Pipeline Roundup: Trudeau Takes Heat from All Sides, Watches ‘Tens of Thousands of Votes Walk Out the Door’
In the aftermath of the Trudeau government’s breathtaking decision to bail out the Kinder Morgan pipeline on taxpayers’ behalf, much of the news analysis focused on how quickly Ottawa will be able to offload its investment—and whether the pipeline will sell at all, as long as it’s bound up in 17 court challenges and relentless community opposition.
“The federal government is already trying to find a willing buyer to take Trans Mountain off its hands. Investment bank Greenhill & Co. has been hired to pitch the project to everyone from pension fund bosses to private equity investors to pipeline companies,” writes Globe and Mail business columnist Andrew Willis. “But the timing is off,” since changing ownership does nothing to change the public pressures (or, as The Mix and many others have documented, the serious business and financial risks) surrounding the project.
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“No private company will be willing to go near Trans Mountain when the fate of the project remains in doubt,” Willis states. “As long as environmentalists and other opponents believe they can stop the pipeline, its owner will be a political target. No chief executive wants to associate the corporate brand with scenes of pipeline protesters being led away in handcuffs, or deal with endless court challenges from B.C.’s NDP government.”
But Willis still identifies the Canadian Pension Plan Investment Board, as well as First Nations financed by Canadian banks, as potential buyers, once the project appears to them to be more stable.
An editorial in the Victoria Times Colonist points out that day is likely far off.
“The feds haven’t solved all the problems, they’ve just assumed ownership of them, including the risks to B.C.’s coast from increased oil tanker traffic,” the editorial board notes. “The lawsuits seeking to block the project and seeking clarification of jurisdiction are still before the courts.”
And while Finance Minister Bill Morneau might tout Canada’s authority to overcome any resistance to the project, “protesters and their banners are not going to magically disappear,” the Colonist adds. “Some First Nations are not suddenly going to change their views on what they see as violations of their traditional territories and rights. Those opposed to the pipeline expansion will not suddenly feel better about it just because Ottawa is in charge, especially when they consider their tax dollars will now be paying for the project they oppose.”
While Globe and Mail national affairs columnist Gary Mason (along with other analysts and pundits) believes the government left itself no choice but to buy the pipelines, he has no illusions about the political battles ahead. “In one fell swoop, the federal Liberals likely just saw tens of thousands of votes walk out the door,” he writes.
Which means that “anything Mr. Trudeau and his government stand to gain by forging ahead with the pipeline expansion will have to be measured against significant political losses. And they’re still being tallied up.”
“Environmentalists who once applauded Mr. Trudeau and his enthusiastic embrace of the Paris climate targets feel deceived,” Mason understates. As well, “many Canadians will not be thrilled about becoming investors in a pipeline. Recent polls showed that nowhere was opposition to this idea higher than in B.C., where it was running 70% against. This, in a key battleground province for the Liberals come the next election. Indigenous leaders who have vowed to stop the pipeline expansion from proceeding also feel betrayed by a federal leader who promised a new era of consultation and reconciliation.”
Those voices have been everywhere in the days since Tuesday’s bailout announcement, with Indigenous Climate Action Executive Director Eriel Deranger recording a compelling interview with the Democracy Now! network, Idle No More interpreting the cabinet decision as a “declaration of war”, and local protesters tellingBurnaby Now they have no intention of standing down.
Greenpeace’s Mike Hudema pointed out in a CBC interview that the purchase undercuts Canada’s international climate commitments, noting that “you can’t be a climate leader and build a pipeline to one of the largest carbon bombs on the planet. Those two things aren’t compatible.”
That was all on top of the immediate reaction in the hours after Finance Minister Bill Morneau’s announcement.
Richard Kinley, one of the architects of the 2015 Paris Agreement, more guardedly told CBC the bailout raises “interesting questions” about the country’s commitment to drawing down the greenhouse gas emissions that cause climate change, pointing to what he sees as a 50-year timeline for humanity to complete a transition off fossil fuels.
“To me, that raises a question about how policy decisions made now, about pipelines and other infrastructure, how they mesh with this idea that we must now start planning” for a fossil-free future.
Even through a lens that assumes the bailout was the right or only thing to do, the Globe’s Campbell Clark says it could still end badly for Trudeau. “If the government can do what it hopes to—start construction in earnest this summer, and quickly sell all or part of the pipeline to private investors—it could end as a triumph,” he writes. But “if construction is delayed, if costs rise, if outstanding legal challenges become concrete obstacles, if private investors won’t buy in, the Liberals’ critics are lining up to call it a stupid waste.”
In the Toronto Star, veteran columnist Chantal Hébert suggests a second half to Ottawa’s long-standing attempts to lend social licence to fossil production and pipelines by trying to develop viable climate policy: in her framing, the pipeline purchase brings social licence to the floor price on carbon at the heart of the pan-Canadian climate plan.
“Allowing the Trans Mountain expansion to die this week would have cost Trudeau the support of Alberta’s NDP government for his national climate change framework,” Hébert writes. “Looking to next year’s federal election, the demise of the Trans Mountain expansion would have meant giving opponents of Trudeau’s carbon pricing strategy—starting with the federal Conservatives—a prime exhibit in their prosecution of the havoc they argue his policy will wreak on the economy.”
So “while Trudeau is widely portrayed as having picked the polluters’ side in the climate change debate, the Liberals will argue that they have done what they needed to do to continue to advance a pro-environment agenda.”
Yet another emerging battleground is Atlantic Canada, after the Liberals won all 32 seats east of the Quebec border in the 2015 federal election. Within a day of Morneau’s announcement, Conservative Deputy Leader Lisa Raitt was asking him whether he would do the same for TransCanada Corporation’s failed Energy East pipeline.
Trudeau called that project “old news”. But Saint John, New Brunswick Mayor Don Darling tweeted that he was wondering “where was this support for Energy East”, while New Brunswick Liberal backbencher Wayne Long said he wanted Trudeau to revisit the question.
“I’m simply asking my government to take a look at TransCanada, Energy East, and see if maybe the parties of TransCanada, our government, could get together and find a way to revisit, reboot, restart a process that could lead to Energy East coming to Saint John, New Brunswick, my riding,” he said.