Intergovernmental Affairs Minister Dominic LeBlanc responds to a question in the House of Commons on April 28.Sean Kilpatrick/The Canadian Press
In an effort to boost investor confidence, the federal government is proposing to reverse the order of pipeline approvals, allowing cabinet to green-light new projects prior to the completion of technical assessments and approvals.
The change is part of a raft of proposed new regulations and legislation that Ottawa says are all aimed at streamlining and speeding up the review process for industrial projects. The changes were released less than two months before Alberta is expected to submit a proposal for a new pipeline to the West Coast.
“This sends a message to investors and, frankly, to Canadian businesses that worry about our competitiveness,” Intergovernmental Affairs Minister Dominic LeBlanc said Friday in Montreal.
“The government is going to ensure that we do all of these regulatory processes in a much more efficient and coherent way.”
Among the other proposed changes are the promise of a maximum one-year federal review period for all projects, regulatory changes to ensure a single federal decision-making process, the creation of “economic zones” across the country and faster review times for nuclear facilities.
Mr. LeBlanc said provincial and territorial premiers were notified of the proposed changes in a letter sent Friday.
The news was welcomed by business and industry groups that described the impact assessment regime brought in by Justin Trudeau as chilling for investment. The changes represent “a moment for Canada to move from debate to delivery,” said François Poirier, the chief executive of TC Energy Corp.
However, environmental and climate groups argued the changes could put ecosystems and species at risk. “If approved, this proposal will take Canada back to a more dangerous, toxic and destructive time,” said Tim Gray, executive director of Toronto-based Environmental Defence.
Oil, steam and natural gas pipelines run through the forest near Cold Lake, Alta., in a 2012 file photo.Todd Korol/Reuters
Ottawa said it is not sacrificing environmental protections and that it has an economic imperative to act.
For too long major projects have “been bogged down in red tape, leaving enormous investment on the table,” the government said in its news release.
Environment Minister Julie Dabrusin was not part of Friday’s announcement. In a statement, her office said she supports the changes.
The sweeping changes were released the same day Alberta Premier Danielle Smith touted significant progress in a deal with Ottawa on an industrial carbon price and a carbon-capture project. Details on those two issues are a critical component of Ottawa’s willingness to support a new pipeline. Her proposal is expected by July 1.
She said she and Prime Minister Mark Carney had a “meeting of the minds” during negotiations in his office Friday. She said she hopes a deal will be finalized “very, very soon.”
Smith touts ‘significant progress’ between Alberta and Ottawa on pipeline deal
Ottawa is changing the order of approvals for new pipelines to ensure proponents know whether there is political buy-in before they go through an expensive and time-consuming technical review.
It was not immediately clear whether a pipeline project could still be scuttled during the technical review or if the cabinet decision would be final. “I don’t want to surmise what the legislation might ultimately look like,” Mr. LeBlanc told reporters.
He added that the technical review would articulate “the appropriate conditions” for a new pipeline.
Mr. LeBlanc appeared to downplay the potential for a conflict with British Columbia, where Premier David Eby has been skeptical about a new pipeline to the West Coast. Mr. LeBlanc said the two governments would continue to talk.
The B.C. government did not have an immediate response Friday to Ottawa’s proposals.
The federal government has not yet said which pipelines would be covered by the new regime.
Andrew Leach, an energy economist at the University of Alberta, said the new rules could still leave projects vulnerable to political policy whims. There’s also a risk Ottawa might sign off on a pipeline before there is adequate information about its route and design, he said.
“If it’s clear that the government is approaching this with the intent to have a thorough process, and one which accommodates Indigenous rights and concerns with adequate consultation all the way along, then it’s workable,” Prof. Leach said. “But it also creates that trap where you start trying to make decisions more quickly and you end up creating errors.”
The proposed changes reach far beyond pipelines. New federal economic zones would include things such as transportation corridors, telecommunications networks, mines and energy production projects. The zones would be created through new legislation and cabinet would decide which types of developments would be preapproved in a given area, but there could still be project-specific conditions.
Trump’s approval for U.S. pipeline a key milestone, but South Bow keen to manage potential risks
Energy ministry spokesperson Carolyn Svonkin pointed to B.C.’s Golden Triangle as a potential contender for such a designation, because there are already multiple proposed projects in the area.
The government says the zones would be contingent on provincial or territorial agreement and Indigenous consultation.
Ottawa is also proposing shifting responsibility for assessments of nuclear and uranium facilities solely to the Canadian Nuclear Safety Commission. Since 2019, those assessments were done jointly with the Impact Assessment Agency of Canada.
The change would apply to projects already in the planning phase. Those for which full studies have already been submitted will continue under the current regime.
Mr. Carney endured early criticism last year over his government’s handling of consultations with Indigenous groups around the rollout of the Major Projects Office and the rapid passage of his signature law meant to fast-track projects that the government deems in the national interest.
Friday’s announcement makes repeated reference to the need to consult with Indigenous groups and says the government will create a new Crown Consultation Hub within the Impact Assessment Agency of Canada.
Reaction was mixed Friday, with the Assembly of First Nations calling for more meaningful consultation, and the Assembly of Manitoba Chiefs warning against putting speed ahead of consent.
Still, David Chartrand, president of the Manitoba Métis Federation, said he is comfortable with the proposals.
“They’re asking us to trust them, and we’ve been cheated on that before,” he said in an interview. “But ultimately, I support them now because these projects are about making sure we have a united future for all our peoples.”
Friday’s announcement kick-starts a 30-day consultation window in which stakeholders can weigh in on the plans.
With reports from Stephanie Levitz, Matthew McClearn, Jeff Gray and Justine Hunter