Federal Court of Appeal quashes approval of Trans Mountain pipeline expansion

Kilometre Zero of the Trans Mountain pipeline system at the Kinder Morgan Edmonton Terminal in Edmonton.					David Bloom  Postmedia file

Kilometre Zero of the Trans Mountain pipeline system at the Kinder Morgan Edmonton Terminal in Edmonton. David Bloom Postmedia file

Like a sports team riding an improbable winning streak, the Trans Mountain pipeline's run of 16 straight legal victories ended in stunning fashion Thursday when the Federal Court of Appeal quashed the federal government's approval of the project.

The ruling requires the energy board to conduct a new review -which the court suggests could be kept short - and means the government will have to redo part of its consultation with Indigenous groups.

The case combined almost two dozen lawsuits and contended that First Nations were not adequately consulted with before a review by the energy board or cabinet approval of the project.

In a win for First Nations and environmentalists the court ruled both that Canada did not fulfil its obligation to consult with the Indigenous communities involved in the case and failed to fully assess the impacts of the project.

Trudeau's Finance Minister, Bill Morneau, said he would speak about the decision on Thursday afternoon.

First Nations, including the Tsleil-Waututh and Squamish on British Columbia's south coast, argued that Ottawa did not adequately consult them before the review or the cabinet decision to approve the project.

"If the business community doesn't have confidence that responsible resource development will be moving forward in this country, that sends a pretty strong signal that Canada may not be open for business", he said.

"We believe this project is in the national interest, we believe that it's critically important for our economy, critically important to allow us ... to get to global markets", said Morneau.

Trans Mountain started to take measures Thursday to suspend construction-related activities on the pipeline. Trans Mountain is now taking measures to suspend construction related activities on the project in a safe and orderly manner. The project was considered not only for jobs, but for better oil prices that Canada hopes to garner in overseas markets.

"Taken together, today's decisions from the Federal Court of Appeal and Kinder Morgan shareholders are important next steps in getting this project built in the right way for the benefit of all Canadians", he said in Toronto.

"My sense of it would be that the federal government should get on with the proper consultation and view this as a delay", he said.

The pipeline project faces stiff environmental opposition from British Columbia's provincial government and activists.

Kinder Morgan shareholders voted overwhelmingly, 99 percent, to approve the $4.5 billion Canadian (US$3.4 billion) sale of the pipeline to the government shortly after the court decision was announced.

The decision was a major victory for Canadian First Nations, environmental groups and USA tribes that opposed the pipeline expansion.

Lee Spahan, chief of the Coldwater First Nation in the Nicola Valley - which he said is known as the people of the creek - said the ruling helps save water.

"The government should never have bought this pipeline", he said.

"Our reference case establishing jurisdiction not just for this government but for future B.C. governments is still important", Horgan said.
The federal government also committed to invest an additional $7.4 billion to twin the pipeline to ship oil products from the Edmonton area to Burnaby, B.C. It would also increase the number of tankers in Burrard Inlet sevenfold.

"The unjustified exclusion of marine shipping from the scope of the project led to successive, unacceptable deficiencies in the board's report and recommendations", Dawson wrote, noting that the Governor in Council "could not rely on the board's report and recommendations when assessing the project's environmental effects and the overall public interest".

Environmental groups and the cities of Vancouver and Burnaby also challenged the project in Federal Court last fall.

While the project could allow Alberta to get its bitumen to markets in Asia and reduce its reliance on the USA market, there has been opposition over the potential for oil spills and the impact that a dramatic rise in tanker traffic could have on the region's southern resident killer whales, a population already on the knife edge of extinction.

The decision is likely to be appealed to the Supreme Court of Canada either way, Hoberg predicted, and another 18 months to two years will pass before it's settled.

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