan for many years (it’s set to spend billions in the coming years on renewable energy projects).
In other words, the supposed resuscitation of the project may serve as a clever piece of horse trading to make other projects appear as the lesser of two evils compared to the highly contentious Northern Gateway.
“[They’ll] throw it under the bus as a sacrifice to move Kinder Morgan or Energy East forward,” Nagata says. “But in order for that strategy to work, they have to make Northern Gateway appear viable.”
Potential Bilateral Trade Deal with China May Increase Pressure on Governments
Such moves require careful coordination. That’s where effective lobbying efforts may well come in.
Nagata suggests that pressures may also be coming from China, which Canada is preparing (and might have already started) to negotiate a free-trade agreement with: “China has made no secret of its desire for a West Coast pipeline and greater ownership of Canadian oil companies,” he says.
Such realities put Canadian politicians in a very tricky spot, given they’re already subject to annual budget cycles and fickle public opinion.
But Nagata emphasizes that B.C. residents aren’t about to sacrifice the province’s coast to make up for poor planning by the governments of Alberta and Canada. If the National Energy Board and federal government ends up approving the Kinder Morgan project, it will come with legal and political ramifications, he says.
“It’s a risky strategy, because I can tell you it’s certainly motivating British Columbians to take a stand for their interests,” he says. “This is a short-term move that will have long-term consequences for these politicians and their political brands, especially in B.C.”