Allison Sears -
2015 was not been a banner year for major inter-provincial or international pipeline projects in Canada. Apart from Enbridge finally being granted leave to open its Line 9 Reversal Project, 2015 brought little progress to report on the market access front as most of the major projects were mired in various procedural delays. Despite plummeting oil and gas prices, no proponents cancelled their major oil pipeline projects, and access to tidewater remains crucial to the viability of Canada’s energy sector. In fact, with President Obama’s symbolic rejection of Keystone XL (an indiscreet indictment of the carbon footprint of Canada’s oil sands) and the ever-increasing reliance by the US on its domestic oil and gas, the issue of access to markets beyond the US is top of mind for oil and gas producers. Shell Canada, for example, cited lack of pipeline capacity as one of the reasons for its cancellation of the 80,000 bpd Carmon Creek oil sands project, which was in mid-construction and for which Shell took a $2-billion impairment charge.
Significantly, 2015 marks the end of the Harper era, which made market access a priority, but failed to deliver in a meaningful way. Arguably, Harper’s streamlining of the environmental assessment process through amendments to the Canadian Environmental Assessment Act and the National Energy Board Act, among others, only fuelled anti-pipeline fervour and increased provincial intervention. The election of the Liberal majority government will have implications for the development and permitting of federally-regulated pipelines. Prime Minister Trudeau’s mandate letters to his Ministers of Environment and Climate Change, Natural Resources, and Fisheries, Oceans and the Canadian Coast Guard reveal that (i) a review of Canada’s environmental assessment process to regain public trust is to be undertaken immediately; (ii) the National Energy Board (NEB) is to be modernized to ensure its composition reflects regional views and has sufficient expertise in fields such as environmental science, community development, and Indigenous traditional knowledge; and (iii) a moratorium on crude oil tanker traffic on British Columbia’s North Coast is to be formalized.