Prime Minister Mark Carney speaks alongside Alberta Premier Danielle Smith in Calgary on July 2. The West Coast pipeline is a large part of his response to the Alberta secessionist campaign.Ahmed Zakot/Reuters
The federal government is poised to list the newly proposed West Coast oil pipeline as a project of national interest by Thursday, Energy Minister Tim Hodgson said.
The pipeline is a key part of Prime Minister Mark Carney’s suite of policy changes that aim to reset federal relations with Alberta and diversify Canadian exports away from the United States.
The national interest designation is allowed through the Building Canada Act, passed by the Liberals as one of the Prime Minister’s first orders of business last year. It says that projects deemed to be in the national interest will “be advanced through an accelerated process that enhances regulatory certainty and investor confidence.”
In May, Mr. Carney’s government said it would designate the proposed pipeline a project of national interest under the Building Canada Act by Oct. 1. That process is being led by the federal Major Projects Office, headquartered in Calgary.
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In a Tuesday interview with The Globe and Mail, Mr. Hodgson said that the MPO is still completing the steps needed to make the designation official.
“They need to finish that work. I have every reason to believe they will do the work and get it done on time,” he said.
“But we’re not going to prejudge that. They’ve got to do the work.”
A decade’s worth of federal Liberal climate and energy policies under Mr. Carney’s predecessor, Justin Trudeau, stoked separatist sentiment in Alberta that this year boiled over into an impending referendum. Voters will decide on Oct. 19 whether to remain in Canada or lay the legal groundwork for a second, binding referendum on splitting up the country.
The pipeline is a large part of Mr. Carney’s response to the secessionist campaign. The conduit would also reduce Canada’s reliance on the U.S. market, where more than 85 per cent of the country’s oil goes – an attractive prospect given the fractious trade relationship.
When the Prime Minister first announced the potential pipeline in 2025, he said it would have to be “private sector constructed and financed.” However, when the project was finally revealed in July, the government said that taxpayers would foot the bill. Ottawa and Alberta agreed to split the vast majority of the costs. The only private-sector player is Pembina Pipeline Corp., which made a non-binding agreement to take a 10-per-cent stake during construction.
Oil, gas and business executives close to the federal and provincial governments told The Globe that they expect the Carney government will follow through on its pledge to designate the pipeline as a project of national importance this week.
Pointing to the coming separation referendum, they indicated that it was unlikely that Ottawa would delay a designation with the future of Alberta’s ties to Canada in question.
The Prime Minister’s Office declined a request for comment on Tuesday from The Globe.
An oil pumpjack near Claresholm, Alta. The national-interest designation is allowed through the Building Canada Act, passed by the Liberals last year as one of Mr. Carney's first orders of business.Todd Korol/Reuters
The government has repeatedly said that hastening approval processes under the new rules would not trump the requirement for Indigenous consultation. However, the three months between the July announcement of the proposed pipeline route and the Oct. 1 designation left little time to consult with the more than 100 Indigenous groups along the line’s potential right of way.
One source with direct knowledge of the outreach from the MPO to some of the Indigenous groups said they believed Ottawa is getting ahead of itself if it plans to move ahead with the national interest designation on Thursday.
They said such a timeline would mean full consultations are not yet complete, and they questioned whether the move would be consistent with the language in the Building Canada Act.
The Globe is not identifying the source who was not permitted to disclose details of confidential talks.
One of the groups opposing the fast timeline for the designation of the West Coast pipeline as a project of national importance is the Coldwater Indian Band, in B.C. The group also opposed the Trans Mountain Expansion Project owing to concerns about risks to the community’s aquifer.
On behalf of the band, Vice-Chief Michael Smithers said in an e-mail that there has been a lack of meaningful consultation between the community and the Major Projects Office about the new pipeline.
While the MPO extended the band’s deadline to submit its concerns over the project, after the community spent two of the past three months in a wildfire state of emergency, the community’s Sept. 18 request to delay the national interest designation received no response as of Tuesday afternoon, he said.
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In an interview, Mark Podlasly, the CEO of the First Nations Major Project Coalition, said his group does not have a formal position on the new pipeline but he stressed the need for Indigenous people to be meaningfully involved from the start.
“If you do not include Indigenous people from the beginning, in all projects, you may run into trouble later,” he said.
He said the First Nations in his coalition want to participate in the projects in their territories, but it requires involvement in all aspects of the project, including environmental and economic. Mr. Podlasly briefed Mr. Carney’s cabinet at its recent retreat in Banff, Alta.
The British Columbia government also opposed a new pipeline to the West Coast, but it said it would not challenge the federal project because it falls within Ottawa’s jurisdiction. In July, Mr. Carney extended an olive branch to the province in the form of funding for various other major projects and initiatives in B.C.
Mr. Carney was in Vancouver Tuesday to announce $1.2-billion to increase ocean monitoring, strengthen science and ecosystem protections, and improve marine incident prevention.
During his press conference, the Prime Minister tried to make the case that his government can protect the environment and sensitive ecosystems while at the same time building massive new projects.
The Alberta government has been pushing hard to get the West Coast pipeline designated as a project of national importance, arguing that the conduit would reduce Canada’s reliance on the U.S. market and allow Alberta oil to access higher international crude prices.
Speaking at an energy services industry event in Calgary on Monday, Premier Danielle Smith said she expected a designation decision from the federal government “very soon.”
“My chief of staff Rob Anderson is here in the room, and I keep asking him if I should lower the expectations around an October 1 conditional approval, and he keeps telling me ‘No,’” she said.
“We expect the project to receive the green light, which will unlock Alberta’s energy potential.”
Not only is Ms. Smith expecting a nod from Ottawa, she said she is also “feeling more and more confident every day” that the West Coast oil pipeline could be one of the first major projects to begin construction.
“I anticipated when we started our conversation with the federal government that it might be a little bit further down the line,” Ms. Smith said. But the recent turmoil in global energy markets caused by conflicts in the Middle East and Ukraine has countries around the world searching for more stable fuel supplies – and they’re looking to Canada as an option, she said.
“So I think that there’s been an urge on the part of the country, on the part of the federal government, to get that one built,” she said.
With a report from Mike Hager