​Trudeau and taxpayers take it on the nose in Trans Mountain fight

Last week was Donald Trump’s nightmare, what with his major aides flipping on him. This week is Justin Trudeau’s, what with his major issues flipping on him.

Trudeau’s government may salvage a trade deal in the hours ahead, but the preservation of the Trans Mountain pipeline twinning – the one we now own, thanks to a quick shareholders meeting today of Kinder Morgan to approve the transfer – is a vastly different matter.

For those who believe that process is important, Exhibit A is the Federal Court of Appeal ruling Thursday that the process wasn’t sufficiently important to the government. First Nations weren’t adequately consulted – deeply ironic, considering the prime minister’s much-stated intentions on reconciliation and respect – and the impact of tankers on the environment wasn’t adequately studied by the National Energy Board.

The consequences for the $7.4 billion-and-counting pipeline might not be fatal, but for the time being, the body is on life support. There is no certificate to construct, so the tools are downed and may be for a year or two or longer. The foes may have delayed just long enough to make the lemon of today into the white elephant of tomorrow.

But the three-person panel’s court decision leaves many open questions that fall far short of supporting the jubilance in some quarters that this signals a seismic change in either how clearly the broad-based First Nations must assent or how projects of such magnitude must not disquiet the environment.

Clearly the so-called “phrase three” of Indigenous consultations, the cabinet-directed note-taking and reporting back, was inadequate. But what is adequate? The court didn’t say.

Clearly the National Energy Board’s decision to avoid exploring elements of the impact of the project on marine life was inadequate. But what is adequate? The court didn’t say.

There are better and lesser ways for the government to navigate. It could attempt to fix what the court says ails the project, even if it means a new string of court challenges once it’s done, or it can appeal to the Supreme Court and hope it overturns what the Federal Court determined. It could even do both.

Trudeau would have – or should have – known this was an eventual episode. So many court cases clutter the project’s path, one was bound to trip it.

Eventually the courts offer Trudeau an ultimate excuse if the pipeline twinning does not proceed. He can argue he gave it the college try. But that is for a much, much later day.

Trudeau has no real choice now but to keep his dukes up in the ring, and his finance minister kept a brave face today in saying all was not lost. Having made a most difficult choice as a national government to proceed, then having doubled down in buying the project, there is no true turning back for a variety of reasons – credibility among them.

But the context is much more forlorn today than yesterday, just as yesterday was much more forlorn than a few months ago.

If the pipeline was a path to a national climate change action plan, well… today the realpolitik is an Ontario premier who wants no part of a carbon tax, an Albertan premier likely to be replaced with another premier who wants no part of a carbon tax and a British Columbian premier who will occupy the court and oppose the project for some time. Not exactly a consensus looming.

The economic context involves immediate job losses on construction in Alberta and British Columbia and a renewed sense that Canada is a delicate flower for any foreign investment in a megaproject. To global capital, we seem shambolic.

Growing crude oil volumes will still ship, but for the foreseeable future only by rail to America, elements of which have of course helped finance the opposition to the pipeline but not necessarily the principle of satisfying its energy appetite.

The smartest people in the room seem south of the border: the executives at Kinder Morgan who threatened the mothball the Trans Mountain project because of uncertainties.

Talk about timing: a shareholders meeting to sell to the government on the morning of a court ruling to quash that government’s certificate to build. I can imagine being in that room for the vote on the sale: “All in favour, say ‘Duh.’”

— Business in Vancouver

Kirk Lapointe is editor-in-chief of Business in Vancouver and vice-president of audience and business development with Glacier Media.  

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