The Federal Court of Appeal dealt the Trans Mountain expansion project a major setback Thursday, ruling the government of Canada had not fulfilled its duty to consult with First Nations on the pipeline from Alberta to British Columbia.
The decision means the National Energy Board will have to redo its review of Kinder Morgan Canada’s project. In a written decision, the court says the energy board’s review was so flawed that the federal government could not rely on it as a basis for its decision to approve the expansion.
The court also concludes that the federal government failed in its duty to engage in meaningful consultations with First Nations before giving the green light to the project. That decision means the government will have to redo part of its consultations with Indigenous groups.
The judge wrote that “the consultation framework selected by Canada was reasonable and sufficient. If Canada properly executed it, Canada would have discharged its duty to consult.”
“However, based on the totality of the evidence I conclude that Canada failed in Phase III to engage, dialogue meaningfully and grapple with the concerns expressed to it in good faith by the Indigenous applicants so as to explore possible accommodation of these concerns,” the ruling states.
The Trans Mountain expansion would add shipments of 590,000 barrels of oil per day from Alberta to British Columbia by twinning an existing pipeline at an expected cost of $7.4 billion.
Kinder Morgan shareholders approved the sale of the pipeline with more than 99 per cent support Thursday, less than an hour after the federal government learned the pipeline construction permits had been quashed.
“No matter who owns this pipeline and tanker project, it will be stopped,” president of the Union of B.C. Indian Chiefs and Grand Chief Stewart Phillip said in a release.
“Kinder Morgan executives recognized Justin Trudeau’s desperation to placate the oil lobby and are exiting the project with massive profits on the backs of Canadian taxpayers,” he said.
The Federal Court decision will effectively compel the NEB to repeat the third phase of its consultation process, which it carried out between February and November, 2016.
The NEB has not taken marine traffic implications into account in its prior decisions.
The regulator had argued that “since marine shipping was beyond its regulatory authority, it did not have the ability to impose specific mitigation conditions to address environmental effects” of increased marine traffic.
In recent years the NEB has been hobbled by broader questions about what should be the scope of its approval process. Last year, TransCanada Corp. halted its Energy East project after the NEB unexpectedly announced it would include downstream emissions in its environmental review of the pipeline.