Imperial Metals, the owner of the Mount Polley and Red Chris copper-gold mines in British Columbia, is “totally on the brink” of bankruptcy according to a mining accounting expert.

“They’re not even close to making money,” Thomas Schneider, an expert on financial reporting of environmental liabilities and assistant professor of accounting at Ryerson University, told The Narwhal. “It’s just a matter of ‘can this company make enough cash flow.’ And they’re just coming off a strike.”

“This company is on the brink,” he added. “There’s no two ways about it.”

Imperial’s share price was at press time $1.33, down from over $18 per share in early 2014.

The company is currently surviving on debt, paying $75 million per year in interest expense. Interest payments are being made by issuing shares to creditors rather than cash — yet another bad sign. Recently, Imperial issued 3.1 million shares valued at $1.97 each to pay off interest of $6.1 million. But shares are now $1.33, meaning that similar attempts may require the issuing of even more shares to pay interest, which could lead to dilution and an even lower share price.

Schneider said that it “looks to me like a downward spiral.”

The company’s latest quarterly financial statement reported a net loss of $36.6 million. These losses were blamed primarily on the recent two-month strike at Mount Polley and lower-than-expected recovery at Red Chris, exacerbating an already weak financial position from a few years of low copper prices and the sizable impacts of the tailings disaster.

Copper prices have continued to decline since the start of the trade war between the United States and China in early July.

The big date that Schneider said to watch is October 1: by then, the company needs to have re-negotiated a $200-million credit facility — a type of loan from investors — some $44.1 million of which is currently used to secure letters of credit for reclamation costs at its mines.

If the group of creditors decide to walk away rather than continue finance the struggling company, Schneider said Imperial Metals will suddenly face massive unfunded reclamation costs.

In a recent conference call with investors and analysts, Imperial’s chief financial officer said: “We are in discussions with our lenders and continue to work on financing alternatives and solutions for this debt.”

Imperial Metals did not respond to multiple requests for comment.

‘Holy cow, what are we financing?’

A spokesperson for the B.C. ministry of energy, mines and petroleum resources said in an e-mail that the province’s chief inspector of mines can demand payment in full in the case of a non-renewal of letters of credit.

The company’s reclamation costs are now estimated at $100.9 million with only $14.3 million secured in cash. Schneider said that an immediate requirement to secure the remaining amount would “for sure trigger bankruptcy.”

The figure of $100.9 million is the result of a “discount rate” that estimates the present value of future liabilities based on anticipated rate of return of investments. The higher the discount rate due to perceived risk, the less that has to be set aside today.

According to Imperial Metals, the full “undiscounted” cost of its environmental liabilities is $173.6 million.

“When are the creditors going to say ‘holy cow, what are we financing?’ We’re financing the B.C. government not to have to do the clean up, so why don’t we just walk away and let the government do the clean up?’ ” Schneider said.

The company’s second quarter report for 2018 indicated that it was planning to pay for $28.4 million of the $100.9 million in future site reclamation provisions in “mineral property, plant and equipment.”

The company may be required to cover that amount in cash, which would likely require them to take on even more debt. Another $14.3 million is held as reclamation deposits, up from $4.7 million in 2016.

An estimated $86.3 million in reclamation costs are expected to be paid between 2018 and 2046, leaving about $14.7 million after 2046. Schneider said the undiscounted liabilities after 2046 may be around $100 million.

“How many equity investors care about a liability that the company has to pay in 2046?” Schneider said.

“Who really cares about it? We do. The government does. The people do. At the end of the day the equity investors don’t give a damn, and the longer you can put this stuff out the better it for the equity investors and the worse it is for the general public.”

‘The whole clean up thing is a real misnomer’

It’s unclear if that figure of $100.9 million is even enough to pay for future costs.

Imperial Metals acknowledged as much in its latest annual report: “The actual costs of reclamation set out in mine plans are estimates only and may not represent the actual amounts that will be required to complete all reclamation activity. If actual costs are significantly higher than our estimates, then our results from operations and financial position could be materially adversely affected.”

For many, the Mount Polley mine is the most immediate concern when it comes to clean up. The 2014 tailings breach released 25 billion litres of waste into nearby waterways and forests.

In 2017, Imperial Metals estimated a total of $67.4 million had been spent in clean-up costs for the Mount Polley spill. Of that, $15.5 million has been paid directly by government departments, with another $23.6 million eligible for tax refunds.

A field of debris and dried sediment at the mouth of what was Hazeltine Creek one week after the collapse of the Mount Polley tailings pond. Photo: Farhan Umedaly, Vovo Productions

The company increased its rehabilitation provision for the Mount Polley mine by $5.8 million in 2017. Schneider said that amount is the company’s best estimate of what is required to finish cleaning up Mount Polley, with $3.6 million of it being spent in 2018.

But local residents said in interviews with The Narwhal that the catastrophe is far from over.

“The whole clean up thing is a real misnomer,” said Jacinda Mack, co-founder of Stand for Water and member of the Xatśūll (Soda Creek) First Nation. “All they did was re-engineer. Everything is still in Quesnel Lake, Polley Lake, in the forest. And they say it would be more disruptive to try to remove the tailings. But if those tailings were filled with gold, they would find a way to remove those tailings.”

“Communities have received zero compensation,” Nikki Skuce, project director of Northern Confluence, said. “There’s been no fines or charges. Reclamation isn’t done. We don’t know what the long term impacts are on salmon and the water of Quesnel Lake.”

Douglas Watt, a retired metallurgist and member of the Mount Polley Mining Corporation’s public liaison committee, said it could take up to 1,000 years for the “totally devastated” Hazeltine Creek to return to what it used to be. The biggest concern for local residents, he said, is that Mount Polley received a permit in April 2017 to discharge effluent into Quesnel Lake until the end of 2022.

Watt said that immediately after the mine received the permit, the publicly announced life of the mine went up by another four years, to 2026. He said that within a few months of receiving the permit, the mine was already out of compliance with some of the permit’s conditions — and that it’s still out of compliance to this day.

“Our biggest fear is that they’re going to now ask the ministry for a permit amendment to continue to discharge their effluent beyond 2022,” said Watt, who worked for Imperial Metals in the late 1980s. “I’m pretty sure they’re probably working on that now.”

On August 15, it was announced that the B.C. Environmental Appeal Board will hear an appeal of the permit from a member of Concerned Citizens of Quesnel Lake at the end of January 2019.

Jacinda Mack in Victoria to speak with MLAs about mining reform in B.C. Photo: Taylor Roades / The Narwhal

Multiple lawsuits against Imperial Metals quashed by courts

Multiple lawsuits have been filed against the company for the spill, but all have been quashed.

Time has run out for criminal charges to be pressed in B.C. However, federal charges can still be laid sometime in the next year.

In 2017, Bev Sellars — the former chief of Xatśūll First Nation — filed a private prosecution against the company, but the B.C. Crown Prosecution Service halted the case after it concluded there wasn’t a high enough chance of conviction.

Ugo Lapointe of MiningWatch Canada also launched a federal private prosecution for alleged contravention of the Fisheries Act, but that was similarly stayed before he had the chance to present evidence in a court hearing.

“We’re concerned with not only the clean-up of the spill but the actual closure of the mine site and the clean up of the whole mine site,” Lapointe said in an interview with The Narwhal.

“You’re now dealing with a company that is not super financially viable, and it’s an increased risk for the public.”

A recent economic analysis by the Ecofiscal Commission found mines in B.C. often operate without adequate reclamation bonds and assurances, creating a major liability for the province’s taxpayers.

Majority owner of Imperial Metals donated more than $850,000 to BC Liberals

Imperial Metals’ majority owner, N. Murray Edwards, currently boasts a net worth of $2.9 billion, making him one of the wealthiest Canadians.

Companies owned by Edwards have historically been major donors to the BC Liberals, who governed the province for 16 years until one year ago.

Dermod Travis, executive director of IntegrityBC, wrote in an e-mail that total donations to the Liberals by companies owned or controlled by Murray Edwards total more than $850,000 since 2005.

That includes $199,180 from oilsands giant Canadian Natural Resources Ltd., $179,440 from Imperial Metals, $99,500 from Horizon Construction Management and $90,000 from CNR ECHO Resources.

In 2013, Edwards helped organize a million-dollar fundraiser for former premier Christy Clark’s re-election.

In 2004, an order in council forgave $2.9 million owed to the B.C. government by Huckleberry Mines, of which Imperial Metals then owned 50 per cent.

In 2017, then-interim leader of the federal Conservatives Rona Ambrose vacationed with Edwards for close to two weeks in the Caribbean.

Environmental liabilities may be underestimated

There’s also the strange situation of Imperial’s Huckleberry Mine, a copper mine that closed operations in late 2016 but may reopen in 2019 if copper prices increase.

Until April 2017, a syndicate of Japanese companies owned the other half of Huckleberry, but Imperial took it over after the syndicate couldn’t pay $77 million that it owed to the project. It was primarily because of that acquisition that the company declared a net profit in 2017. That followed consecutive years of significant losses, including losses of $96 million in 2015 and $54 million in 2016.

But Schneider said that it appears the estimated $22-million future reclamation liabilities for Huckleberry was improperly reported in the annual report, potentially requiring a reissuing of the financial documents.

The possible misreporting had to do with the “discount rate” used in reporting reclamation costs.. Schneider said Imperial Metals should have used a “risk free” discount rate of 3.2 per cent on reclamation liabilities at Huckleberry — but instead used a “credit risk adjusted interest rate” of 6.3 per cent.

That choice lowered the reported present cost of the liability. Schneider said it could end up as a difference of $20 to $30 million than if the company had used a “risk free” rate (let alone undiscounted rate).

In the end, the Huckleberry reclamation could end up costing as much as $100 million. The mine has an identified potential for acid rock drainage, which if triggered can result in significant impacts on ecosystems and wildlife.

Schneider said that Imperial Metals should potentially have to restate its financial figures, preferably providing an undiscounted amount. That would give investors and the public a far better idea of what the real costs might be.

Deloitte, which audited the company’s financial statements, refused to answer a question about the discount rate, writing: “Our policies and our code of professional conduct prohibit us from discussing any information about clients or the work that we do for them.”

The manager of investor and industry education at the British Columbia Securities Commission also said in an e-mail that “we do not comment about specific companies or market participants.”

Imperial Metals could still be rescued

It’s not known if Imperial Metals will end up declaring bankruptcy.

The creditors may renew the $200 million credit facility in October, hopeful for improved cash flows from the mining operations. Schneider said that creditors may not want to take the assets over given the company’s very high debt-to-equity ratio.

“Maybe things are in place and all will be fine — we shall see,” Schneider said.

Or Edwards or the companies he controls — which currently own 40 per cent of the company and more than $200 million of Imperial’s debt — could come to the rescue.

Lapointe of MiningWatch Canada said Imperial Metals has “pulled similar financial stunts” before, and that Edwards or affiliates will often bail companies out.

Sustained lobbying efforts could also help.

“The companies that are in bad financial situations like this for a number of years tend to lobby the government even more and try to leverage any kind of political support they can get to then get any possible subsidies or tax breaks or lower securities,” Lapointe said.

In 2016, the B.C. government introduced a deferred payment program for up to three-quarters of monthly electricity billing depending on the price of commodities.

At the end of June, Imperial Metals owed $73.5 million to the utility company. Of that, $51.4 million is to partially reimburse BC Hydro for the cost of building the controversial $736 million Northwest Transmission Line, with the remaining $22.1 million for deferred electricity costs.

But Lapointe said that if Imperial Metals does end up collapsing, another company could come along, strip it of valuable assets and leave clean-up for governments.

“Even by clearing the debt away by folding it into bankruptcy, the projects may be so marginal and high cost that the new company will be able to run the mine again for four or five years and then call it off again,” he said.

‘It’s a very tense relationship’

It didn’t have to happen like this.

Skuce said that the mining rules in Alaska and Quebec require full payment within two or three years of a mine opening, which limits public liability and dissuades high-risk projects from proceeding.

Lapointe said that Quebec’s new measures, introduced in 2013, require half of securities to be paid during the permitting process and the other half during the first two years of operation.

“Typically, the more financially risky a project or company is, the more risky it is for the environment and communities,” he said. “It’s pretty simple logic: they’re scrambling to survive. They’ll prioritize the money to survive, which is the operations and revenues. And they’ll often cut corners on everything else, including putting in place the best technologies or environmental practices or best design because they cost more money.”

Meanwhile, Mack said her community isn’t receiving regular updates from the company, and are instead instructed to check its website. But things aren’t up to date, she said, and information is often only available for a short period of time before it’s removed. As a result, she said that community meetings have dwindled from 150 people shortly after the disaster to only a handful of dedicated members.

“I would say it’s a very tense relationship,” she said. “A lot of people have stopped attending meetings out of frustration and anger.”

The Narwhal’s reporters are telling environment stories you won’t read about anywhere else. Stay in the loop by signing up for our free weekly dose of independent journalism.

This piece originally appeared on the Canadian Centre for Policy Alternatives.

There is no question that the new B.C. government’s decision to proceed with the Site C dam was a very difficult one. The previous government left them with a poison pill.

With $2 billion already spent, the Horgan government faced a no-win choice, with substantial political and economic costs for either terminating or proceeding with what is one of the largest and most expensive capital projects in B.C. history.

I don’t envy them.

But count me among those who believe the wrong decision was made.

In a difficult decision like this one, it matters who gets listened to, whose expertise wields authority and what considerations win the day. That’s why unpacking this decision matters — so we can consider how progressives might shake up the framework by which future decisions are made.

First things first, this decision does deep harm to the prospects for reconciliation with Indigenous people. It is fundamentally at odds with the government’s stated commitment — affirmed in the NDP-Green Agreement and in the mandate letters of each Minister — to implement the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP).

Fundamental to UNDRIP is the duty to secure consent before engaging in major projects that impact the land and title of First Nations people. Achieving that consent should be embedded in our decision-making process. And yet in this case it is absent.

For thousands of people who strongly oppose Site C for both environmental and Indigenous rights reasons, this decision feels like a political betrayal — and will for many years. And with every likely new announcement of a cost overrun in the years to come, more salt will be ground into the wound.

The CCPA’s Marc Lee, in his submission last summer to the B.C. Utilities Commission, outlined why he felt the electricity Site C will provide is not needed. Indeed, our contention for many years has been that what was truly driving the push for Site C was the natural gas industry’s demand for electricity — both for fracking operations and, down the road, to electrify the process of liquefying that gas. Meaning it was primarily about producing “clean” energy in service of dirty fossil fuels, and it still might be.

In the final years of the Clark government, the push to take Site C “past the point of no return” was, I believe, driven by a different but related political imperative.

Having failed to secure foreign investment for a new LNG industry (and the associated promise of thousands of jobs for B.C.’s northern regions), Premier Clark, ironically, beat a path back to the public sector and looked to BC Hydro to deliver those jobs through construction of the Site C dam.

“In a difficult decision like this one, it matters who gets listened to, whose expertise wields authority and what considerations win the day. That’s why unpacking this decision matters.” via @SethDKlein and @CCPA_BC https://t.co/UFcqbxEui2

— DeSmog Canada (@DeSmogCanada) January 18, 2018

Economic rationale doesn’t hold water

Notably, when Premier Horgan made the announcement that the government would proceed with Site C he appeared decidedly unenthusiastic. Make that downright miserable. He made clear that Site C was, at its outset, a wrong-headed policy choice, and not a project his government would have started. But with $2 billion spent and reclamation costs of termination pegged at $1–2 billion more (likely the low end), the Premier felt his government had “no choice” but to proceed.

Granted, the prospect of spending $3–4 billion and having nothing to show for it hurts.

But the government went further, stating that absorbing such a bill would put its progressive economic and social agenda at risk. Some ministers expressed the view that termination costs would threaten B.C.’s Triple-A credit rating and would consequently drive up our debt service costs.

Minister Mungall, in an email sent to those who wrote to her about Site C, stated, “To do anything but move forward would require British Columbians to take on $4 billion in debt that would have to result in massive cuts to the services people count on us to deliver. After witnessing the legacy of BC Liberal cuts, I can’t allow that to happen again” (emphasis mine).

This line of argument may sound compelling. But on closer inspection, it is not at all convincing.

Had the costs of termination remained on BC Hydro’s books, this would indeed have resulted in an increase in Hydro rates, but not to the degree stated by the government. And proceeding with Site C will also result in increases in Hydro rates down the road (quite possibly more so).

Given that the decision to green-light Site C was politically driven by the previous government, my view is that the costs of terminating the project should not have been borne by BC Hydro, but rather by the provincial government as whole (as it seems the government considered).

Some may say this makes no difference — taxpayers and ratepayers are one and the same after all. But it does make a difference. As the CCPA has noted in past research, Hydro rates are regressive — they impact lower-income households harder than upper-income ones. In contrast, provincial government debt is serviced from overall taxes, which are mildly progressive now that the new government has brought in an upper-income tax bracket and is phasing out MSP premiums. With further fair tax reform, the costs would be even more fairly distributed.

Relieving BC Hydro of the costs of termination could have been done by either transferring the Site C sunk costs and termination costs onto the provincial government’s debt or, if the government did not want to assume the $3–4 billion debt from BC Hydro, it could simply have agreed to annually transfer the interest costs of that debt to BC Hydro (as restitution for this politically imposed cost).

Four billion dollars in debt would result in additional interest costs of at most $150 million a year. That’s not insignificant. But neither is it enough to derail a government’s agenda: it is 0.3 per cent of the province’s $50 billion annual budget.

Would taking on $3–4 billion in termination debt, with no asset to show for it, squeeze out the rest of the government’s agenda and potentially erode B.C.’s credit rating with the consequence of driving up debt interest costs? This seems highly unlikely.

At today’s interest rates, $4 billion in debt would result in additional interest costs of at most $150 million a year. That’s not insignificant. But neither is it enough to derail a government’s agenda. $150 million is less than the current surplus. And for context: it is 0.3 per cent of the province’s $50 billion annual budget.

In contrast, consider that in the September 2017 Mini-Budget, the new government cut MSP premiums by 50 per cent and chose not to replace those revenues with progressive tax increases (as the CCPA has previously recommended). In doing so, the government chose to walk away from $1.2 billion in annual revenues — a much more costly decision it did not feel put the rest of its agenda at risk.

Similarly, as Green Party leader Andrew Weaver has noted, the government chose to cancel tolls on the Port Mann Bridge and take on that debt at a price of $3.5 billion (and annual costs of replacing the toll revenues of about $150 million), but expressed little concern about the impact this would have on the affordability of B.C.’s debt.

The September Mini-Budget estimated that taking on the Port Mann Bridge debt would increase B.C.’s debt-to-GDP ratio (the size of the provincial debt compared to the size of the economy) by about 1.2 percentage points. The cost of terminating Site C would have been similar in debt-to-GDP terms — an impact that is entirely manageable in economic terms and well within B.C.’s recent debt levels.

Would taking on this debt have resulted in a downgrade to B.C.’s credit rating?

Possibly, but not necessarily. B.C.’s fiscal situation would have remained enviable (with respect to both debt-to-GDP and debt service costs relative to other provinces). It is arguably also possible that credit rating agencies would have given kudos for termination, seeing it as an expression of fiscal caution that avoided further potential multi-billion dollar cost over-runs (as is common with such mega-projects), particularly given the fact the credit agencies and B.C.’s Auditor General have already expressed concerns about BC Hydro’s debt load.

Even with a downgrade (if it occurred), would B.C. face significantly higher interest costs?

Again, while there is frequently fear-mongering about this outcome, this result should not be assumed — bond markets don’t respond slavishly to credit rating agency assessments. And if there was a credit market response to a downgrade, it would have been minimal.

Canadian provincial credit ratings vary from B.C.’s Triple-A high to PEI’s Single-A low. But as economists Trevor Tombe and Blake Shaffer note, the practical significance of this difference is that long-term provincial bond interest varies from 3.1 per cent in B.C. to 3.5 per cent in the Atlantic provinces. They note further that, “On average, each notch on the S&P ratings scale is associated with 0.04 per cent higher yield on a 25-year bond.”

In other words, not much.

Letting others call the tune

Numerous NDP MLAs have offered public explanations of the decision to proceed, all stating some variant of: we referred the BCUC’s report for further analysis to financial experts, and with great regret, were told that, while the actual costs of termination versus completion were similar, the accounting treatment of the choices would be very different.

Effectively, the government has said that accounting practices — as interpreted by finance ministry officials — trumped good policy and UNDRIP.

The problem, I fear, is that the full scope of options gets lost at the Cabinet table. If one’s deputy minister, for example, sounds the debt and/or credit rating alarm, few politicians feel comfortable pushing back. Or if the government is spooked by a credit rating agency warning — Finance Minister Carole James did go visit the rating agencies early in the new government’s mandate — there is political fear of a downgrade.

It is a curse of modern social democratic governments that, on economic matters especially, they are inclined to let others tell them what is and isn’t allowed. This dynamic plagues otherwise progressive people who lack confidence in economics, and it is heightened when senior civil servants remain in place after a change of government — the same people giving the same advice as always.

It is a curse of modern social democratic governments that, on economic matters especially, they are inclined to let others tell them what is and isn’t allowed.

Another way was possible. The government could and should have taken on the costs of termination (realistically a figure closer to $3 billion). It could have taken on other energy conservation and renewable electricity projects over the coming years (wind, solar, geothermal, etc.) as needed and in partnership with local First Nations and the building trades.

In doing so, it could have created just as many jobs as Site C will provide, but more helpfully spread across the province and closer to where people actually live, rather than concentrated in one locale (which will mean having to import much of the labour). Indeed, this is exactly what the NDP proposed in its 2015 Power B.C. plan.

Sadly, that plan was short-lived. A lost opportunity to move forward with far less of a price and much more to gain.

What now?

In the end (and official explanations notwithstanding), Site C was clearly a political decision — not an economic one. Only time will tell if that political decision was strategically correct or a costly mistake.

The government made a calculation (affirmed by recent polls) that the majority of the public would support continuation. They likely worried about the reaction of mainstream media pundits and the corporate sector had they chosen termination.

But the economic and political costs of proceeding with Site C will haunt the government throughout its mandate and beyond.

It seems at this point that the prospects of an about-face are highly unlikely. So why bother rehashing the decision?

First, it is important that unconvincing economic justifications — and the fear-mongering of credit rating downgrades — be challenged, otherwise the precedent is set for more disheartening decisions down the road.

Second, understanding this decision matters so that the new government can be encouraged to approach future ones differently. Much progress is clearly still needed to truly implement and operationalize UNDRIP in B.C. policy-making. And this is an opportunity to change the frame, to shift whose expertise wields authority and to reconsider what priorities win out.

In the last election British Columbian voted for change. Rather than deferring to the same accountants and ministry officials, this still new-ish government can continue to bring in new voices, invite more creative solutions and engage more fully with civil society.

The Narwhal’s reporters are telling environment stories you won’t read about anywhere else. Stay in the loop by signing up for our free weekly dose of independent journalism.

For years, Nexen's Aurora project envisioned transforming Digby island near Prince Rupert into a sprawling $20 billion LNG plant shipping 24 million tonnes of liquified B.C. natural gas to Asia. 

On September 14, Aurora officially backed out, reinforcing the words written in this year’s NDP election platform.  “[Ex-premier Christy Clark] bet everything on natural gas prices and left the rest of B.C.’s economy without support,” it reads.  “Resource communities and families have paid the price. That’s got to change.”

But change to what?  With the rise of B.C.’s new NDP government, forged with the support of the B.C. Greens under climate scientist Andrew Weaver, there is now an opportunity to reset and find more realistic ways to tap the wealth of natural gas in the Peace region. 

“The idea that there is going to be a big mega project like Petronas [Pacific NorthWest LNG] was nothing but a pipe dream,” says Andrew Weaver.  “The real question is, what are we going to do with the resource?"

Where We’re At Now

There are three B.C. LNG projects worth noting these days: Woodfibre, a small project near Squamish, Tilbury, a recently-expanded LNG facility in Delta operated by FortisBC, and LNG Canada, a big project at Kitimat led by Shell, which continues to delay a final investment decision.

For the short term the economics of new LNG are nonexistent, but in the medium term, things could improve: Bloomberg New Energy Finance’s latest global LNG outlook points to a current oversupply, with supply and demand projected to match again around 2024. After that, new supply could be needed.

When and if the that time comes, the NDP has issued four vague conditions that new projects will have to meet. Proposals must provide a fair return for the resource, include local job guarantees and training, First Nations partnerships, and protection for the environment — including “living up to our climate commitments.”

The B.C. Ministry of Energy, Mines and Petroleum Resources refused interview requests and would not provide additional information about the conditions — or other key aspects of NDP election promises pertaining to natural gas.

And as for Christy Clark’s Prosperity Fund from LNG windfalls which was projected to eventually hold $100 billion, the NDP during the election promised to drain the fund and use it to fund the cutting of two Lower Mainland bridge tolls.

A Pending Scientific Review of Fracking?

The amount of natural gas extracted in B.C. continues to go up — in spite of current low gas prices and the short-term death of LNG.

Today this growing production reaches three primary markets: Alberta, where much of it is used to create steam for in situ bitumen mining in the oilsands; the U.S., where some is shipped as LNG out of Louisiana, and finally, for domestic use in British Columbia.

Virtually all current (and future) production will involve hydraulic fracking — an energy-intensive process where enormous quantities of water, sand and chemicals are forced under high pressure into horizontal wells to release natural gas trapped in the rock.

Back during the election campaign, the NDP promised to conduct a scientific review of fracking. The province did not provide details about the review for this story, but Ben Parfitt, a Canadian Centre for Policy Alternatives resource policy analyst — who has documented the use of illegal dams by the gas industry to provide water for fracking — says such a review is warranted. 

Parfitt points to an August 2015 incident where a B.C. fracking site operated by Progress Energy is believed to have triggered a 4.6 magnitude earthquake — among the biggest earthquakes by a natural gas industry drilling-fracking operation anywhere, ever. Progress’ own data later showed that this operation used about eight times the volume of water used in a typical U.S. fracking operation.

“If we ever saw a major LNG facility open on our coast, then the level of drilling and fracking would increase by a very significant factor. The water demand would go up exponentially,” Parfitt said.

Weaver Says Manage Cumulative Impacts

It’s relevant that the annual meeting of the Union of B.C. Municipalities this week will include a vote on a B.C. moratorium on fracking. B.C. Green Party leader Andrew Weaver doesn’t favour this approach, but says we need to find a way to manage the “cumulative impacts” of our current “wild west” approach to resource extraction. “Nobody is saying ‘stop producing natural gas,’ but under the Liberals it was a get-to-yes approach.”

To that end the Greens have proposed creating a natural resources board that could oversee and manage the many cumulative impacts of resource development.  He points to the “patchwork” approach to protecting caribou as an example of the current dysfunction.

“We have roads going in here, forestry there, mining here and natural gas there.  There is no overarching look at how we can develop our resources in a manner that is sustainable in the long term,” Weaver said.

 “That’s what we are looking for.”

Natural Gas for Domestic “Fuel Switching”

A bright spot for B.C. natural gas, says Tyler Bryant of FortisBC, is to use it in B.C. to substitute the use of marine diesel and heavy fuel oil in ferries and ships, and diesel in transport trucks. 

FortisBC recently expanded its Tilbury LNG facility at Delta — which today supplies fuel for five passenger ferries operated by B.C. Ferries and two cargo ferries for Seaspan. Since 2011, it has provided incentives to convert more than 700 natural gas vehicles in B.C. — which the company says has saved 135,000 tonnes of CO2 and $20 million in fuel costs to date.

New Government BC’s Natural Gas: What Changes are Coming Down the Pipe? https://t.co/tVvuBVbPwI #bcpoli #climate #LNG #natgas #fracking

— DeSmog Canada (@DeSmogCanada) September 26, 2017

Tyler says natural gas makes it possible to address difficult to “decarbonize” sectors like shipping and trucking — and allows us to use a B.C. resource that has lower C02 emissions. To critics who want cleaner alternatives sooner, he says natural gas can be viewed as a bridge.

“We have an option to reduce GHGs and local air pollution right now with natural gas. And in 10 years time when you have to replace the vehicles, if other technologies are available, then we can explore those options.”

Raising the Carbon Tax — Which Will Promote Using B.C. Gas

On the day I talk with Andrew Weaver about natural gas, he’s on speakerphone driving a broken microwave to a Victoria-area recycling depot. 

“Government has a role to play in this,” he says of substituting natural gas for dirtier fuels.  He is cut short when a transport truck passes and blasts him with fumes. “If that guy had been using compressed natural gas instead of diesel, that wouldn’t have happened,” he laughs.

Weaver says fuel switching using natural gas to displace emissions from ships and trucks is an opportunity we need to capitalize on in B.C.   

One way to get there, he adds, is by pricing emissions via the newly invigorated B.C. carbon tax — which will be rising from the current $30 to $50 tonne by 2021.

By making it more expensive to operate higher-polluting vehicles, Weaver says the tax has the power to drive society to lower-emitting transportation.

In the deliberations between Greens and the NDP, Weaver says it was vital to give B.C. industry “certainty” around how the carbon tax would be increased — so they pushed for the price to increase by $5/year staring in 2018, and will reach Canada’s national target (of $50/tonne) by 2021 — a year ahead of the national schedule.

Quantifying, Capturing ‘Fugitive Emissions’ Still a Challenge

The newly strengthened carbon tax will also force the gas-patch to clean up a lot of emissions it has not had to pay for — up to now.

In the MOU signed between the Greens and NDP, a commitment was also made to broaden the carbon tax to capture so-called “fugitive” emissions — a catch-all phrase for CO2 and methane emissions that occur during gas extraction and processing. 

Maximilian Kniewasser, Program Director of B.C. Climate Policy at the Pembina Institute, says such emissions occur when industry vents CO2 that is extracted with natural gas, as well as from methane escaping from pumps and controls in processing plants and pipelines. There are also the leaks that occur among many moving parts working under pressure.

Capturing these emissions dovetails with Canada’s commitment to reduce emissions by 45 per cent from oil and gas by 2025, says Kniewasser. 

The hard part, he concedes, will be to agree on a way to quantify the amounts of “fugitive” gases escaping into the atmosphere.

Curtailing fugitive emissions is one important part of making domestic use of natural gas feasible from a climate perspective but, according to Weaver, the world is on a transition path away from fossil fuel use.

“We are in the middle of an energy revolution like we’ve never seen before,” Weaver said. “To think that, somehow, we are going to continue to produce energy the way we were is a bit of a myth.”

Image: Natural gas operations. Photo: Province of B.C. via Flickr

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By Andrew MacLeod for The Tyee.

For two years leading up to the May election, the government of British Columbia regularly broke its own law for responding to freedom of information requests, a report from the province’s information and privacy commissioner found.

“Overall, I am frustrated to see that government routinely operates in contravention of B.C. law,” acting commissioner Drew McArthur wrote in Timing is Everything: Report Card on Government's Access to Information Responses.

The report examined responses made during the two-year period that ended March 31. It found that in one out of five cases, the government failed to meet the deadlines for responding that are legislated in the Freedom of Information and Protection of Privacy Act.

Freedom of Information Seriously Suffered Under BC Liberals' Last Years: Report https://t.co/TmiI876FVz #cdnfoi #bcpoli @bcliberals

— DeSmog Canada (@DeSmogCanada) September 25, 2017

“I cannot consider an 80 per cent success rate to be satisfactory,” McArthur wrote. “The government needs to accelerate its recent progress in improving timeliness toward the goal of total compliance.”

The poor response rate was despite a 75 per cent increase in the number of requests made to his office for extensions, he said. “Time extensions under FIPPA are intended to be the exception rather than the norm, as each extension delays providing results to the applicant. Ministers need to prioritize responses to access to information requests.”

The law requires responses within 30 business days, though it allows public bodies to request extensions in some circumstances. In 2016-17, the report said, the government completed responses to 9,857 access to information requests. On average, it took 46 days to respond to requests, and those that were late were past due by an average of 62 days, it said.

“Government continues to contravene its statutory obligations,” the report said. “The results also show a decline in government’s performance from earlier this decade when the on-time response rate hovered around 90 per cent for over [four] years.”

Recommendations included proactively disclosing more records, providing more resources to close overdue files and that “Government must take whatever action necessary to respond to access requests within the timelines allowed by FIPPA.”

“We’ll be looking at the recommendations and of course we take them very seriously,” said Jinny Sims, the minister of citizens’ services.

“For 16 long years, under the BC Liberals, we saw government becoming more opaque, a government of triple deletes and a government of win at all costs,” Sims said.

The government, which took office on July 18, has begun consultation on the issue, but won’t rush the review of a law that applies to some 2,800 organizations, she said. “We want to make sure we get this right so that British Columbians can have a government that’s open, transparent, accountable and they get the information in a timely manner, while at the same time balancing the absolute necessity to protect privacy.”

Sims said the compliance rate has risen to 91 per cent since the NDP took office. “That’s a huge progress that’s been made in this very short time,” she said, attributing the improvement to: “Having targets, having people focused, and maybe people seeing there’s a change in government and there is a need to expedite things.”

In an emailed statement, BC Liberal citizens’ services critic Steve Thomson said the “report shows some progress made in improving response times but is also clear that more work needs to be done.”

Image: Former Premier Christy Clark during the 2017 swearing-in ceremony. That didn't last long. Photo: Province of B.C. via Flickr

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Documents released on Monday reveal that B.C.’s climate plan under the previous Liberal government was drafted by the oil and gas industry in a Calgary boardroom, just as the province’s new NDP government moves to ban corporate and union donations to B.C. political parties.

The documents speak to long-standing concerns over the influence of political donations in B.C.’s political process. B.C. has long been considered the ‘wild west’ of political cash for placing no limits on corporate, union or foreign donations.

“I think this is deeply corrosive to our democracy and it encourages cynicism about politics,” Max Cameron, political science professor and director of the Study of Democratic Institutions at the University of British Columbia, told DeSmog Canada.

The documents, released to Shannon Daub of the Canadian Centre for Policy Alternatives as part of her research with the Corporate Mapping Project, reveal that while the B.C. government under former premier Christy Clark hired a celebrated Climate Leadership Team and conducted public consultations, a parallel industry consultation process occurred behind closed doors in a boardroom of the Canadian Association of Petroleum Producers.

The BC Liberals have raked in cash from the fossil fuel industry, including more than $3.7 million from just the top 10 industry donors between 2008 and 2015.

Cameron said the documents, which include slides outlining industry working groups tasked with addressing carbon pricing and methane emissions, provide a much-needed glimpse into what exactly industry is paying for when making large donations to political parties.

“Reading these documents gives us some real insight into how it is that these kinds of donations can buy not just access to government but access to actually writing policy,” he said.

Clark’s Secret Consultations with Oil and Gas Donors Revealed As BC Introduces Big Money Ban #bcpoli @CCPA_BC https://t.co/nFjm9W8Vqx

— DeSmog Canada (@DeSmogCanada) September 18, 2017

Climate Leadership Team Unaware of Parallel Industry Consultations

B.C. handpicked a blue-ribbon team of 17 academic, business, environmental and First Nations stakeholders to form the Climate Leadership Team. That team made 32 official recommendations to the B.C. government, none of which were implemented in the province’s eventual Climate Action Plan.

Merran Smith, executive director of Clean Energy Canada, was a member of the team and said the fact that not a single recommendation was adopted “really says it all.”

Christy Clark’s government “allowed the oil and gas sector to write the climate plan for B.C. that is mostly status quo and has very little impact on B.C.’s growing climate pollution,” Smith told DeSmog Canada.

She added once the team made its recommendations to the government, their involvement in the crafting of the Climate Action Plan tapered off quickly.

“We had very few meetings with the B.C. government once the recommendations were created. It was clear that they actually had very little interest in doing anything with recommendations.”

Meanwhile, Christy Clark pointed to the recommendations at the UN Climate Summit in Paris as evidence of B.C.’s climate leadership.

Tzeporah Berman, a prominent environmental advocate in B.C. and member of the Climate Leadership Team said she had no idea B.C. was conducting parallel consultations with industry.

“I was shocked when I saw these documents,” Berman told DeSmog Canada.

“Consultation should be a transparent process and should be done with multiple stakeholders. These were secret meetings in Calgary where the oil and gas industry was rewriting B.C. policy. That's not consultation, it's corruption.”

Berman said the documents reveal an “unacceptable level of access and influence with the Liberal government.”

“They also help those of us from the leadership team understand how the climate plan that the Liberals put together really had no similarity to what the Liberals’ own climate team recommended,” she said.

The team worked hard for months to deliver a plan within a short timeframe and offered to meet with stakeholders to “problem solve any concerns” if that would help B.C. “ensure implementation” of the recommendations, Berman said.

But that offer was never taken up.

“From our end it was a bizarre process,” Berman said.

Fossil Fuel Companies Regularly ‘Craft’ Climate Plans

Laurie Adkin, professor of political science at the University of Alberta, said when it comes to government consultations with corporations, “secrecy is routine” and “transparency is the exception.”

“Even when governments reveal that they have met with representatives of private corporations, reporting on these meetings typically does not reveal which corporate representatives were in the room, or what their positions were,” Adkin told DeSmog Canada.

Adkin, who is a member of the Corporate Mapping Project, specializes in documenting corporate influence in politics and on university campuses.

Government consultation with industry is the status quo, Adkin said, while public consultation is meant to merely survey public opinion and “give the appearance that government has created meaningful opportunities for citizen input into policy decisions.”

“I do not believe that any climate change plan has been written, to date, in which the major fossil fuel corporations have not ‘directly crafted’ the plan,” Adkin said.

Adkin and Cameron agree the documents are reflective of “institutional corruption.”

“Corruption isn’t just quid pro quo of privately benefitting from your public office, it’s also a corruption of the institution, when the public purpose of the institution is undermined by private actors in a way that diminishes our trust in those institutions,” Cameron said.

“The goal of public policy is to serve the public’s interest, not to serve particular private interests.”

Leadership Team Hopeful Under New NDP Government

Berman said the oil and gas industry has too much political influence in Canada, but said she is hopeful the new B.C. government will “design policy to benefit the people and not just polluters.”

“I was very glad to see the carbon tax increase in the last budget,” Berman said.

“I think the next step is removing all the subsidies that the Liberal government handed out to the gas industry. We shouldn't be spending taxpayers dollars to help the fossil fuel industry expand in the climate era”

Berman said she also looks forward to the new government moving forward on the zero emissions vehicles targets and strengthening the clean fuel standard.

Smith said she is pleased the Climate Leadership Team had the opportunity to craft the recommendations when it did.

“The silver lining is that we still have a good, solid set of climate action recommendations sitting there, and we now have a Premier and government who is interested in taking climate action and building a clean growth economy for the twenty-first century.”

Image: Former premier Christy Clark at a Woodfibre LNG announcement. Photo: Province of B.C. via Flickr

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By Arie Ross for Dogwood.

Why did the BC Liberals prioritize a project that could harm local communities, the Fraser River and farmland?

On the 601 bus to my hometown of Tsawwassen, I watch as bulldozers uproot the evergreens adjacent to the farmland along Highway 99, making way for a costly ten lane bridge built in the interests of industry. I imagine dredgers forcing themselves on the river bed, scraping at the sediment and defiling the critical salmon habitat.

The colossal pet project of the BC Liberal party — the controversial $3.5 billion Massey Bridge forced upon unwilling municipalities — is just another reason why we need a corruption inquiry in B.C.

Why was this $3.5 billion project, which impacts the health of my family and my neighbours while bulldozing food producing farmland, so important to the BC Liberals? Massive donations from proponents and prospective contractors to their party could hold the answer.

While our new NDP government suggests we defer to the mayors of affected communities on the fate of this bridge — which would yield a resounding no — construction on the Massey tunnel replacement project has already begun. For residents of Delta and Richmond, it is an unwelcome hangover from the BC Liberal reign.

Experts question the usefulness and safety of this project. How is it meant to relieve congestion when it includes minimal plans for public transit? I shudder at the fact the municipalities and citizens affected asked for a comprehensive environmental review under the Canadian Environmental Assessment Act (CEAA), but the Trudeau government denied the request. Apparently residents south of the Fraser don’t deserve to know about the impacts a massive bridge would have on their health and safety.

And while those who make their home in Delta, like my family, face unknown risks from increased coal barges and LNG tankers, many companies will benefit from the removal of the Massey Tunnel.

Making Room for Tankers on the Fraser River

Unlike the tunnel, a new bridge would make room to dredge the Fraser River, allowing for larger ships to reach ports upriver and spur on further development for private gain.

Fraser Surrey Docks, the company still hoping to build a thermal coal export terminal on the Fraser River, would certainly benefit from a bridge. Maybe that is why they gave $14,575 to the provincial Liberal party while they were in control of the decision. They also lobbied the feds to have the tunnel removed so they can move full ocean-going vessels of coal down the river, past residential neighbourhoods, over fish habitat, and out to sea.

Another company with a massive stake in this bridge is Fraser River Pile and Dredge, who donated $24,876 to the BC Liberals. When the river needs to be dredged for the construction of the bridge after the tunnel is removed, this is the company for the job. They are the largest dredging company in the country and are already contracted by the Port of Vancouver to routinely clear out the Fraser.

FortisBC is looking to expand their fracked gas operations at the Tilbury LNG facility and bring more tankers up the Fraser. The removal of the tunnel would allow for larger, fuller supertankers to reach their facilities. They donated $186,024 to the BC Liberals and will spend $400 million on their expansion project in Delta.

The #MasseyBridge: A Boondoggle Bought by #BigMoney? https://t.co/h4okmfNTgA #bcpoli #corruptioninquiry @dogwoodbc

— DeSmog Canada (@DeSmogCanada) August 23, 2017

Bridge Bidders are Also Big Donors 

In October 2016, the shortlist for contractors to design and build the Massey Bridge was released, revealing Gateway Mobility Solutions, Lower Mainland Connectors and Pacific Skyway Partners as the lucky bidders:

One of the equity partners of Gateway Mobility Solutions, Aecon Group (Canada’s largest publicly traded construction company), donated $32,500 to the BC Liberals. Flatiron Constructors, one of the design-build contractors, also donated $12,800. In total, the Gateway Mobility Solutions partnership has donated $45,300 to the BC Liberals since 2009.

Together, the Lower Mainland Connectors group donated $200,895 to the BC Liberals. $111,675 of this came from Kiewit Contractors, which is headquartered in Nebraska and is one of the largest private contractors in the world. BA Blacktop, one of the design-build contractors for this team of bidders, also donated $72,170.

It should be noted that this contractor group also includes the Macquarie Group, the Australian company that owns Fraser Surrey Docks. Macquarie donated $17,050 to the Liberals to try to secure all of their interests.

The final contender for the contracts, Pacific Skyway Partners, includes SNC-Lavalin, a company that has been banned from applying for World Bank contracts and involved in corruption scandals in Quebec. They also conducted the ludicrous environmental study of the Fraser Surrey Docks coal transshipment project deemed entirely inadequate by health care providers and municipalities. This occurred after SNC-Lavalin bought a 23 per cent share in AltaLink, an electricity transmission company from Macquarie Essential Assets Partnership — a member of the Macquarie Group, again owners of Fraser Surrey Docks.

SNC-Lavalin has donated $27,647 to the BC Liberals. Their former board chairman, Gwyn Morgan, has personally donated more than $245,500. His wife, Patricia Trottier, donated $15,000 to the party. Morgan is also the founder of the oil and gas company EnCana, a company that has donated $1,243,751 to the BC Liberals. Further, Morgan was a key advisor and confidant of Christy Clark.

Big Bridge, Big Money

All this begs an important question: Is the new Massey bridge really in the interest of commuters, or industry insiders with massive pocket books and a cheque with the BC Liberals’ name on it?

For too long, it has looked like Big Money has bought political favours in this province. We need to know for certain if decisions, like building the Massey Bridge, were made under the influence of political donations. If approvals were granted to favour donors at the detriment of British Columbians’ health and safety, they need to be sent back to the drawing board and reassessed.

There is a way to develop a good transit plan without jeopardizing the safety of local communities, the health of the Fraser River and the animals that rely on it, all while protecting local farmland. No one denies the need for a new crossing of the Fraser, but there are certainly alternatives to a $3.5 billion dollar bridge wrapped in a bow for industry that taxpayers will be forced to pay for. Even certain Longshoremen have suggested that there are other options to ease congestion without removing the tunnel.

Big Money has secured its interests over those of British Columbians for long enough. Our government not only needs to act on their promise to ban Big Money fast — they need to begin a corruption inquiry to dredge up the facts and stop these harmful projects before it’s too late.

Image: Artist's rendering of the Massey Bridge. Photo: Government of B.C.

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In the wee hours of Wednesday morning major news outlets like the CBC made the official call: the B.C. Liberals had won a minority government in the 2017 provincial election.

Except they haven’t … quite … yet.

Here’s how the numbers are currently being reported: B.C. Liberals 43 seats, NDP 41 seats, Greens 3 seats.

These numbers are far from final. As Elections B.C. states right up there on its website, these are primary voting results from an initial count. “Final voting results will not be available until after the conclusion of final count, which will commence on May 22, 2017,” the site states.

There are about 160,000 absentee ballots waiting to be counted and some too-close-to-call ridings like Courtenay-Comox are facing a recount.

But, as Simon Fraser University student Steve Tweedale put it, we don’t need a final count to know it’s false to report the election resulted in a B.C. Liberal minority government.

“Assuming the preliminary count holds up, the outcome of the election is a hung parliament (sometimes called a minority parliament), meaning that no single party has a majority of seats. Under B.C.’s parliamentary system of government, elections determine the composition of the Legislative Assembly; they do not determine the composition of the government,” Tweedale writes.

The B.C. Liberals won 43 seats, just one seat shy of a majority. It is true that Clark will remain premier for the timebeing but she must retain the confidence of the house to continue as premier. If she cannot, one of several things can happen.

In this hung parliament situation, “the norm is the current premier gets the first shot at it, gets the first opportunity to form government,” UBC political scientist Kathryn Harrison told DeSmog Canada.

Clark could try her hand at governing with a minority government but in each act of convening the house she would run the risk of losing its confidence.

“One option would be for the Liberals to take their chances, stake out their positions, the route they would propose to go in government in a throne speech and invite other parties to defeat them which is an interesting option — it’s a bit of a game of chicken,” Harrison said.

“They won’t expect the popular vote.”

Or Clark could choose to step down.

“Sometimes it’s in the interest of a government to control the terms of their defeat,” Harrison said.

If Clark did announce her resignation to the Lieutenant Governor the buck would pass to NDP leader John Horgan to become premier with a minority government. Horgan, like Clark, would need to maintain the confidence of the house to carry this out.

But the B.C. Liberals and the NDP might also jockey for the support of the Green party's three MLAs in the hopes of forming either formal or informal coalitions.

As Clark said last night, “I will work with the other parties to do what needs to be done to keep fighting to protect” B.C.

Here’s where things get very interesting. If you watched coverage of the election last night you may have heard that Andrew Weaver’s Green party “held the balance of power” meaning the Greens have the option to formally (by forming a coalition government) or informally (by maintaining confidence through the support of policy measures and budgets, for example) prop up either the Liberals or the NDP.

“In the days ahead there will be plenty of discussions taking place between all parties,” Weaver told a room of supporters last night.

A BC Liberal Minority Government? Not So Fast https://t.co/CHmRlPXpub #bcpoli #bcelxn2017 @BCGreens #electoralreform @bcndp

— DeSmog Canada (@DeSmogCanada) May 10, 2017

A Liberal/Green Coalition?

It’s likely Clark will invite the Greens to join her cabinet, which they can do as Greens without crossing the aisle. But it is also likely that there will be some irreconcilable political differences that keep the Liberal and Green MLAs at loggerheads.

Weaver has yet to signal what his intentions are (although he did seem to suggest a preference for working with Clark in a controversial Global News interview) but throughout his campaign he stated banning big money in B.C. politics and electoral reform were up top on his list of priorities.

For years Weaver has campaigned to strengthen B.C.’s political donation rules, which currently allow unlimited amounts of foreign, corporate and union donations. The Green party has taken a strong stance on this issue by refusing to accept any corporate or union funds.

"Without any question, that's a deal breaker,” he said last week. “We've got to get the money out of politics.”

This could make the formation of a coalition government with the Liberals — a party awash in corporate cash — difficult.

The Green party is also committed to electoral reform, pushing for proportional representation in B.C. rather than the current first-past-the-post system.

“We support proportional representation because it is a fairer voting system, which encourages democratic participation and accurately reflects voters’ choices in the make-up of government,” Weaver said.

“It’s not obvious what the deal there would be,” Harrison said. “These are not issues that will be easy for Liberals and Greens to come to agreement upon.”

“Maybe financial reform,” Harrison said, “but electoral reform does not serve the Liberals' interests.”

On election night Weaver also stated his position on LNG is non-negotiable. Two LNG projects are approved in British Columbia — Woodfibre LNG in Howe Sound and Pacific Northwest LNG near Prince Rupert, which is projected to be one of the single largest source points of greenhouse gas emissions in the country, making it impossible for B.C. to meet its climate targets.

The Green party also pledged to cancel the controversial Site C dam, a crowning achievement and non-negotiable project for the B.C. Liberals.

So the differences in the Liberal and Green platforms seem pretty vast.

A NDP/Green Coalition?

As certainly as the Liberals will go courting the Greens, so will the NDP.

At a rally last night, John Horgan said a new government is in order.

“British Columbians have waited 16 years for a government that works for them, and we are going to have to ask you to wait a little bit longer until all the votes are counted and the final results of this election are known,” he said.

“But this is what we do know: A majority of British Columbians voted for a new government and I believe that’s what they deserve.”

A coalition between the NDP and the Greens seems easier to accomplish at least on the surface as the two parties share more general alignment on policies.

Of greatest significance is the NDP-Green alignment on two policies that would change B.C. elections forever. 

The NDP commitment to ban corporate and union donations falls squarely in line with one of the Green’s top priorities.

On electoral form, the NDP have also spoken in favour, vowing to send the issue to a referendum and campaign in favour of reform if if elected — also in line with the Green platform.

The NDP have also explicitly spoken out against the Pacific Northwest LNG project, due to significant greenhouse gas emissions and threats to the Skeena River salmon runs. So the NDP and Greens will likely have an easier time finding common ground when it comes to the LNG industry.

On Site C, the NDP have promised to send the Site C dam for an expedited review by the B.C. Utilities Commission, so it's also not hard to imagine the Greens and NDP finding common ground on this issue.

It’s possible a coalition with the Greens will give the NDP the political cover necessary to make several bold moves including banning big money in politics, moving to some form of proportional representation and possibly even scrapping the Site C dam altogether. 

Coalition a ‘Risky Proposition’ for Greens

The Greens will want to proceed carefully in their discussions with either the Liberals or the NDP, Harrison said.

“Coalitions governments are risky for junior partners,” she said.  

“I think for the Greens to enter a formal or informal coalition with either the NDP or the Liberals is a risky proposition because the junior partners in those coalitions tends to not fare well in the next election.”

The Green party will need to decide what its hardline tradeoff will be for supporting another party.

“Green parties internationally have a tendency to insist on some policy like a carbon tax — we already have one — as a condition for participation in the coalition and then get wiped off the map in the next election.”  

Yet there may be one key condition the Greens could place on their support: the promise of electoral reform.

“In this case I think the big win, the Holy Grail for the Greens would be a commitment to electoral reform for the system,” Harrison said.

The Green vote is depressed by the first-past-the-post system, Harrison said.

“It’s not that they don’t win seats, it’s that a lot of voters aren’t voting Green because they know their vote won’t count.”

A change in B.C.'s electoral system would both transform electoral politics in B.C. and would also change prospects for the Green party in the future, Harrison added.

“But it’s hard for me to imagine the Greens getting that concession from the Liberals because the Liberals have been the biggest beneficiary of the current electoral system.”

Image: Premier Christy Clark and Lieutenant Governor of B.C., the Honourable Judith Guichon, dissolve parliament for the 2017 election period. Photo: Province of B.C. via Flickr

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This article originally appeared on The Tyee.

There are places one can sit and consider the past and future with equal clarity. On this October day, Harold Steves, 79, an outspoken environmentalist and Richmond city councillor, looks from the riverbank at the end of Richmond’s Rice Mill Road.

Directly in front of him is the Fraser River, and directly below his feet lies Highway 99’s George Massey Tunnel. Given a $22-million seismic upgrade a decade ago, it was said by then-B.C. transportation minister Kevin Falcon that the tunnel was safe and a future twinning would eliminate the twice-daily commuter bottleneck.

But if today’s B.C. government has its way, work will start late this year on a massive $3.5-billion bridge, financed through a Public-Private Partnership (P3), to be completed by 2022.

Which means a stiff toll to pay off private creditors in the years ahead. Which will also mean that the perfectly safe, perfectly good tunnel will be removed.

Which could then allow that section of the riverbed to be dredged three to six metres deeper. Which will jeopardize migrating Fraser River salmon. But which will also provide sufficient draft for 300-metre ships to load coal and liquefied natural gas (LNG) at expanded riverside facilities in Delta, Surrey and Richmond. Which will encroach on adjacent Agricultural Land Reserve (ALR) farmland.

And which — given the incredibly explosive potential of LNG — will put tens of thousands of riverside residents at risk of becoming “human kebobs,” says Eoin Finn, a well-known LNG opponent who has been researching the industry for three years.

Steves peers up past a riverside cottonwood, imagining a humungous bridge directly overhead, and says to me: “There are so many thing wrong with it, it boggles the mind. It’s not just a threat to the Metro Vancouver Regional Plan. Or to the salmon. Or to ALR farmland. Or to local people.”

“Despite what Christy Clark says, the reason for the bridge has little to do with removing congestion,” Steves says. “A twinned tunnel would solve that. But Port Metro Vancouver doesn’t want a twinned tunnel. It doesn’t want any tunnels. It’s not about congestion. It’s about ships. The bridge has got everything to do with Port Metro Vancouver’s plans to industrialize the Fraser.”

“The bridge has got everything to do with @PortMetroVan’s plans to industrialize the Fraser.” https://t.co/N2AvLRMavx #bcpoli #bcelxn17 #YVR pic.twitter.com/leThGDYk3u

— DeSmog Canada (@DeSmogCanada) April 24, 2017

A Sudden Change in the Plan

I’m holding an emailed 11-point “Rationale” from the transportation ministry communications office dated Nov. 8, 2016, setting out the reasons for a new bridge over the Fraser River. (Despite repeated requests, neither Transportation Minister Todd Stone nor Port Metro Vancouver would be interviewed about the bridge plan.)

The statement is full of platitudes and exaggerations about the urgent need to eliminate the Massey Tunnel’s traffic snarls and purported seismic deficiencies. And it is clearly meant to gain support from frustrated commuters for an expensive highway bridge. There is not one word about tolls. Not one word about Port Metro Vancouver’s desire for Massey Tunnel removal and subsequent dredging so bigger ships can pass upriver. Not one word about the environmental consequences of this.

The bulleted 2016 list contains, in fact, this Orwellian rationalization for rejecting the widely supported and relatively inexpensive 2006 plan to twin the tunnel: “Twinning the tunnel was not an endorsement of a new tunnel, but rather an acknowledgement of the need to increase the capacity of this vital crossing.”

So “twinning the tunnel” has come to mean, in BC Liberal newspeak, building a 10-lane, three-kilometre-long, $3.5-billion toll bridge — almost seven times more than the 2006 estimate for twinning the tunnel and improving Hwy 99, according to a Vancouver Sun report at the time.

The machinations that led to this shift of provincial policy would not have been known if a coalition of environmental activists, calling themselves Fraser Voices, hadn’t begun seeking information about secret B.C. government communications, beginning in 2012, between Port Metro Vancouver, the Surrey Fraser Docks and their powerful shipping allies intent on opening up the river to huge Panamax vessels and the Fraser shoreline to industrial expansion.

But when the environmental group first asked for Freedom of Information access to government emails about how the twinned tunnels abruptly became the big toll bridge, researchers were told there weren’t any. They didn’t exist.

Among the Fraser Voice’s activists is Doug Massey, who at 83 can still get mad. “When I first heard the tunnel was going to be removed,” he says, “it got my Irish up.” After all, it was his father, George Massey, who spent years as a Delta MLA pushing for the crossing that now bears his name.

And Doug Massey knew that after the seismic upgrades were completed in 2006 the tunnel was in excellent shape. In fact, the 57-year-old tunnel is identical in construction to one built under Holland’s Maas River 74 years ago, and said to be good for 50 more years.

So, he wondered, what was really behind the push to replace his father’s tunnel? With help from investigative researcher Susan Jones and Kevin Washbrook of Voters Taking Action Against Climate Change, he began digging, and found that B.C. government emails did exist in the records of recipients like Transport Canada.

Sitting in his crammed home office in Tsawwassen, Massey starts handing me dozens of pages of emails.

The critical one is dated Feb. 2, 2012. The email schedules a meeting in the office of an assistant deputy minister in the province’s transportation ministry. On the invitation list were a senior ministry engineer, the CEO and a manager from Surrey Fraser Dock, and a “bridge engineer” from the company that did the earlier seismic studies on the tunnel. Port Metro Vancouver’s “Container Capacity Improvement Program” was also included.

The subject of the meeting, according to the ADM, was “options and considerations around the George Massey Tunnel and a sustainable navigational channel.”

That was more than seven months before Clark announced the government wanted to replace the tunnel and began public consultations and more than 19 months before she announced the bridge plan.

Shippers certainly supported the bridge option. And by September 2012 Transport Canada was being advised that industry and government stakeholders favoured removal of the tunnel. “This is what members have been telling me,” wrote Ruth Sol of WESTAC, an association of transportation companies, unions and governments, to Transport Canada. “George Massey tunnel needs to be replaced — to increase its capacity and the draft above the tunnel so larger ships can access the facilities on the Fraser River.”

Massey says the emails and reports he and his associates uncovered show Port Metro Vancouver and Surrey Fraser Docks were gathering information on the bridge height and channel depth required to allow LNG tankers and Panamax cargo ships to reach expanded port facilities on the Fraser River long before the provincial government announced the bridge plan.

On Dec. 4, 2012, still more than nine months before Clark announced the plan to replace the tunnel with a bridge, Port Metro Vancouver managers were setting out their goals in an email. Any new crossing should allow 15.5 metres of depth based on expected shipping needs in the next 50 years, and 18.5 metres based on a 100-year life expectancy, the port’s dredging expert noted. The current tunnel is 12 metres deep. PMV also wanted a bridge to be 65 metres above the Fraser, to allow ships to reach expanded port facilities on the Fraser.

Massey notes that the email exchanges reflect the port’s expansion plans. “We need to consider future terminals such as VAFFC, Lehigh, and possible terminal at our Richmond properties,” writes one PMV manager in an email about port plans along the Fraser River. (VAFFC is the planned Vancouver Airport Fuel Facilities Corporation jet fuel terminal and Lehigh refers to Lehigh Hanson’s plans for a bulk terminal.)

And an email from March 2013 makes Port Metro Vancouver’s desire clear: “Option No. 2: Replacing the tunnel with a new bridge in the same location. Not publicly confirmed yet, but this is (Port Metro’s) preference.”

Seven months later, Clark announced a new bridge.

Massey sees the decision as a betrayal of the public interest.

“I’m very upset that they they’re using the excuse the tunnel’s in disrepair. Or seismically dangerous,” he says. “No, it’s full speed ahead, damn the torpedoes! Build the bridge! It won’t be named after my father. I know that. He’d have hated the idea of removing a good tunnel for the bridge. It’s all about industrializing the lower Fraser. With taxpayers and commuters footing the bill.”

‘It’s a Boondoggle’

“I don’t think we’re getting the full picture,” says Claire Trevena, the NDP’s transportation critic. “It’s a boondoggle — with a starting price of $3.5 billion. What’s the rush for doing it? There’s been no cost-benefit study. No environmental study. No explanation about how it’s going to be funded. No consideration that if you build a toll bridge, you don’t want people riding transit. You want them in cars, paying $3.50 tolls.”

Her suspicions are propelled, she explains, by the fact that Kevin Falcon declared in 2006 that with the seismic repair work completed “The tunnel’s good for 50 years.” And he assured commuters that with the planned twinning of the Massey Tunnel and a new fast bus lane, Highway 99’s rush-hour congestion would be a thing of the past.

“The bridge is a big political bauble for Christy Clark. She announced it before the last provincial election. And construction was supposed to start before the 2017 provincial election,” says Trevena. “It makes no sense. Twinning it would cost a fraction of a mammoth new bridge. What are they going to call it? The ‘Christy Clark Bridge’?”

Story update:

The Vancouver Fraser Port Authority — formerly Port Metro Vancouver — issued a statement after this article was published.

It says the province consulted the port on proposed designs because it’s responsible for navigation on the Fraser River and “is required to ensure any overhead or underwater structures do not impede current or future shipping.”

“We provided information and data on vessels that currently or may use the river in the future, including considering whether or not the tunnel is removed in favour of a bridge,” the statement said.

“We prefer the bridge option because it will address a significant bottleneck for the movement of goods and people in the region and may provide more flexibility for trade,” the statement said. “However, it is ultimately the decision of the province as to which option to pursue.”

Ships are increasing in size to cut costs and environmental impact, the port said, “but removing the tunnel in favour of a bridge will not significantly change the size of ships that are able to use the channel for a number of reasons.”

The port authority said dredging to allow larger ships “would be prohibitively expensive” and “the width of the river does not allow very large vessels to turn.” Underwater pipeline crossings are also a barrier to ships with deeper draughts, the port said.

The new bridge will not have “a significant impact on the size of ships” using the Fraser River, the statement said.

Image: Artist's rendering of the Massey Bridge. Photo: B.C. Government

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This piece originally appeared on the West Coast Environmental Law Alert Blog.

Revelations about the amount of corporate money coming to the B.C. Liberals — not to mention RCMP investigations — have many people asking: what are these companies getting in return?

It’s a good question. After all, corporations are not supposed to spend their shareholders’ money without a reasonable expectation of a return. The different political parties are increasingly aware that voters have these questions.*

At a general level, it does seem that B.C. Liberal donors have done well in terms of government contracts.

And there have been specific calls to set aside the approval of the Woodfibre LNG project in Squamish (based on donations from Woodfibre that seem to have been illegally funneled through individuals), to re-examine logging in endangered caribou habitat by B.C. Liberal donor, Canfor, and calls on the B.C. Liberals to return funds received from Kinder Morgan and its allies (given the controversial decision to approve its pipeline and tankers project).

Corporate Donations and the Culture of (Environmental) Law Enforcement

But corporate benefits received in return for donations do not have to be about a particular government approval or a contract. Companies can also believe that their donations will result not in a particular decision, but in a more favourable regulatory culture — one that doesn’t ask hard questions or impose harsh consequences.

Over the years we have devoted many of our Environmental Law Alerts to looking at a major drop in the Province’s enforcement of environmental laws, with convictions under environmental statutes at a fraction of what they were prior to 2003.**

We have applauded the government for rolling out some new enforcement tools, but we remain very concerned that polluters in B.C. believe there are few consequences for failing to comply with our province’s environmental laws.

Arguably, one major beneficiary of that lax environmental enforcement is the number one B.C. Liberal donor: Teck Resources Ltd. Since 2008 the company has donated more than $1.5 million to the B.C. Liberals (and $60,000 to the B.C. NDP), thanks to B.C.’s loose laws on corporate donations.

Premier Christy Clark and Lt. Gov. Steve Point award Norm Keevil (centre), chair of Teck Resources, with the Order of B.C. Since 2010 Keevil has personally donated $65,585 to the B.C. Liberals. Photo: Government of B.C.

Teck Resources Compliance Issues

At first blush, it may seem surprising to suggest that Teck Resources is benefiting from a decline in environmental enforcement. After all, in early February 2016, Teck Metals Ltd. pled guilty to a number of charges related to polluting fish bearing waters, and was fined $3 million for Fisheries Act offences and a further $400,000 for Environmental Management Act offences.

However, this is just the tip of the company’s environmental non-compliance iceberg. Recently the B.C. Ministry of Environment released data on its 2015 efforts to monitor compliance under the Environmental Management Act (B.C.’s main law dealing with pollution). Two Teck-affiliated companies feature prominently.

Teck Coal Ltd. was inspected 58 times, and was found to be acting illegally in 46 of those inspections (i.e. 79 per cent of the time). Unfortunately, the data released does not tell us much about what type of non-compliance was occurring (although most of the inspections were considered “medium” or “high” priority, and we know from the Auditor General report discussed below that Teck’s non-compliance is a major concern for Ministry of Environment staff). Since we only have the data for 2015, we cannot say much about trends over time.

Of the identified non-compliance, the Ministry of Environment staff responded with an “advisory” (essentially a note to file) 67 per cent of the time, and provided a more detailed written warning 22 per cent of the time.

The remaining 11 per cent (5 incidents) were referred for further action, but at time of writing the government’s environmental violations database gives no information about what happened as a result. We know that between 2006 and the beginning of 2016 Teck Coal Ltd. has had just four tickets for $575 each issued against it (totaling just $2300).

Teck Metals Ltd. was inspected 12 times, and was out of compliance with its permits on seven, or 58 of those inspections. Five inspections resulted in advisories, and two in written warnings. In the past (and since 2006), Teck Metals has had previous convictions under the Fisheries Act and Environmental Management Act (2013) and avoided a third conviction (under the Environmental Management Act) in 2011 by participating in a restorative justice process through which it agreed to pay $325,000. It also had a single ticket issued against it in 2006 for $575.

Not all Teck companies had such a poor track record in the inspections. Teck Highland Valley Copper Corporation was inspected four times in 2015 and was in compliance at all four inspections. Teck’s Galore Creek Partnership also had four inspections, all of them clean.

Teck Resources is a huge operation, of course, so it’s not surprising that it has far more inspections than any other company in the government’s 2015 data. But Teck Coal’s non-compliance rates are well above average (on average the Ministry inspections found 60 per cent non-compliance). Indeed, it appears that the number of inspections carried out of Teck Coal reflects Ministry concern about this fact.

Auditor General Concerns

In 2016 B.C.’s Auditor General issued a damning report on enforcement of environmental requirements related to mines by the Ministries of Environment and of Energy and Mines. She wrote about the enforcement culture of the Ministries (which assumes voluntary compliance by mining companies) and the underfunding of compliance efforts:

We understand that [the Ministry of Energy and Mines’] collaborative strategy is viable in some circumstances, but it assumes that the majority of mining companies are willing to comply voluntarily. As we found for most of the mines we reviewed for this report, this is not the case. For the inspections reports we reviewed, there were incidences of non-compliance in most cases.

Based on her figures and our own research, we estimated that from 1990-1994, almost 10 per cent of pollution permits issued under what was then the Waste Management Act had some kind of compliance and enforcement action each year. From 2010-2014 that figure, for permits under the Environmental Management Act, was just above 2 per cent.

Auditor General Bellringer*** also provides an example of the clout that Teck Resources seems to have with the current B.C. government. The report used Teck Coal Ltd.’s permit to expand its Line Creek Mine in the Elk Valley as a case study.

After Ministry of Environment staff noted that the expansion would exacerbate a serious selenium contamination issue in the region, and refused to authorize the permit, Cabinet stepped in:

Subsequently, a decision was made by government to approve the permit under section 137 of EMA. This clause, which allows Cabinet to approve a permit where it is in the public interest to do so, had never been used before…

We also found that the Line Creek Expansion Permit has a site performance objective for selenium that allows five times the amount set in B.C.’s water quality guidelines for aquatic fish.

We concluded that government, in granting the permit, did not publicly disclose the implications these permit levels will have in this area where the expansion will extend the life of this mine for an additional 18 years and produce an additional 3.5 million tonnes of coal annually.

As well, we expected MoE’s permits to reflect the polluter-pays principle. We found, however, that under the Line Creek Expansion Permit, the mine company is charged only about $5,000 a year for emitting selenium pollution. This is not reflective of the known environmental impact of selenium. [emphasis added]

What Teck Resources Gets

Clearly, Teck Resources does not get a “get out of jail free” card (metaphorically speaking, since environmental offenders almost never actually go to jail). Teck Metals has been convicted and has paid fines. Teck Coal has been subjected to a high level of scrutiny by Ministry of Environment inspectors (but no major penalties as yet).

However, the evidence suggests that non-compliance with environmental regulations is business as usual for Teck Resources, and that is troubling. And on one occasion the government used an unprecedented power to override its own staff and allow the company to expand its operations dramatically, despite an ongoing pollution problem.

It’s important not to suggest that this is corruption. Donations in this case were given to the B.C. Liberal Party, not to individual politicians, and not in return for any particular decision. I believe that B.C.’s elected politicians, of whatever party and including the B.C. Liberals, want to do what they think is the right thing and do not believe themselves to be influenced by the fact that their party received a generous donation from Teck Resources.

However, the careers and campaigns of B.C. Liberal politicians have benefited from the powerful companies that the government is responsible for regulating. They have personal relationships with officials from those companies, formed through personal access at expensive fundraisers.

It is a fundamental legal principle of fairness that a government decision-maker should be unbiased, having no interest in the decision before him or her. Indeed, this requirement is so fundamental to the law, that a decision-maker must avoid even a credible appearance of bias. The fact that a large resource company with a poor environmental compliance record has made significant donations (i.e. more than $1.5 million since 2008) to the political party currently forming the government invites questions.

The courts have not generally applied the principle of bias to elected officials, instead accepting political donations as a legal part of the electoral system. In the U.S., where some judges are elected, a judge who has received campaign contributions may need to step down (or “recuse” his- or herself) from hearing a case involving that donor. However, that is because of the nature of judges — that they are supposed to apply the law without favour — and politicians have not been held to the same standard.

But I don’t think there’s any doubt that these types of large corporate donations do give rise to an appearance that some corporate interests have more influence over cabinet Ministers and the resulting government regulatory culture than individual voters. That’s a big problem — raising fundamental questions about our basic democratic institutions and our notion of equality before the law.  Are decisions about our lands, air and water, about the sustainability of our communities, being made in the interests of the public, or of large corporate donors?

In the end, the fact that many of us are asking these questions — and that there are no ready answers — is probably a good enough reason to get rid of corporate donations.

*  The B.C. Greens are ahead of the curve on this one, having pledged to go without corporate or union donations. The B.C. NDP has pledged to ban corporate and union donations if elected. And the B.C. Liberals are playing catch-up, with a panel appointed to investigate possible legal changes, but no specific promises.

**  The Ministry of Environment disputes our figures for convictions (but not tickets, so far as we understand), but has not provided alternative figures. 

***  As an aside — isn’t that a great name for an Auditor-General?  Very Dickensian (but more subtle than “Whistleblower”).

Image: Christy Clark during a tour of the Copper Mountain Mine. Photo: Province of B.C. via Flickr

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Alaskans tired of living under the threat of B.C.’s poorly regulated mines are taking the matter to the state’s House Fisheries Committee in an effort to escalate an international response to ongoing issues such as the slow leakage of acidic waste from the deserted Tulsequah Chief Mine in northwest B.C. into the watershed of one of the richest salmon runs in the B.C./Alaska transboundary region.

On Thursday the committee will assess a resolution sponsored by several House Representatives “urging the United States government to continue to work with the government of Canada to investigate the long-term, region-wide downstream effects of proposed and existing industrial development and to develop measures to ensure that state resources are not harmed by upstream development in B.C.”

Although Tulsequah is a catalyst, concerns go deeper as B.C. is handing out permits for a clutch of proposed new mines close to the Alaskan border, including the KSM mine, the largest open-pit gold and copper mine in North America.

Chris Zimmer, Rivers Without Borders Alaska campaign director, said Alaskans are troubled by B.C.’s lack of enforcement of mining regulations — underlined by the Mount Polley tailings dam collapse and its $40 million taxpayer funded cleanup — and the alarming practice of accepting bonds from companies that do not cover reclamation costs.

“If B.C. can’t ensure that the Tulsequah Chief is cleaned up, why should Alaskans have any trust that much larger mines like KSM won’t pollute our waters?” Zimmer asked.

‘B.C. Can’t Continue Saying it is World Class’ in Mining

A brief spark of hope that B.C. would act on Tulsequah flared after Energy and Mines Minister Bill Bennett visited Southeast Alaska in 2015 and was, reportedly, shocked by leakage from abandoned mine works and sludge ponds.

“I think B.C. is going to have to find a way to rectify it sooner rather than later and I think it is a most legitimate criticism of us by those folks in Alaska that don’t like it,” Bennett said at that time.

Since Bennett’s 2015 visit, B.C. government contractors have moved the pipe, so water runs into a containment pond before overflowing into the river, and cleaned up leaking fuel tanks and improperly stored chemicals, Zimmer said.

However, last fall, Chieftain Metals Corp., the latest owners of the mine, declared bankruptcy after running a water treatment plant for only six months and Bennett then appeared to backtrack on the promise of a full-scale clean up.

Bennett, who is not running in the May provincial election, did not return calls or emails from DeSmog Canada.

No provincial money has been publicly earmarked for the Tulsequah clean up, which David Chambers of the Center for Science in Public Participation estimates would cost about $3.8 million in Canadian dollars.

Total annual water treatment costs, which would have to be continued in perpetuity, would be about $3.4-million, according to Chambers’ study.

“And that’s just one tiny little mine,” Zimmer said.

Even if a new company takes over, there is no assurance it will clean up Tulsequah because, unlike Alaska, which estimates a realistic reclamation figure and then demands full payment up front, B.C. has no such guarantees, Zimmer said.

“The polluter-pay principle doesn’t work if the polluter goes bust.”

But in B.C. there is no assurance that the polluter will pay even if the company does not go bust, said Heather Hardcastle of Juneau-based Salmon Beyond Borders.

“The notion that reclamation sureties are not adequately assessed in B.C and companies don’t have to put up full reclamation sureties up front, as they have to do in Alaska and many other countries in the world, means B.C. can’t continue saying it is world class in terms of their mining sector,” she said.

Alaska sets the amount of the bond as part of the environmental assessment process, with public input, meaning that the bond is usually a realistic calculation of the cost of reclamation. The state then demands cash or bonds up front before the project can proceed.

In contrast, in B.C. the Chief Inspector of Mines has complete discretion in setting the amount of the bond, meaning it is not a transparent process. The figure is generally set much lower than in Alaska and the entire amount does not have to be paid up front.

B.C., unlike Alaska, will also accept guarantees, rather than insisting on cash or bonds.

Compared to Alaska B.C.’s Mines Represent Massive Taxpayer Liability

A glaring example of the differences is illustrated in a brief that independent economist Robyn Allan is presenting to the Alaska State Legislature.

Teck Resources Ltd. operates the Red Dog Mine in Alaska, which is expected to require water treatment in perpetuity, a cost that has been included in the reclamation estimate of $558-million.

Teck has fully funded its liability obligation at Red Dog by posting a bond of $558-million with the State, said Allan, a former ICBC president and senior economist for B.C. Central Credit Union.

Just across the border in B.C., Teck, the largest mining company in the province, is responsible for 13 mines — six operating and seven closed — and the province has estimated reclamation liability at $1.4-billion, but has required only $510-million in bonding, according to Allan’s brief.

“The $1.4-billion reclamation estimate excludes significant requirements for ongoing water treatment, such as those at Teck’s coal mining sites in the Elk Valley. Teck’s in perpetuity liabilities are likely underestimated by hundreds of millions of dollars,” she said.

Teck Resources is the largest donor to the B.C. Liberals, contributing $1,502,444 to the party since 2008.

Since 2010, Norman Keevil, Teck board chair, has personally donated $65,585 and DeSmog Canada revealed last month that political donations to the Liberals made under the name of a Teck Resources lobbyist were actually made by the company and were registered in error.

B.C.’s Mining Sector ‘Dysfunctional’

Allan, in her brief, says environmental assessment, monitoring and compliance of B.C.’s mining sector is dysfunctional.

“It places the environment and the public on both sides of the Canadian and U.S. borders at serious long-term risk,” she wrote.

A recent report by the University of Victoria’s Environmental Law Centre found B.C.’s mining rules have created a profound crisis of public confidence and should be investigated through a Commission of Public Inquiry.

“Mine reclamation liabilities in B.C. are underestimated and most mine operators are not required to provide full funding for the reclamation obligations that are estimated,” she said.

If B.C. adopted the Alaskan model of reclamation estimation and bonding, it would result in a more comprehensive and robust approach, according to Allan, who added in her brief that such changes could be made through policy adjustments rather than legislation.

Neither Alaska nor B.C. have an industry-funded pool for cleaning up accidental environmental damage or for paying compensation to those affected by mining accidents and companies are not required to have adequate insurance to cover accidents.

That begs the question why the mining industry is treated differently from other high-risk industries such as oil and gas, said Hardcastle, who believes the cross-border problem should be referred to the International Joint Commission, which operates under the 1909 Boundary Waters Treaty.

Allan agrees that both federal governments need to work together to develop measures to ensure mines do not affect downstream resources and that there should be an industry-funded pool for reclamation costs and compensation not met by mine operators following an unintended environmental accident.

However, there first needs to be accurate and transparent reclamation cost estimates and full security posted before a permit is issued, she said in her brief.

“Regrettably, the province of B.C. does not intend to enhance the requirements of its subpar system despite recommendations in recent reports released by the B.C. Auditor General and the Union of B.C. Indian Chiefs,” she wrote.

B.C. should also look at recent reforms Quebec made to its financial requirements for the mining sector, recommended Ugo Lapointe, Mining Watch Canada program coordinator.

Quebec requires 100 per cent financial assurance, with 50 per cent payable before the mine opens and 50 per cent in the first two years of operation, making it the strictest system in Canada, Lapointe said.

In contrast, B.C. remains one of the most problematic mining jurisdictions in the country, he said.

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Five B.C. Liberal candidates running in the current election are also former lobbyists who advocated for corporations including Chevron, Pacific Northwest LNG and ExxonMobil in the offices of Premier Christy Clark and other top ministers, according to records contained in the B.C. Lobbyist Registry.

None of the candidates’ profiles on the B.C. Liberal’s website note their previous work as lobbyists.

“I am alarmed at the number of lobbyists who are running in this election,” Dermod Travis, executive director of IntegrityBC, told DeSmog Canada.

“It may in fact point to a worrisome trend.”

“It’s not a generally considered a stepping stone in politics to go from being a lobbyist to an elected official. Where B.C. risks not electing a government but electing a boardroom of interests — whether corporate or union, it doesn’t matter,” Travis said. "In this instance it's obviously corporate."

B.C. has no broad rules preventing all former public office holders from moving directly from the public sector into employment as a lobbyist to serve private interests.

In Ontario former politicians must wait 12 months before registering as lobbyists. Federally the 'cooling-off period' is a mandatory five years.

B.C. does impose a one-year cooling-off period for senior politicians and bureaucrats from lobbying their former colleagues in instances where they had “substantial involvement in dealings with an outside entity,” but the system is far from perfect, Travis said.

Former Corporate Lobbyists Running for B.C. Liberals Part of ‘Alarming Trend’: Watchdog https://t.co/LbOCFb2YZG #bcelxn17 #bcpoli

— DeSmog Canada (@DeSmogCanada) April 5, 2017

“We have a ‘defrost period,’ “ Travis said, “because it’s not a mandatory cooling off period even where it exists.”

Multiple loopholes mean former public employees are often exempt from the rules.

“We see people going back and forth sometimes in the revolving door where at one moment they’re in the private sector and in the next, the public sector,” Travis said, adding lobbyists aren’t required to disclose if and when they receive kick backs from companies they secure government funding or contracts for.

These ‘contingency clauses’ are banned at the federal level, but in B.C. are kept secret, further obscuring the power lobbying has in the political process, Travis said.

“What’s happening through that process is special interests, self interests are getting put ahead of the public good.”

So who are the candidates?

Gabe Garfinkel, Christy Clark’s former top aide turned lobbyist, is running for the B.C. Liberal party in the riding of Vancouver-Fairview.

Garfinkel made headlines in 2013 after leaving his position of executive assistant to Christy Clark to work with prominent public relations firm FleishmanHillard which lobbies on behalf of high profile corporate clients like Kinder Morgan.

According to provincial lobbying records, Garfinkel registered to lobby on behalf of Chevron Canada, Fortune Minerals and Port Metro Vancouver among others and frequently listed the Premier as a “target contact” for these meetings.

In his work as a lobbyist representing mining and oil and gas interests, Garfinkel lobbied the office of the premier as well as Environment Minister Mary Polak and Minister of Energy and Mines Bill Bennett.

Jas Johal, candidate for Richmond-Queensborough, was the former director of communications for the BC LNG Alliance and registered to lobby on the behalf of BG Canada, ExxonMobil, Kitimat LNG, LNG Canada, Pacific Northwest LNG, Triton LNG and Woodfibre LNG between 2014 and 2015.

Brenda Locke, candidate for Surrey-Green Timbers, was an MLA between 2001 and 2005 and served as Minister for Mental Health and Addiction Services.

Locke left that position to lobby on behalf of the Massage Therapists’ Association of B.C. as recently as December 2016.

Kim Chan Logan, registered to lobby on behalf of TELUS from 2011 to as recently as March 20, 2017, was previously a ministerial assistant and chief of staff to the Minister of Health Services from 2001 to 2004.

Andrew Wilkinson, the B.C. Liberal Vancouver-Quilchena candidate was former Deputy Minister for Intergovernmental Relations, Deputy Minister of Competition, Science and Enterprise, and Deputy Minister for Economic Development between 2001 and 2006.

Wilkinson was a registered lobbyist for McCarthy Tetrault on behalf of Covanta Energy Corp., Energy companies Vattenfall AB and Kronos Project Management and mining company Thompson Creek Metals.

Between 2010 and 2012 Wilkinson registered to lobby the Premier and Energy and Mines Minister Rich Coleman among others. He previously registered in 2009 to lobby on behalf of Simon Fraser University.

Wilkinson is now the subject of lobbying in his positions as both Minister of Technology, Innovation and Citizens’ Services and Minister of Advanced Education for the B.C. Liberals.

Two additional former B.C. Liberals also left politics to take up lobbying work in the private sector.

Don Fast, former Deputy Minister of Community, Sport and Cultural Development from 2011 to 2013 left to start his own lobby firm, D. Fast Consulting.*

Dimitri Pantazopoulos, former campaign staffer for the B.C. Liberals, principle secretary to Christy Clark between 2011 and 2012 and former Assistant Deputy Minister of Intergovernmental Relations and Trade between 2012 and 2013, left for a career in lobbying.

Between 2013 and 2017 Pantazopoulos lobbied on behalf of Consumer Health Products Canada, Adobe, production company Cavalia, farm fish company Cermaq, Comcast, Johnson&Johnson, Pacific Newspaper Group, Black Press, Uber and Woodside Energy among others.

The back and forth movement between lobby firms and the public sector is a practice Travis considers “an incredible threat to how our system works.”

“It creates too many suspicions as to whose interests are being served.”

* This article has been updated to correctly indicate Fast was the former Deputy Minister of Community, Sport and Cultural Development and not Minister as previously stated.

Image: Premier Christy Clark at a Woodfibre LNG announcement. Photo: Province of B.C. via Flickr

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