Kinder Morgan Quash


A Healthy Serving of Quash

On August 30, 2018 the Federal Court of Appeal issued a ruling quashing the approval of Kinder Morgan’s Trans Mountain Expansion Project. A half hour later Kinder Morgan shareholders voted almost unanimously to sell the 65-year old Trans Mountain system to the federal government for $4.5-billion dollars.

In 2007 Kinder Morgan reported the value of the existing system as $550 million. The federal purchase was also to include the permits, work to date, and shipping commitments for the Expansion Project. With Project approval gone, it is uncertain now whether that $4.5-billion buys anything more than a geriatric pipeline with all of its liabilities, and a pile of incomplete construction plans. The twinning project had not even completed pre-construction NEB conditions and route approvals.

The unanimous decision by the Court was a rebuke to federal governments, former and current. The NEB process was described as so flawed on multiple points that the Board’s recommendation report did not meet the definition of a “report”. The Court found that the Governor in Council erred in depending on the NEB report and failed in its own diligence in making the decision approving the Project.

In response to arguments by Tsleil-Waututh Nation; Squamish Nation; Musqueam Indian Band; Coldwater Indian Band; Aitchelitz, Skowkale, Shxwá:y Village, Soowahlie, Squiala, Tzeachten, Yakweakwioose, Skwah, & Ts’elxwéyeqw Tribe; Upper Nicola Band; and Stk’emlupsemc Te Secwepemc, the Court said that government failed to respond to concerns in a meaningful way and “did not appear to give any consideration to reasonable mitigation or accommodation measures”.

Raincoast Conservation Foundation and Living Oceans Society, represented by Ecojustice, argued among other things that the NEB and Governor in Council failed to uphold the Species at Risk Act with respect to endangered Southern Resident orcas. The Court agreed, finding that the NEB unjustifiably excluded Project-related marine shipping from the Project’s description and failed to apply the Species at Risk Act to its consideration of the effects of Project-related marine shipping on the Southern Resident whales.

The result of NEB and federal government failures is that the Governor in Council approval of the project and the Certificate of Public Necessity and Convenience for the Project were quashed.

WaterWealth’s Role

WaterWealth has been engaged on the Project since our launch in March 2013. We were an intervenor in the initial NEB hearing, from our application to participate in February 2014 to the close of the hearing in February 2016. In 2015 WaterWealth led community opposition to Kinder Morgan’s offer of $800,000 to the City. We filed a motion asking the NEB to stop Kinder Morgan from making such offers to hearing participants while the hearings were under way, arguing that cash offers to participants cast doubt over the integrity of the process. (NEB turned that motion down.) When the City did make a deal with Kinder Morgan after the NEB hearing, they settled on $1.2-million. Not a bad bonus for taking an ethical position during the hearing. Late 2016, with federal and provincial Project approvals imminent, our work turned from arguing that the Project should not proceed, to arguing that if the project is built it should not be built along the old pipeline route across Chilliwack.

Risks could be eliminated from City of Chilliwack and Yarrow Waterworks water sources, residential neighbourhoods, schools, and some of the region’s most valued recreational and ecological areas by changing the pipeline route to follow Highway 1 between points east and west where it crosses the highway already.

Residents of Chilliwack engaged on the issue like no other community. Not even Burnaby, with its very vocal opposition to the project and nearly three times Chilliwack’s population, matched Chilliwack for the number of statements filed with the NEB. One of the NEB Panel said during the segment 6.3 realignment hearing that the level of engagement by Chilliwack residents was why that realignment got a full hearing when realignments are usually just a paper exercise.

While the realignment Kinder Morgan put forward demanded opposition for the risks it imposed on the community, it was also a very welcome practice run. An opportunity for WaterWealth’s Program Director to see how these hearings were being conducted, to gather information, and to get some experience at being cross-examined and conducting cross-examination. With the end goal of changing the entire route across Chilliwack, the outcome of the 1.8 km realignment segment 6.3 didn’t really matter. Indeed, the outcome of the realignment hearing was almost certainly pre-determined, given that the Board had before it Kinder Morgan’s original route, which had proven impossible to construct, or Kinder Morgan’s proposed alternative. Given a choice of impossible or bad, it seemed likely the NEB would rule in favour of bad, and that they did.

Practice over, the main event was the detailed route hearings for the whole of segment 6. But despite participation as an intervenor in the initial NEB hearing and in the realignment hearing, WaterWealth was excluded from the detailed route hearings! Often when the NEB reject an intervenor application they allow the lesser participation as a commenter. Our application did not even get that! This led to a flurry of activity geared to setting up other options, and fortunately we were subsequently accepted by the NEB as an intervenor in the City of Chilliwack’s hearing. We took that, fingers crossed that the City would see it through to the end. If the City dropped out at any point, the hearing would end and our participation in the regulatory process would end with it.

The segment 6 hearings were initially to be in two phases, but at Kinder Morgan’s request the whole works got moved to the timeline of Phase 2. On that timeline Kinder Morgan filed their written evidence August 23. (Coincidentally our Program Director’s birthday. Kinder Morgan’s evidence made a welcome present!)

Our written evidence was due September 13, however, with the Project approvals nullified August 30 it seemed the detailed route hearings must stop. We waited for word from the Board.

A lawyer for a late hearing in segment 2 in Alberta wrote the Board saying;

As the Order in Council approving the TMEP and directing the Board to issue a Certificate of Public Convenience and Necessity has been quashed, there is no longer any basis on which to proceed with Trans Mountain’s Application for approval of its detailed route.

Kinder Morgan wrote regarding the same hearing (but apparently only that hearing) saying in part;

We are writing on behalf of Trans Mountain to request that the Board suspend all remaining steps in the above noted proceeding in light of yesterday’s ruling from the Federal Court of Appeal in Tsleil-Waututh Nation v. Canada

After what felt like an eternity (but was actually just the next day), the Board posted to its website a notice that read in part;

Ongoing processes directly related to the Trans Mountain Expansion project, including consideration of condition compliance filings, Right of Entry applications and detailed route hearing processes, will cease.

As a hearing participant we assume we’ll receive something further from the NEB confirming that our hearing is off, but it seems there is no doubt that is the case. At least for now.

What’s Next

Since the court decision, the federal government has been talking tough about getting the pipeline built. A shame they don’t care as strongly about protecting communities’ drinking water sources! The Project is in a shambles now though, with multiple hearings cut off part way through, none of segment 6 and parts of other route segments including the Fraser River crossing and reroute of the old pipeline into the Burnaby tunnel not approved. And the very complex issues raised in the court decision to grapple with.

Hawkish statements by Trudeau and his Ministers may be shooting themselves in the foot with regard to future litigation. How can they argue they went back and engaged in meaningful consultation with First Nations when they’ve already declared in no uncertain terms their predetermined outcome? That is just the sort of approach the courts just threw back at them! (Check out Walking Eagle News for a humorous take on that!)

Estimates of how long it will take the Project to get back to the stage it was at the day before the court decision range from months to years to never. WaterWealth’s pipeline plan takes two routes looking forward.

First, in Chilliwack we still have the 65 year old pipeline sitting over our drinking water and running through residential neighbourhoods within mere metres of peoples’ back decks, across schools, and where it threatens regionally significant salmon habitat areas and the Great Blue Heron Nature Reserve.

The existing pipeline started in 1953 as a 150,000 barrel per day (bpd) line. Over the years its throughput has been increased to 300,000 bpd, with no upgrade of the pipe itself in our area. (With the twinning, throughput of the old pipe was to be increased yet again, to 350,000 bpd.) The threshold of detection for leaks is, according to Kinder Morgan, in the range of 2 to 5% of pipeline flow. 5% would be 99,375 litres per hour that could leak undetected.

One of the very troubling components of the diluted bitmen shipped from Alberta through that pipeline is benzene — water soluble, toxic, carcinogenic, mutagenic — which may be present in concentrations up to at least 0.7% according to industry documents we’ve seen. 0.7% of 99,375 litres per hour is 696 litres per hour of benzene that could be released.

The Canadian limit for benzene in drinking water is 0.005 ppm. An undetected 5% leak from the old pipe into our “protected” groundwater zone or upstream of Yarrow Waterworks wells could contaminate 139,200,000,000 litres of water per hour to the drinking water limit of 0.005 ppm!

Of course that wouldn’t really happen. There wouldn’t be that much water to contaminate.

“Do not operate school buses, or any vehicles, mechanical equipment, cellular phones, electronic devices or any item that could create a spark near a suspected release.”

Kinder Morgan Canada, “Pipeline Emergency Response Guidelines for Schools” (pdf)

At the Kalamazoo spill in Michigan, 320 people reported symptoms of benzene exposure from the air, with readings as high as 3,000 ppb benzene. Benzene is also volatile, with the potential for fire or explosion. Were a significant leak to happen in the residential areas where the pipeline runs as little as 8 metres from homes, people and pets would certainly be affected, and ignition could occur from sources such as appliance pilot lights or backyard barbeques.

A diluted bitumen spill in our community could be disastrous for all of us, our homes, businesses, schools and hospital.

The old pipeline has had hundreds of repairs in more remote areas in recent years, but only a few in inhabited areas. At time of writing there is a location in Yarrow where the company knew the pipeline was exposed since 2010 but they never reported it to the NEB until now. 2010 regulations did not require them to report it, and when they filed an Operations and Maintenance notice for the repair work on this one they told the NEB that they do not intend to report other “historical” exposures either.

There is little doubt that repairs are needed or will be before long where the pipeline runs through residential areas, wooded areas, and under streams in our community. Those repairs will be difficult and costly, particularly in the residential neighbourhoods, due to difficulty accessing them.

So, with our own government now owning the pipeline, we will be pushing for the old pipeline to be replaced instead of just putting bandaids on to keep it running in locations where spill impacts would be worst. A new segment of pipe alongside Highway 1 would pose little or no danger to schools and residential areas, and no danger to community drinking water sources or areas of exceptional ecological value such as Peach CreekBrowne Creek Wetlands, and the Heron Reserve.

Secondly, the Expansion Project may rise from the dead to add 590,000 barrels per day additional risk to our community, 50,000 barrels per day of that going through the old pipe. If the expansion does return, and if whatever process it returns with has any integrity, we will once again find ourselves faced with detailed route hearings.

In case the existing pipeline is not being relocated by that time, we’ll continue from experience gained to date and Kinder Morgan’s written evidence filed just before the project stopped, to prepare the best case we can for those detailed route hearings. Those preparations can be tucked away and updated until and unless we receive some proof that the Project is really gone for good.

Meanwhile, it is very exciting after nearly 6 years on this file and the very intense focus of the past 2 years, to finally be able to engage more fully on other priorities! In particular we’ll be turning more attention to our streamkeeping program, and returning to BC’s Water Sustainability Act (WSA).

On the WSA file, an issue became apparent when Kinder Morgan put snow fence into seven streams to block spawning. They claimed that they can do that without having to ask any level of government’s permission or forgiveness.

After considerable public pressure the Oil and Gas Commission finally fined Kinder Morgan a whopping $230 for one of those installations. But why only one? The only difference we’re aware of was that the one installation used rebar in addition to rocks to hold the snow fence in place. The absence of any consequence for the other six seems to support Kinder Morgan’s assertion of being able to block spawning wherever and whenever they want without having to justify it or be accountable for it to anyone, so long as they don’t use rebar it seems. And of course if they can do it so can anyone else. With wild salmon struggling and that affecting everything that relies on wild salmon — such as the endangered orcas that were part of why the pipeline approval was quashed — this gaping hole in our environmental protections cannot be allowed to remain.

Of course along with the hard issues we’ll be looking for fun ways to help people experience and appreciate the physical, spiritual, cultural and ecological wealth that is in our shared home waters!