Texas-based Kinder Morgan is admitting it may have to delay completion of its intensely controversial Trans Mountain pipeline expansion, unless the National Energy Board (NEB) rescinds its own instruction that the company stop installing plastic mats to inhibit fish spawning in several of the rivers the pipeline is intended to cross.
“Those orders, the company said, could allow fish to spawn in areas that would delay the pipeline’s anticipated in-service date, expected to be in late 2019,” National Observer reported late yesterday, noting that the company’s lawyer is asking the NEB for “relief” from the law governing pipeline construction.
Kinder may also have inaccurately reported the number of streams the expanded pipeline would eventually cross, Observer notes.
“Both issues were triggered by a blog posted on Sept. 12 by Kinder Morgan about how it was deploying special mats…to deter fish such as salmon and trout from spawning in streams where they could be killed during construction of the pipeline,” writes Managing Editor and award-winning energy writer Mike De Souza. “The company is legally required to provide an inventory of water crossings before proceeding with construction.” But although the pipeliner identified 25 stream crossing in an NEB submission in June, “it later identified 26 streams in the Sept. 12 blog,” De Souza notes.
“Ten days later, the NEB told Kinder Morgan’s president Ian Anderson in a September 22 letter that the company appeared to be breaking the law, and that none of the work to deploy anti-spawning mats should have begun in the absence of ‘numerous’ approvals.”
That prompted Kinder’s lawyer, Calgary-based Shawn Denstedt of Oskin, Hoskin and Harcourt, to write to the NEB and ask for an exemption from legal requirements, similar to one it granted in response to a previous request in May.
“This time, Kinder Morgan’s lawyer explained there was more on the line if the board failed to ‘expedite’ a request to let the company install deterrents to keep fish away from ‘key watercourses’ with “high spawning potential,'” Observer notes. “Denstedt wrote that if the regulator waited too long, the fish might enter streams on the pipeline route and trigger other rules that would prevent construction from proceeding.”
In a January post on the Seeking Alpha blog, analyst David Alton Clark cited regulatory delays and rising project costs as factors that could not only raise problems for Trans Mountain, but signal a death knell for Kinder Morgan itself. This month, Seeking Alpha’s Jesse Donovan predicted the project will likely be scrapped, and warned investors away from the company.
In an earlier setback for Kinder Morgan this week, the Federal Court of Appeals ruled Tuesday that the Trudeau government will have to renegotiate Kinder Morgan’s access to territory controlled by the Coldwater First Nation in British Columbia, which is in court to oppose Trans Mountain, before the project can proceed.
“In the circumstance, particularly in light of the importance of Coldwater’s interest in its reserve lands, the Crown was under a continuing duty to preserve and protect the band’s interest in the reserve land from an exploitive or improvident bargain,” the court ruled. “The minister’s failure to assess the current and ongoing impact of the continuation of the [pipeline] easement on Coldwater’s right to use and enjoy its lands rendered his decision unreasonable.”
“Now things must change. This is a great day for Coldwater and all First Nations,” responded Coldwater Chief Lee Spahan. “We are very happy that the court recognized the importance of our land to the Coldwater people, and that it is holding the Crown to a high standard of conduct in making decisions about our land.”
Coldwater ‘is one of several First Nations communities in British Columbia that are challenging the federal government’s approval of the $7.4-billion Trans Mountain expansion, claiming Ottawa failed to properly recognize Indigenous rights,” the Globe and Mail notes,. Hearings in that case begin next week. In Tuesday’s appeal decision, the court concluded that Ottawa failed in its legal duty to act in the community’s interest “when it neglected to modernize the terms of a 1952 decision that allowed Kinder Morgan to use Coldwater’s reserve for the pipeline,” CBC notes.
“The existing Trans Mountain Pipeline was constructed through the reserve in 1952. At the time, the band received a one-time payment of $1,292.”
A press secretary for Crown-Indigenous Affairs Minister Carolyn Bennett said she will work with the community’s leadership to address the court decision and chart a course forward. Trans Mountain spokesperson Ali Hounsell told media the decision would have little impact on the project. “The Court’s decision does not affect the day-to-day operations of the Trans Mountain Pipeline nor the Trans Mountain Expansion Project,” she wrote.