Only federal government has authority to approve Trans Mountain
“Hey Christy, buzz off.” That would have been a perfectly understandable response from Kinder Morgan to the BC Premier’s threat Wednesday that she might not “approve” the Trans Mountain pipeline.
“If those conditions aren’t met these projects can’t go ahead, and Kinder Morgan has not met the five conditions,”Christy Clark said. “They need to or it won’t happen.”
You see, the emperor has no clothes. And by emperor I mean Clark and her Liberal government. And by clothes I mean her threat – as stated above – to veto Kinder Morgan’s expansion of its pipeline to 890,000 barrels a day.
It’s not her decision. It will never be her decision.
I interviewed two noted Canadian constitutional scholars, Prof. Margot Young of UBC Law and Prof. Dwight Newman of the University of Saskatchewan, about who has authority under the Canadian Constitution to approve Kinder Morgan’s proposal and what authority the British Columbia government of Christy Clark has, if any.
The answers are, in order, the Canadian government and none.
According to Prof. Young, the Constitution Act of 1867 divides jurisdiction over legislative matters between the federal and the provincial governments. Section 91 sets out federal powers and Section 92 sets out provincial authorities.
But Section 92 has an important exception called the “works and undertakings power” that grants the Canadian government absolute authority over projects – like pipelines – that connect two or more provinces. And that means the federal energy regulator, the National Energy Board, not the BC government, has authority over the Trans Mountain application to build a new pipeline and increase transportation of Alberta oil sands crude to the West Coast from 300,000 to 890,000 barrels per day.
“So it’s absolutely right that this pipeline lies within federal jurisdiction,” Young said.
Prof. Newman cites a long string of legal precedents establishing federal primacy, including a 1954 Supreme Court decision in Campbell-Bennett v. Comstock Midwestern that provinces could not interfere with interprovincial pipelines. In some cases, courts have ruled that provinces must make provincial Crown land available for federally approved projects, like pipelines.
“There can be provincial laws that affect pipelines but they can’t prevent the exercise of the fundamental federal jurisdiction order interprovincial transportation,” Newman said.
And that includes delaying tactics the Province might try to impose. For instance, the BC government couldn’t order BC Hydro to hike Kinder Morgan’s power rate from 10 cents to $100 per kilowatt hour in an effort to make the Trans Mountain pipeline uneconomic to run. Nor could the Province or municipalities deny Kinder Morgan permits or refuse to sell the company land needed for Trans Mountain construction.
“Provincial regulation of these entities [must] not be in conflict with the primary legislative authority that the Federal government has over them,” said Young.
If junior governments did try to hinder Kinder Morgan, the company would have the option of suing for damages, according to Prof. Newman.
“If they were doing it over and over again, it would also be a clear piece of proof that they were doing it to interfere with [pipeline construction]. And Kinder Morgan might pursue legal options out of that, too,” he said.
This suggests that both the BC government and the City of Burnaby – which has been adamant it will do everything it can to block the Trans Mountain expansion – are playing a dangerous game. If the National Energy Board approves Kinder Morgan’s project, as it approved Enbridge’s Northern Gateway pipeline, and the Province and Burnaby manage to frustrate the company with continued legal and regulatory challenges, they could be subject to a civil suit for damages. And given that the Trans Mountain construction budget is pegged at $5.4 billion, could a judge impose a penalty of billions of dollars?
That wouldn’t go down well with BC voters.
So, what the heck is Clark up to? Her government has no constitutional authority over interprovincial pipelines and her hollow threats to deny approval to Kinder Morgan could get the Province in legal hot water under a worst case scenario.
“She’s playing a very complicated political game plan,” Prof. Young. “She’s relying upon the public’s sense that this is a BC issue and BC needs to be listened to about this issue.”
Young says Stephen Harper and the Conservatives came to power on a provincial rights platform, and points to the “dismantling of national health standards” as an example of the Tory’s systematic weakening of federal authority. Which might make Harper reluctant to strongly oppose Clark in BC, where he needs to hold onto all 21 Conservative seats if he hopes to win the upcoming federal election.
Or, Young suggests, Clark actually supports the Northern Gateway and Trans Mountain pipelines but can’t be seen to kowtow to the feds.
“She may want to have the pipeline happen in a way that shows her to have been a strong advocate for provincial interest,” said Young. “And this is the way she can do it.”
Hypothetically, Clark might have more influence over the NEB process and Kinder Morgan’s application with her political bluster about the five conditions and threats to veto than she could ever exercise through the courts or the regulatory review processes.
But British Columbians should be under no illusion that their provincial government has any authority over the approval of Trans Mountain expansion and Northern Gateway.
Christy Clark is bluffing.