Kinder Morgan is providing potential investors with shoddy information, according to a complaint filed with the Alberta Securities Commission by Greenpeace Canada last week.

The formal complaint contends the company’s draft prospectus — a legal document prepared for investors ahead of its massive $1.75 initial public offering (IPO) — failed to properly disclose future Asian oil demand and the financial impacts of climate policy.

It turns out that Kinder Morgan used demand forecasts that assume “business as usual” for oil consumption, which effectively means no serious attempt to keep global warming below two degree celsius.

“There are other demand forecasts that they haven’t used which aren’t as rosy,” says Keith Stewart, head of Greenpeace Canada’s climate and energy campaign. “The International Energy Agency has two other scenarios where governments actually do more to try to meet keeping warming below two degrees. In both of those, demand for oil drops significantly.”

In other words, Kinder Morgan is telling potential investors that it doesn’t expect Canada and the world to try to meet their Paris Agreement targets.

Suncor Climate Report Concluded 2 Degree Scenario Means No New Pipelines

The funny thing is that the 148-page Kinder Morgan document did disclose a number of others risks to investors. Those included government regulations, permits, public opposition, blockades, injunctions, judicial reviews, cost overruns, significant increase in debt and even bad weather.

But climate policies were only mentioned once, almost in passing: “Change in the regulatory environment or governmental policies (including in relation to climate change) may have an impact on the supply of crude oil and other products.”

That’s a serious understatement.

In Suncor’s 2016 climate report concluded the “450 ppm” scenario required to keep temperatures below two degrees of warming would result in a situation in which “new oil sands growth projects are challenged and unlikely to proceed” and “no new export pipelines are built out of the Athabasca Oil Sands region.”

The report was created in the wake of an approved shareholder resolution that called on Suncor to more transparently address the challenges of a low-carbon economy for energy producers.

“What we want to do is have companies have to confront the fact that our business model only works if the world fails to act on climate change,” Stewart says.

“Particularly for long-lived infrastructure like pipelines. If you’re going to spend $7 billion now and you’re planning to recoup that over the next 40 years, you’re banking on the world not reducing oil demand. And that’s increasingly risky.”

Business NotAsUsual: What #KinderMorgan Isn’t Telling Investors https://t.co/eCKyPNlEAi @dogwoodbc @Sierra_BC @PipeUpNetwork @NorthShoreNOPE pic.twitter.com/6pxQ8O10hu

— DeSmog Canada (@DeSmogCanada) May 25, 2017

Canadian Securities Regulators Currently Conducting Review of Climate Risk

Laura Zizzo — lawyer and CEO of Zizzo Strategy, which specializes in climate risk disclosures and carbon-informed investments — said in an interview with DeSmog Canada that the Greenpeace challenge is the first she’s aware of that involves direct interaction with a securities regulator with respect to climate change in Canada.

But that doesn’t mean it arrived out of nowhere.

“This all comes on the heels of a lot more shareholder and stakeholder activism with respect to securities disclosure and climate risk,” Zizzo says. “There’s lots happening in this space right now generally.”

For instance, there’s the recent vote by BlackRock — the largest asset manager in the world — to require Occidental Petroleum to disclose climate risks.

And Bank of England governor Mark Carney recently launched a task force on climate-related financial disclosures chaired by former New York City mayor Michael Bloomberg.

In December 2016, Carney and Bloomberg wrote in a column for the Guardian: “We believe that financial disclosure is essential to a market-based solution to climate change. A properly functioning market will price in the risks associated with climate change and reward firms that mitigate them. As its impact becomes more commonplace and public policy responses more active, climate change has become a material risk that isn’t properly disclosed.”

In late March, the Canadian Securities Administrators — which includes the Alberta Securities Commission — announced it was conducting a review of climate risk disclosures by public companies.

It’s why Zizzo says the Greenpeace challenge makes sense, noting it’s a legal requirement to disclose material information to investors and “if you’re an oil and gas company, climate-related issues are likely material.”

“I personally think Greenpeace’s claims were valid,” she says.

“The question is: ‘Do we think we’re going to meet the Paris targets? Do we think we’re actually going to do something about climate change?’ Kinder Morgan, in their projections, are kind of saying ‘no.’ They don’t think they will.”

Requiring Kinder Morgan to Re-Submit Would Be ‘Serious’

Stewart admits he doesn’t know exactly what’s going to happen next. After all, this is reportedly the first time this has happened in Canada.

In response to e-mailed questions a spokesperson from the Alberta Securities Commission told DeSmog Canada: “We have received Greenpeace’s submission and we will give it the consideration we deem appropriate.”

The regulator could ask Kinder Morgan to effectively resubmit its prospectus with more disclosure, which would be “pretty serious in a Canadian context,” Zizzo says.

Stewart says Kinder Morgan still has to put out a final prospectus before the IPO is marketed (to TD Bank and RBC, before being sold off to large institutional investors) and that Greenpeace will be watching to see what kind of changes are made in the language of that document.

In addition, the formal challenge might increase the chances of a class-action lawsuit from shareholders in the future because Kinder Morgan was advised to disclose risks and they chose not to, or may result in climate risk getting “priced in” and make the project less attractive to investors.

“It’s basically trying to use the discipline of market regulation to work in favour of action on climate change, whereas traditionally it has not,” Stewart concludes.

“This is a way to move things forward by entrenching some of these rules and actually making sure that investing in fossil fuel infrastructure isn’t just a bad thing to do, it’s a money-losing thing to do.”

Kinder Morgan didn’t respond to a request for an interview.

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The last few months have been marked by some massive shifts in the oilsands.

In December, there was the $830 million Statoil sale to Athabasca Oil, followed in January and February by the writing down of billions of barrels of reserves by Imperial Oil, ConocoPhillips and ExxonMobil.

On March 9, Shell sold a majority of its oilsands assets to Canadian Natural Resources Limited (CNRL) in a huge $7.25 billion sale, while Marathon Oil split its Canadian subsidiary between Shell and CNRL for a total of $2.5 billion.

The question is: why are all of these companies selling their oilsands assets? While some celebrate the moves as successes for the climate movement, others blame the Alberta NDP for the exodus of internationals.

But experts say the reality has more to do with a broader economic shift that’s made oilsands uneconomical — for the time being at least.

“The reason that Shell, Total and Statoil are pulling out, and the reason that Exxon has had to write down much of its Kearl Lake reserves, isn’t because of the emissions profile of the oilsands bitumen,” Jeff Rubin, senior fellow of Centre for International Governance Innovation, told DeSmog Canada. “It’s rather because it doesn’t make any economic sense, before we even look at emissions pricing.”

Canadian Companies Have ‘Bullish Long-Run View’ on Oilsands

Global oil prices have been extremely low for years. West Texas Intermediate is selling under $50/barrel. Meanwhile, Western Canadian Select — the benchmark for Alberta’s heavy oil — is currently priced at $35/barrel, about half of what’s required to build new “greenfield” production.

Such prices certainly are largely the result of the U.S. being flooded with oil thanks to the “shale revolution” that’s taken place in North Dakota’s Bakken Formation and Texas’ Permian Basin and Eagle Ford Group in recent years.

Of course, no company with oilsands assets likes the situation or prices. But some — especially those that have long specialized in heavy oil production, such as Suncor and Cenovus — have more of what energy economist Andrew Leach describes as a “bullish long-run view on oilsands” compared to international companies.

He says that their buying up of other companies and projects means they see some compatibility with existing assets, allowing for reduced costs in the long run by combining operations and maximizing economies of scale.

In addition, it’s far cheaper to acquire existing projects in the current market context than building new projects; Rubin says the likes of CNRL would argue the economics of oilsands projects span decades and that business-as-usual growth will eventually bring them online, even if they don’t look particularly viable at the moment.

“If you look at it from the buyers’ perspective, these are companies that see more value in the assets than the sellers do. It’s basic sales dynamics,” Leach, who teaches at the University of Alberta and chaired Alberta’s climate advisory team, told DeSmog Canada.

Shale Oil Increasing in Prominence for International Companies

After all, the oilsands still has the capacity to produce more than two million barrels per day of oil, even if production doesn’t grow in the next few years.

ARC Financial’s Peter Tertzakian recently told a Vancouver audience that the oilsands are “going to supply three per cent of the world’s oil needs over the next many decades, but that’s not where the growth is.” He emphasized the potential of the Montney Formation in northeast B.C. and northwest Alberta.

Mark Oberstoetter, lead analyst at the consultancy firm Wood Mackenzie, told DeSmog Canada in an interview: “It’s not so much that companies are exiting the oilsands, it’s the Canadians looking to take an opportunistic strategy on low oil prices and acquiring some pretty rare assets that you couldn’t normally get in normal times. You could almost say its aggressiveness from the Canadians.”

Take Shell for example. The Dutch company has played an increasingly prominent role in the oilsands in recent years, including publicly backing Alberta’s climate plan, constructing the Scotford upgrader and building the Quest carbon capture and storage (CCS) project.

But Oberstoetter says that Shell is now focusing on assets such as integrated gas, liquified natural gas, pre-salt Brazil, Gulf of Mexico deepwater and Permian tight oil assets. It’s about “shifting their portfolio down the cost curve into the assets they’re good at.”

And the oilsands just don’t make the cut for them.

“Tight oil has increased in importance for a lot of these companies,” Oberstoetter says. “They’re just refocusing their portfolios, at the end of the day. I don’t think they would have made these exits if they didn’t get a price that was attractive to them.”

What The #Oilsands Sell-Off Actually Means https://t.co/rsqhzHD6Xm @james_m_wilt #cdnpoli #ableg #bcpoli #ClimateChange #FossilFuels pic.twitter.com/nW1xLFnG3d

— DeSmog Canada (@DeSmogCanada) March 22, 2017

Some Companies Reference ‘Decarbonization’ While Still Focusing on Fossil Fuels

To be fair, some such companies have predicted “peak oil demand” arriving earlier than other major companies, as well as received what Leach calls “significant shareholder pressure relating to their oilsands holdings.”

“The interesting thing is if you look at Shell, Statoil and Total, who have all exited the tarsands, they’re the three companies that are saying, ‘we think a peak in oil demand is going to come in the next 10 to 15 years,’ ” says Keith Stewart, climate and energy campaigner at Greenpeace Canada. “It’s the Exxons of the world who are saying ‘oil demand will continue to grow for at least another 40 years’ who are doubling down on the oilsands.”

Recently, Shell announced it was tying executive packages to decarbonization. Leach notes the company has long had lower greenhouse gas emissions as a corporate priority, and has specifically carved out oilsands emissions in its annual sustainability report.

In addition, the company’s scrapping of the 80,000 bpd Carmon Creek project in October 2015 was reportedly tied to concerns about pipeline access, a problem arguably tied to activism by environmental groups. But it’s not like Shell is divesting from fossil fuels anytime soon.

While it has announced plans to increase annual spending on renewables up to $1 billion, there’s another $25 billion or so that will go to other non-renewable investments. Same goes for Statoil: while it operates in Norway, a country that’s had carbon pricing since 1991, and has indicated a desire to increase investments in renewables up to 20 per cent by 2030, the company’s speciality is still very much in offshore and deepwater oil extraction.

Writing Down Reserves Merely Reflects Last Year’s Prices

The writing down of reserves in filings to the Securities and Exchange Commission (SEC) simply indicates that oil prices were especially low, and that they wouldn’t be commercially viable if oil markets continue to look like they did on average last year.

If prices rebound, those reserves can and very likely will be added back.

What’s effectively happened over the last few months is the rearranging of corporate portfolios to get costs down and maximize strategic focuses, combined with some obligatory filings under SEC formulas.

Millions of barrels per day will continue to be pumped from Alberta’s oilsands. It will just be by different companies.

Photo: Syncrude Canada via Flickr

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The Canadian Association of Petroleum Producers (CAPP), Canada’s largest oil and gas lobbyist group, asked the federal government to introduce a carbon pricing scheme that would “recycle” revenues back into oil and gas operations, documents released via Freedom of Information legislation reveal.

The documents, released to Greenpeace Canada, contain an August 2016 submission CAPP provided to the federal government in which the group argues a price on carbon should be revenue neutral for industry.

“One of the decisions governments need to make is what to do with the revenue generated from the carbon pricing mechanism,” the document reads. “There are many options available to enable innovation for distribution of this generated revenue; CAPP recommends that to enable innovation, revenue generated by industrial emitters is best recycled back to industry for technology and innovation.”

Keith Stewart, senior energy strategist for Greenpeace Canada, says, “The oil industry formally supports action on climate change (in exchange for pipeline approvals) but wants to shape how the policy is implemented so as to minimize the impact on its own operations.”

In a summary piece for Policy Options, Stewart says the recommendation to channel carbon taxes back into industry operations “dramatically weakens the effectiveness of the federal policy.”

“The primacy advantage of a carbon price is that it sends an economy-wide signal to investors and consumers, leading to a shift to lower-carbon options. If the largest share of the revenue goes back to the oil industry, the signal to investors to switch to low-carbon energy is muted.”

Pressure from CAPP comes as the federal government is preparing to release the first Gazette I version of greenhouse gas emissions for the oil and gas sector later this month.

Industry lobbying efforts successfully staved off greenhouse gas emission regulations for the oil and gas sector throughout the entirety of former Prime Minister Stephen Harper’s 10-year rule. Further lobbying efforts also stymied a European effort to label fuel from the Alberta oilsands as more carbon intensive than other fossil fuels.

Under the international Paris Agreement and the Pan-Canadian Framework on Clean Growth and Climate Change, Canada has committed to a 2030 target of reducing greenhouse gas emissions by 524 megatonnes of carbon dioxide equivalent, a 30 per cent reduction from 2005 emission levels.

Environment and Climate Change Canada estimates new oil and gas regulations will reduce emissions by 20 megatonnes (MT), greater than Nova Scotia’s total emissions at 17 MT.

The upstream oil and gas sector is Canada’s fastest growing source of greenhouse gas emissions.

In addition to imposing a nationwide carbon pricing mechanism — provinces have until 2018 to implement one or have one imposed — the federal government is also implementing regulations to reduce methane emissions from the oil and gas sector.

CAPP Lobbies Government to ‘Recycle’ #CarbonTax Revenues Back to Oil Industry https://t.co/U6ydduAMfn #ableg #cdnpoli @carollinnitt pic.twitter.com/JEtq49vlNk

— DeSmog Canada (@DeSmogCanada) March 3, 2017

CAPP’s Fight Against Methane Regulations

Additional internal documents released to Greenpeace Canada show CAPP overestimated the cost of implementation and argued the new rules will damage industry’s competitiveness.

“Canadian production is already at risk of being displaced by U.S. competition,” a CAPP presentation made to the federal government in September 2016 reads.

It is “not a good time to impose additional costs on industry,” a slide states.

In March 2016, former president Barack Obama and Justin Trudeau announced an ambitious plan to nearly halve methane emissions from the oil and gas sector by 2025.

In Canada the reductions would be the equivalent of removing every passenger car from the roads in both B.C. and Alberta.

Canada’s forthcoming methane regulations are expected to outline how the sector will achieve those reduction targets.

CAPP, however, recommended the federal government delay implementation of methane regulations beyond the currently proposed 2020 and argued some aspects of the rules, such as mandatory retrofitting of all equipment or regular equipment inspections, should be voluntary.

CAPP’s argument that the new rules are too costly is simply a negotiating tactic, Stewart says.

“CAPP says that the cost to industry of implementing the federal methane regulations would be roughly triple what Environment Canada calculates: $4.1 billion over eight years, compared with Environment Canada’s estimate of $1.3 billion,” Stewart writes.

“Industry push-back on environmental regulations is to be expected and is most effective when conducted behind closed doors.”

Image: Machinery operates in the Alberta oilsands. Photo: Kris Krug/DeSmog

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The National Energy Board is fundamentally broken.

That was a point repeatedly highlighted by Prime Minister Justin Trudeau during the 2015 federal election — and one confirmed for many with recent revelations that former Quebec premier Jean Charest had privately met with senior NEB officials while on the payroll of TransCanada.

Trudeau and his federal cabinet have the chance to change that: in June, the government announced dual review panels to assess the mandates and operations of the NEB and the country’s oft-criticized post-2012 environmental assessment processes (it also announced five interim principles until those reviews are completed, including a requirement to assess upstream greenhouse gas emissions although it’s unclear how that information is being used).

But for those to serve as anything more than symbolic gestures of goodwill, the pause button must be hit on the reviews of Kinder Morgan’s Trans Mountain and TransCanada’s Energy East pipeline proposals.

Those review processes need to be completely redone once recommendations from the two review panels have been implemented.

If it sounds demanding, that’s probably because it is. But that’s the price of real change.

‘To Govern is to Choose’

If built, the Trans Mountain pipeline and Energy East pipeline would add a combined 1.79 million barrels per day of export capacity from the Alberta oilsands (690,000 and 1.1 million barrels/day, respectively).

Let’s put that in context.

The Canadian Association of Petroleum Producers has projected that heavy oil production will increase 1.45 million barrels per day by 2030, to a total of 3.99 million barrels per day. In other words, the two massive projects currently under review would lock in more than enough export capacity for the oilsands to maximize its growth to 2030.

If paired with the construction of a single LNG export facility in British Columbia, this situation would require the rest of the Canadian economy to contract by 47 per cent from 2014 levels by 2030 in order to meet the country’s Paris Agreement targets (an impossibility “barring an economic collapse” according to David Hughes, who calculated those numbers in a Canadian Centre for Policy Alternatives report).

In other words, approving the two projects would completely botch the country’s chances of meeting international climate commitments.

“When you’re in opposition, you can be strongly committed to contradictory things,” says Keith Stewart, climate and energy campaigner for Greenpeace Canada.

“But to govern is to choose. And the Liberals have been very clear they want to meet our international climate commitments, implement the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP) and get a pipeline built. The problem is you can have, at most, two of those.”

Why @JustinTrudeau Should Call Off the Reviews of Trans Mountain and Energy East https://t.co/TslT4Z5IbV #bcpoli #cdnpoli

— DeSmog Canada (@DeSmogCanada) August 24, 2016

Opportunity for Canada to Enact ‘Visionary Environmental Laws’

The review of the process has great potential, especially given the impacts of the gutting of environmental assessments in 2012 under former prime minister Stephen Harper.

Anna Johnston, staff counsel at West Coast Environmental Law Centre, describes the review as a “once-in-a-generation opportunity for Canada to enact really visionary new environmental laws and processes.”

Johnston says a key component is to hold projects to a higher standard — requiring companies to prove net benefits as opposed to not simply posing a “significant adverse impact” — as well as measuring total cumulative impacts. Such an approach would result in a threshold of potential greenhouse emissions, meaning some projects simply wouldn’t be considered due to impacts on meeting climate targets.

“Those are just going to a red light and won’t even need to go through an environmental assessment process as we know this huge project is going to take up way more of its fair share of greenhouse gas emission allocations,” she says.

The panel members for reviewing environmental assessment processes were announced on August 15: it will be chaired by Johanne Gélinas of consulting firm Raymond Chabot Grant Thornton, Renee Pelletier of the Aboriginal law firm Olthuis, Kleer, Townshend LLP, Rod Northey of law firm Gowling WLG and Doug Horswill, senior vice president of Teck Resources and “honorary life director” of the Mining Association of Canada. (Interestingly, Bob Rae is a senior partner at Olthuis, Kleer, Townshend and Rod Notley has donated $17,000 to the Liberals since 2004).

Erin Flanagan, director of federal policy at the Pembina Institute, says the panel has “a solid balance of perspectives and experience on the file.”

The panel members for the NEB review haven’t been announced yet. The executive summaries of the final reports will be published on January 31, 2017; Flanagan emphasizes “the clock is ticking – it’s a huge mandate to execute on by early 2017.”

There’s plenty of ground to cover.

Trans Mountain, Energy East Remain Exempt

But even if the review panels produce progressive recommendations — for instance, calling for the revamping the Canadian Environmental Assessment Act, returning the responsibility for federal environmental assessments of interprovincial and international pipelines to the Canadian Environmental Assessment Agency and treating Indigenous nations as much more than an afterthought — they wouldn’t apply to the two biggest pipeline projects in recent Canadian history.

The federal cabinet will be making a decision on the Trans Mountain pipeline before Christmas, a full month before the review panels deliver their recommendations (the NEB approved the project in May with 157 conditions). This occurs in contradiction to a promise Trudeau made during the election that the NEB review would apply to the project.

The government’s ad-hoc supplementary review panel, intended to improve public consultations, has come under serious fire for conflict-of-interest allegations and failures to offer translation services or livestreaming, in many ways pointing out the massive flaws of the existing process.

Those meetings have, by and large, been an opportunity for communities to voice their majority opposition to Trans Mountain and the review process. In the case of Vancouver and Victoria, the overwhelming number of public participants voiced opposition to the pipeline project.

The NEB’s review process for Energy East is already underway via panel sessions in communities. The bulk of the work won’t start until 2017.

But if the federal government is serious about addressing concerns about the NEB, why not hold off on the panel sessions until community members are fully aware of the stakes? Currently, intervenors are operating under the expectation that the NEB will be responsible for conducting the environmental assessment of Energy East, a reality that could very well change if the dual review panels recommend serious alterations to processes.

Canadians Still Without Restored Environmental Laws

In February, Ecojustice argued in regards to the TransCanada project that “the government missed a golden opportunity to put the entire process on hold until legislative amendments could effectively repair the damage done by the Harper government’s rollbacks.”

Green Party leader Elizabeth May has also voiced concern, stating in June 20 press release that “I vigorously opposed the idea of a drawn-out consultation without first repealing the devastating changes made to environmental assessment in omnibus budget bills of 2012” and “the government is choosing to continue with a broken system while it consults stakeholders.”

The future changes may be hugely beneficial, barring carbon-intensive LNG facilities, oilsands upgraders and other industrial emitters from ever entering the review process. But the Trans Mountain pipeline and Energy East could very well be on the path to construction and export, further jeopardizing Canada’s environmental reputation.

Government Hanging onto ‘Deeply Flawed’ Process

The Liberals have already established an unfortunate track record of blaming the previous government for politically unsavoury decisions they could have very well stopped: think the controversial sale of light-armoured vehicles to Saudi Arabia, the government’s decision to withdraw an appeal to force the Catholic Church to pay reparations for its significant role in running residential schools or the approval of permits for construction on the controversial Site C dam in B.C.

It’s a bit of a sunk costs fallacy, but one shaded by an obvious desire to keep the real political mechanisms and motives under wraps.

The same appears to be occurring with the two major pipeline approvals. The government made the powerful and convincing argument during the election that the review process was broken. Yet it has allowed the NEB to continue reviewing Trans Mountain and Energy East.

“You had Trudeau say that this process isn’t credible,” Stewart says.

“So what are you actually going to do about that? How can you approve a major controversial project based on a process that you’ve already said is deeply flawed and is proved once again that it’s deeply flawed? I just don’t understand how they think they can move that forward.”

Image: Prime Minister Justin Trudeau and B.C. Premier Christy Clark meet in Burnaby, B.C., site of the Kinder Morgan Trans Mountain export terminal. Photo: Prime Minister's Photo Gallery

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Suncor Energy CEO Steve Williams rocked the oil industry boat Thursday when he announced a plan to leave some of the company’s oilsands reserves unrecovered during a conference call with investors.

Williams said the company is working to develop a plan with Alberta to “strand” its least economical reserves, a proposal that appears to align with the call of environmentalists to leave the high-cost and high-carbon fossil fuels in the ground to prevent catastrophic global warming.

“We are advocating in a modest way to work with government so that we can strand some of the oil in the oilsands,” Williams said, as reported by The Canadian Press.

“Our regulation is written so that we take to a very high percentage the last piece of oil out. That tends to be the most expensive both economically and environmentally. What we would like to do is leave that last piece in (the ground),” he said.

“I’m very optimistic we are making some breakthroughs with government to do that.”

The proposal is about more than leaving some oil deposits undeveloped, according to Simon Dyer, director of the Pembina Institute.

“We’re talking about Alberta moving philosophically from maximizing production to optimizing value,” Dyer told DeSmog Canada.

Having a conversation about where, when and how to leave behind the most expensive and highest polluting deposits just makes sense within the context of the Alberta climate plan, which caps total oilsands emissions at 100 megatonnes, and the Paris Agreement, he said.

“We have 166 billion barrels of oil in the oilsands. In 40 years we’ve extracted six per cent of them. It’s inconceivable to think we’ll extract all of them even though our regulations are written in a way that we don’t leave a barrel behind.”

Dyer said Williams is seeking a change in those regulations.

“It’s the first timid steps towards a ‘leave it in the ground’ conversation,” he said.

Suncor holds approximately 8.7 billion barrels of oil in the oilsands, including open pit mines and in situ operations. Focusing on its most profitable projects could save the company 10 to 20 per cent in operating costs, Williams said.

Keith Stewart, head of Greenpeace Canada’s climate and energy campaign, said Williams surprised a lot of people with his request but added it’s unclear at this stage how Alberta will manage Suncor’s request.

“It's important to recognize that what [Williams] really wants to do is 'high-grade' his existing reserves: exploit only the cheapest and most profitable parts,” Stewart said.

There may be some hesitation on the part of Alberta, which relies on oil royalties, to simply allow companies to back out of oil extraction agreements, he said. Extraction agreements are managed under Directive 82, something Alberta may have to alter to accommodate Suncor’s request.

Suncor Opens Conversation about ‘Stranded Assets’ in #Alberta’s #Oilsands https://t.co/Ne04sUzuFB #cdnpoli #ableg

— DeSmog Canada (@DeSmogCanada) August 2, 2016

“Lease agreements often establish rules that limit 'high-grading' and Suncor is clearly trying to get those rules changed,” Stewart said, adding this would likely help companies shut-in low-performance in situ operations.

Stewart said it makes sense in an increasingly carbon-constrained world for fossil fuel companies to want to back out of their least profitable leases and added it’s interesting in this case that Williams chose to adopt the language of environmentalists to justify doing so.

“He could have said this in corporate-speak that would be meaningless to most, but instead he used a term that — until recently — was only used by the environmental movement. The asset is stranded, or worthless, because the oil has to stay in the ground to avoid dangerous levels of warming and that isn’t something most oil executives want to talk about.”

While high-grading assets isn’t necessarily a bad thing from an environmental perspective, the act of stranding assets needs to be considered in a global context, Stewart said.

“Williams called for a ‘modest’ stranding of assets, whereas climate science tells us we need to strand around 80 per cent of fossil fuel reserves. So we’re still far apart on how much ‘stranding’ is called for. But if you think back to the federal election, it was considered heretical when an NDP candidate suggested some of the oilsands had to be left in the ground so this is an interesting development.”

Alberta’s climate plan placed a hard cap of 100 megatonnes on oilsands production, but 130 megatonnes of projects have already been approved.

Dyer, who sits on the Alberta Oilsands Advisory Group, a coalition of industry, environmental and First Nations leaders, said Alberta faces the difficult task of taking approved projects off the table.

“We’re going to have a competitive process whereby the Alberta regulator decides which projects go forward. They can’t all go forward under the cap so again we’re in a situation where the Alberta Energy Regulator, instead of approving every project, has to decide which of these projects is better for Alberta,” he said.

“If we’re never going to extract all of the bitumen, why don’t you high-grade and take the most profitable stuff that has the least environmental impact?”

Dyer said it’s important for Alberta to recognize a global transition away from fossil fuels is taking place.

“You’ve got to consider the Paris agreement and countries musing about being fossil fuel free by 2050 and the uptake of electric vehicles,” he said.

“It’s a tough point for Albertans but whether we like it or not the world’s changing,” he said. “At the current rate of production it would take us 200 years to get through the oilsands. It’s just inconceivable that will happen.”

So, if some of Alberta’s bitumen is being taken off the table, a conversation needs to take place about how that will happen. Dyer said he hopes that conversation will take place publicly and transparently.

“I think if we get policy to move from the idea that you extract everything regardless of the benefit or the cost and instead you actually make decisions based on optimizing benefits, that can only be a positive thing.”

Image: Steve Williams at a 2012 Suncor Annual General Meeting via Flickr

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Natural Resources Minister Jim Carr told reporters Wednesday that ongoing oil pipeline reviews will continue on as usual, despite a promise by the Liberal government to make the environmental assessment process more robust.

“They have not stopped,” Carr said. “The process continues.”

Ongoing National Energy Board reviews will continue for projects like the Kinder Morgan Trans Mountain pipeline expansion even though the Liberal party platform promised an immediate review of the process, saying the renewed assessments will “restore robust oversight and thorough environmental assessments” and “restore lost protections” resulting from weakened environmental laws under the Stephen Harper government.

Minister Carr indicated the National Energy Board review process will undergo a transition but until that time, project reviews will remain unchanged.

“There will be a transition as we amend the ways in which the National Energy Board goes about the process of evaluating these projects,” Minister Carr said, “and we will announce those changes as soon as we can, but the process continues.”

The announcement has some wondering what to make of Prime Minister Justin Trudeau’s assertion that a more robust process would apply to the to Kinder Morgan Trans Mountain pipeline.

In August, Dogwood Initiative’s Energy and Democracy Director Kai Nagata pressed Trudeau to confirm if an NEB overhaul would apply to the Kinder Morgan project.

“Yes. Yes,” Trudeau said. “It applies to existing projects, existing pipelines as well.”

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Trudeau on Kinder Morgan

Justin Trudeau says if he's Prime Minister, Kinder Morgan will have to go back to the drawing board, saying "the process needs to be redone." Find out where candidates in your riding stand: http://votebc.ca/

Posted by Dogwood Initiative on Friday, August 21, 2015

“Okay,” Nagata said. “So if they approve Kinder Morgan in January, you’re saying…”

“No, they’re not going to approve it in January. Because we’re going to change the government,” Trudeau responded. “And that process needs to be redone.”

After the Obama administration's recent refusal of the Keystone XL pipeline through the U.S. and a nearly dead Northern Gateway on B.C. northern coast, Kinder Morgan is upping its efforts to ensure the Kinder Morgan Trans Mountain expansion goes ahead.

On Friday Trudeau publicly released ministerial mandate letters, including one to Minister Carr that instructed him to “immediately review Canada’s environmental assessment processes to regain public trust and introduce new, fair processes” as well as “modernize the National Energy Board.”

“You can't slap some new paint on the Conservative review process and call it credible after campaigning against it,” Keith Stewart, energy and climate campaigner with Greenpeace Canada, said.

“I don’t see how the Trudeau government can continue with the review of a pipeline under rules that Trudeau has denounced for ignoring climate impacts, failing to respect Indigenous rights, and lacking a grounding in sound science.”

This week marks the passing of one year since hundreds of protesters gathered on Vancouver’s Burnaby Mountain to disrupt crews performing exploratory drilling for the Trans Mountain pipeline.

A massive loss of faith in the NEB process was on full display on Burnaby Mountain after nearly 500 citizens were prevented from participating as intervenors in the Trans Mountain hearings.

This included a group of 27 climate experts, including economists, scientists and academics.

The National Energy Board also quietly removed oral hearings from the process, which means oral cross-examination and testimony under oath are no longer part of the review.

These procedural deficits have made it easy for Kinder Morgan to refuse to answer questions from expert interveners, such as lawyers from Ecojustice.

Even the province of B.C. has been put in a position where it must fight Kinder Morgan for basic information about the expansion project. In early 2015, DeSmog Canada revealed that the company was refusing to release spill response plans to the B.C. government, even though the same spill response plans had been made available to the public in Washington State.

Beyond that, the review process has excluded local First Nations to such an extent the Tsleil-Waututh Nation, which is located directly across the Burrard Inlet from Kinder Morgan’s facilities, launched a legal action to challenge the credibility of the review process.

Last fall, energy executive Marc Eliesen publicly abandoned his role as an intervenor in the review process, calling it “fraudulent” and an act of “public deception.” Eliesen accused the board of engaging in a process that was rigged with a “pre-determined outcome.”

The current pipeline review process also considers upstream oilsands impacts to the environment and climate outside the scope of a relevant environmental assessment.

Terry Beech, Liberal MP in Burnaby North-Seymour, told the Burnaby NOW no decision on the Kinder Morgan pipeline would be made under the current system.

“We are going to redo the National Energy Board process,” Beech said. “We’re going to broaden the scope. We’re going to make sure it’s objective, fair and based on science.

“We’re going to make sure proponents of any major energy projects, including Kinder Morgan, have to work towards getting community support and support from partner First Nations,” he said.

“We’ve already said there will be no decision on Kinder Morgan in January. Kinder Morgan will have to go through a new, revised process.”

Image: Burnaby Mountain protest by Zack Embree

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Raging wildfires and apocalyptic smoke. Huge algal blooms visible from space turn seafood on the Pacific Northwest toxic. California’s drought. Alberta’s drought. Alberta’s floods.

There’s no doubt: it’s hot and weird out.

According to officials with the National Oceanic and Atmospheric Association (NOAA) July was the hottest month ever recorded, putting 2015 well on track to beat out 2014 for the hottest year on record. Records date back to 1880.

NOAA climate scientists Jake Crouch said the new data “just affirms what we already know: that the Earth is warming.”

“The warming is accelerating and we’re seeing it this year.”

According to figures released by the NOAA, the average temperature for July was 16.6 Celsius (61.86 degrees Fahrenheit). That beats out previous record highs from 1998 by 0.08 C (0.14 F).

July also broke the record for ocean warmth. The average sea surface temperature was 0.75 C (1.35 F) above the 20th century average.

Keith Stewart, climate and energy campaigner with Greenpeace Canada, said when it comes to breaking temperature records we’re just getting started.

“I think from now on out the anomaly will be when a year or a month isn’t the hottest ever. These things do go up and down but the trend is upwards so we’re going to continue breaking records until we take serious action to reduce greenhouse gas emissions and even then the warming is going to continue for decades,” he said.

NOAA climate scientist Marshall Shepherd said he is concerned the seriousness of breaking pervious temperature records may not be hitting home with the average person. “I worry the public will grow weary of reports of new records each month,” he told the Canadian Press.

"I am more concerned about how the Earth is starting to respond to the changes and the implications for my children," he said.

Breaking temperature records “is an abstract thing,” according to Stewart.

“But when people see the drought in northern Alberta, and in northern B.C., the wildfires, flooding in other parts of the country, this is where it’s really hitting home. Those things you simply can’t ignore.”

“By choosing not to act on climate we’re making a decision to increase future suffering.”

Climate scientist Michael Mann said not only are we anticipating 2015 to be the hottest year on record, but “now we learn that we just saw the hottest single month Earth has experienced since record-keeping began.”

He said the evidence points out the absurdity of climate science deniers: “the continuing false claims by climate change deniers that global warming has somehow stopped become more ludicrous by the day.” 

Mann said despite what deniers claim, the warming carries on.

“It is time to act by reducing carbon emissions before it is too late, and we lock in ever more dangerous and potentially irreversible changes in our climate.”

Stewart said he agrees with the way President Obama’s science advisor John Holdren put it.

“He said there are three things we can do about climate change: we can reduce greenhouse gas emissions so that we warm less, we can adapt so when the impacts hit they don’t hurt as much, and we can suffer.”

“We are going to do all three but the policy choices we make determine how much we do of each,” Stewart said.

“The more we change our energy system to low-carbon, the less we’ll suffer

That’s the kind of choice we need to be putting in front of people. So when people see these records being broken they know there is actual suffering that goes along with that.”

Image Credit: Wildfire near Kelowna, B.C. Brian Davis via Facebook

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If the recent frufrah over NDP candidate Linda McQuaig’s comment that “a lot of the oilsands oil may have to stay in the ground” is indicative of anything, it’s that Canada’s election cycle is in full spin. May all reasonableness and sensible dialogue and accountability be damned.

Perhaps that’s the blunt and singular reason behind the Conservative Party and Prime Minister Stephen Harper’s outrage at McQuaig’s entirely non-contentious assertion that, because of our international commitments to curtail global climate change, Canada won’t exploit the entirety of its oil reserves.

Harper accused the NDP of having a “not-so hidden agenda,” saying the party “is consistently against the development of our resources and our economy.”

“That’s why they…would wreck this economy if they ever got in, and why they must never get into power in this country.”

But Harper’s reaction seems conspicuously overwrought given the Prime Minister’s own pledge, along with the other G7 nations, to phase out the use of fossil fuels by 2100.

At the time of signing — a whole two months ago — Harper said the plan would “require a transformation in our energy sectors.”

He added: “Nobody’s going to start to shut down their industries or turn off the lights. We’ve simply got to find a way to create lower-carbon emitting sources of energy — and that work is ongoing.”

Harper may have been diplomatically coerced into signing the G7 leader’s declaration. After all, an inside source did come forward at the time to say Canada and Japan were “the most concerned” about the agreement and according to federal Green Party leader Elizabeth May Canada played a role in delaying the pledge's original 2050 target date. At the very least, the declaration runs contrary to the Prime Minister’s own energy superpower ambitions.

Yet the decarbonization pledge wasn’t exactly out of left field, either.

Several major institutions had already come forward to raise concern about the risk of stranded assets in a carbon-constrained world.

Already in 2012 the International Energy Agency (which Bloomberg concedes “is no den of Greenpeace radicals”) concluded that to stay within the 2 degrees Celsius limit for global temperature rise, two-thirds of the world’s known fossil fuels must remain underground. 

Then in the fall of 2013 the Intergovernmental Panel on Climate Change released its calculations on the world’s “carbon budget” and warned more than half of the global carbon dioxide allowance had already been used up. The scientific body warned “substantial and sustained” reductions in greenhouse gas emissions were immediate necessary to avoid passing that 2 degree Celsius target.

In 2013 a study led by Lord Nicholas Stern from the London School of Economics along with Carbon Tracker identified trillions of dollars dangerously reliant on inflated fossil fuel reserves. The so-called “carbon bubble” could trigger a major economic crisis, the report warned.

In 2014 the Bank of England warned insurance companies of the risk of potentially worthless fossil fuel investments, after its head Mark Carney cautioned the “vast majority of [fossil fuel] reserves are unburnable.”

Around the same time President Barak Obama bluntly stated: “We’re not going to be able to burn it all.”

“Well, science is science,” the president said. “And there is no doubt that if we burned all the fossil fuel that’s in the ground right now, that the planet’s going to get too hot and the consequences could be dire.”

A study published in the journal Nature in early 2015 took the stranded assets research further and identified those high-cost, high-carbon fossil fuel reserves that should remain unused given a global carbon budget. The study concluded production in Canada’s oilsands should drop to “negligible” levels by 2020 to remain within that 2 degree Celsius target.

That report was followed by a call to divest from fossil fuels from World Bank president Jim Yong Kim and reports from HSBC, Citibank and Standard & Poor, some of the world’s major financiers, on the financial risk of unburnable fossil fuels.

More recently a group of prominent scientists publicly called for a stop to further growth in Canada’s oilsands. The group argued adding new development in the oilsands goes against the recommendations of the scientific community when it comes to climate, ecosystems, species protection and indigenous rights.

So it appears on the issue of decarbonization, the Prime Minister doesn’t agree with anybody. Not even, erm, himself. 

Keith Stewart, Greenpeace energy and climate campaigner, and part-time faculty member at the University of Toronto where he teaches a course on energy and the environment, suggests this comes down to Canada’s “disconnect.”

“We want to do something on climate change but the minute you look at what that means, people say not that, not that,” Stewart said on the CBC’s The Current.

“There’s a fundamental dishonesty here, to tell the world Canada will play its role on climate change and then tell Canadians there will be absolutely no limit on the expansion of [the oilsands] sector,” he said.

“Nobody is talking about shutting it down tomorrow. This is about how much is it going to expand, what are we going to do over time and how are we going to phase this out over the coming decades because that is what Canada has committed to.”

Image Credit: Stephen Harper via Flickr

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Stephen Harper’s participation in the G7 leader’s declaration to decarbonize the global economy by 2100 was a massive headline generator in Canada, and not surprisingly so.

For a Prime Minister who has openly mocked the idea of carbon pricing, mercilessly driven an expensive (both financially and politically) energy superpower agenda and earned a reputation for pulling out of or stalling climate negotiations, the very idea of an ‘end’ to fossil fuels would seem … counterintuitive.

Although the shock of seeing Harper even touch something called ‘decarbonization’ is still reverberating, experts were quick to point out a long-term goal that shoves off concrete climate policy is likely just what Canada was hoping for.

Long-term Goals Are Easy

Michael Levi, senior energy and environment fellow writing for the Council on Foreign Relations, said the G7 agreement merely rearticulates what diplomats and policymakers have basically agreed to for several years now: dramatic emission cuts are required by mid century if we are to avoid surpassing the two-degree target.

“If the-two degree target didn’t motivate deep enough emissions cuts to actually meet it, recasting it in terms of global emissions won’t change that,” Levi wrote. “And the idea that an 85-year goal will have much impact on present policy or investment is a bit ridiculous. (Had you told a physicist in 1905 that a fifth of U.S. electricity would be generated by nuclear fission within 85 years, they would have said, ‘What’s a nucleus or fission?’)”

Levi said the bottom line is this: “Fiddling with distant targets is a great way to generate headlines, but doesn’t do much to affect policy and emissions themselves; at best it’s marginally irrelevant, at worst it lets people feel good without doing anything.”

Mark Jaccard, energy and climate economist from Simon Fraser University, agreed, saying the goal to end fossil fuels by 2100 makes it easy for politicians like Harper to detract from the short-term.

“Harper has gotten good at shifting timeframes, helped by a forgetful opposition, media and public,” Jaccard told DeSmog Canada. “His 2006 promise for reduced emissions in 2020 slides into a 2015 promise for reduced emissions in 2030. His 2007 promise for reduced emissions in 2050 slides into a 2015 promise for reduced emissions in 2100.

“It would be funny — like Lucy lying to Charlie Brown that she would hold the football — if it weren’t so tragic." 

Keith Stewart, climate and energy campaigner with Greenpeace Canada, said the G7 agreement does have the upside of legitimizing discussions around decarbonizing.

"The important thing here is that for the first time we have world leaders acknowledging that we have to ditch fossil fuels; not just reduce emissions at the margins, but go cold turkey on our fossil fuel addiction,” he said.

“Of course we'd be crazy to wait 85 years to do it. But it's now a question of when, not if, we go to a 100 per cent renewable energy system."

David Keith, professor of applied physics and public policy at Harvard University, who lives in Calgary, said the agreement does nothing more than score cheap political points.

“It’s not groundbreaking,” he told the CBC. “It is politically cheap to pledge a non-binding commitment that falls way behind someone’s time in office.”

“What we really need is specifics in the next few years or decades.”

Keith was one of more than 100 natural and social scientists who recently called for a moratorium on new projects in the Alberta oilsands, Canada’s fastest growing source of greenhouse gas emissions.

Canada’s Climate Target Weakest in G7

Environmental Defence recently gave Stephen Harper’s conservative party a ‘C’ on a climate scorecard, saying Canada currently has the weakest post-2020 climate target of all G7 nations (although Japan has yet to submit its plan).

Canada’s target to reduce emissions by 30 per cent from 2005 levels by 2030 was recently assessed as “inadequate” by the Climate Action Tracker, a coalition of four research institutions including Climate Analytics, Ecofys, NewClimate Institute and the Potsdam Institue. The groups determined Canada’s reductions targets will not be sufficient for Canada to do its fair share for the world to avoid dangerous climate change. 

In its report, Environmental Defence said Canada has shifted its climate targets over time as a way of appearing to do more than it actually is:

“The U.N. Framework Convention on Climate Change (1992) and the Kyoto Protocol (1997) both used 1990 as the reference or base year. Most countries still use 1990 as the base year but some have started using more recent base years. Since the Copenhagen summit in 2009, Canada has been using 2005 as a base year. This makes comparison between targets more difficult. It also makes targets look stronger than they are since Canada’s carbon pollution increased significantly between 1990 and 2005. For example, the Canadian government’s pledge to reduce emissions by 30 per cent below 2005 by 2030 is actually less than half as strong (-14.4 per cent) when expressed using 1990 as the base year.”

Environmental Defence adds Canada has consistently refused to address the Alberta oilsands when discussing climate targets, a subject of some controversy during last year’s UN climate talks in Lima, Peru.

Canada has pledged to regulate emissions from four sectors: natural gas-fired electricity, the chemical industry, methane emissions from the oil and gas sector and sources of hydrofluorocarbons.

For years the federal government has failed to deliver on its promise to regulate carbon from the oil and gas industry. Last year Harper said it would be “crazy economic policy” to regulate the oil and gas sector and indicated (incorrectly) that no other country was doing so.

Last year, Canada's environment commissioner Julie Gelfand said the country has "no overall vision" when it comes to oil and gas regulations and as a result will not even meet its 2020 international greenhouse gas reductions targets agreed to in Copenhagen.

Ed Whittingham from the Pembina Institute said he thinks industry will begin to pick up the slack, now that definitive dates for decarbonization are being discussed.

"We are all clear, we are still going to need fossil fuels for some time to come. Now we have, at the global level, the latest day for when we need to be off fossil fuels," he told the CBC. "CEOs in Calgary are smart; they will do the planning that needs to be done." 

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At an estimated 2,700 litres, the bunker fuel spill in English Bay was relatively small — yet the stakes of that spill couldn’t be much higher.

With Enbridge and Kinder Morgan both hoping to build oil pipelines to B.C., which would significantly increase oil tanker traffic in the province’s inside coastal waters, a dramatically mishandled marine oil spill raises all sorts of questions — questions the federal government does not appear well-positioned to answer, despite its aggressive push for West Coast oil exports.

“Obviously, from the oil industry’s perspective, you couldn’t have picked a worse place to have an oil spill,” Jim Stanford, economist at Unifor and founder of the Progressive Economics Forum, told DeSmog Canada.

While the federal government insisted its response was “world-class,” a former commander of the shuttered Kits Coast Guard station blamed the six-hour delay in even deploying a boom to contain the oil on the closure of that station in 2013 — a move that is reported to have saved the federal government at estimated $700,000 a year.

The English Bay spill, beyond being a systemic failure, has been a total PR disaster.

“It’s a very dramatic indication of the failure of our environmental safeguards around transportation and energy,” Stanford said.

Will The Real Energy Superpower Please Stand Up

Canada’s aggressive “energy superpower” push — a Harper government priority that has been accompanied by the elimination of environmental laws— has drawn criticism from all corners, and not just domestically.

The Obama administration indicated the fate of TransCanada’s Keystone XL pipeline, which has been caught in a protracted review process for six years, was intrinsically tied up with the oilsands’ growing greenhouse gas emissions. The European Union came close to labelling oilsand’s crude as high-carbon due to its energy-intensive extraction and refining process (that move was thwarted by intensive lobbying by the Canadian and Albertan governments). 

Back at home, the undercutting of environmental reviews and elimination of environmental laws has resulting in growing citizen concern about Canada’s oilsands development and record on climate change, as demonstrated by recent climate and pipeline protests.

Martha Hall Findlay, former Liberal MP and executive fellow at the University of Calgary’s School of Public Policy, says the federal government has blown the environmental file.

“You don’t poke people in the eye when the rest of the world is saying there are significant environmental concerns,” she said.

“I think it’s smart to acknowledge that and address it. Our current federal government has done the opposite in many ways. And, importantly, have been seen to be doing the opposite. There’s no doubt in anyone’s mind that it was a factor in Obama’s decision on Keystone.”

With Friends Like These Who Needs Protesters?

What’s become clearer is that such a myopic approach to policymaking has created difficult conditions for the extractive industries.

“The Harper government’s bloody-mindedness on environmental issues has actually done more to bog down large resource projects than anything the environmental movement could have done,” Rick Smith, executive director of the Broadbent Institute, said.

“What it’s done is make First Nations, local communities and environmentalists feel marginalized and angry.”

Keith Stewart of Greenpeace Canada echoed the sentiment, saying complaints are now likely to emerge from beyond the protest crowd: “If the government won’t listen to Canadians about it, they’re soon going to have to listen to our would-be customers.”

While there’s some significant progress occurring on the provincial front on the climate change file, that can’t make up for the lack of federal leadership.

“People outside Canada don’t necessarily understand the nuances of the different levels of governance within the country,” notes Anthony Heyes, University of Ottawa economics professor and Canada Research Chair in Environmental Economics. “Outsiders see it as a country that has a relatively disappointing record in not just greenhouse gas emissions in an absolute way, but also against international commitments..”

Hall Findlay added that if the federal government had followed the lead of the provinces, Keystone XL might have been approved. But at this point, piecemeal climate commitments from the provinces might not be enough.

An associated problem is the fact that Harper bet the economy on the success of the oil and gas sector (Thomas Walkom put it nicely in a piece for the Toronto Star: “Harper has his own unspoken industrial policy. It can be summed up in a word: pipelines.”)

Stanford suggests that such infatuation has come at the cost of other industries — manufacturing, tourism, transportation — due to the high dollar being pegged to an extremely volatile resource.

“You would have needed a government with the foresight and courage to actively push against that in order to protect our environment, obviously, but also our economic diversity and long-run prosperity instead of riding the bandwagon as they did,” he said.

Stanford notes that the employment rate is currently as low as it was in the summer of 2009, the worst moment of the global recession. That’s got to sting for a party that advertises its leader as a trained economist — not an elitist lawyer or under-qualified teacher.

Ultimately, Harper’s mismanagement of the energy and environment file — and most importantly the nexus of those two things — might be more of a gift than a burden for those who want to see progress on climate change.

“In a way, the fact that Stephen Harper has burned any semblance of federal environmental regulation to the ground is an opportunity for Canadians to rebuild something at the federal level that’s new, truly modern and forward thinking,” Smith says.

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Richard Kinder, Houston-based billionaire and CEO of Kinder Morgan Inc., told an industry audience last week the TransMountain pipeline expansion project “will go forward” if granted approval at the federal level, despite growing and very vocal opposition to the project in British Columbia.

Kinder said pipeline opponents are using “spurious arguments” to purposely strangle pipeline projects across North America as a means of fighting development in the Alberta oilsands.

“I am sure there are legitimate concerns about any mega infrastructure development, but a lot of this is [about] the pipeline as a choke point to get at production of the oilsands, which there are people in Canada and the U.S. who want to strangle that altogether,” Kinder said.

Kinder’s comments seem to affirm criticism that the company is refusing to take local opposition seriously.

“Rich Kinder's optimism shows he really does not understand B.C.,” Tzeporah Berman, adjunct professor of environmental studies at York University, told DeSmog Canada. “British Columbians love this coast,” she added, noting the recent bunker fuel spill in Vancouver’s English Bay “was a real wake up call.”

“Rich Kinder's confidence is surprising given Enbridge's Northern Gateway fiasco, the looming Supreme Court challenges to the National Energy Board’s pipeline review, the First Nations court cases and the polling showing that the vast majority of British Columbians are opposed to his project.”

The TransMountain review process has been fraught with tensions between the National Energy Board (NEB) and municipal authorities, environmental organizations and local First Nations.

Several major environmental organizations along with two opposition parties are calling on Premier Christy Clark to pull out of the federal review process. The call for withdrawal is supported by the Union of B.C. Municipalities, the Association of Vancouver Island and Coastal Communities and coastal First Nations.

Frustration with the review process has grown steadily in recent months, led in part by Kinder Morgan’s refusal to disclose information to intervenors. In addition, the NEB process prevented many members of the public — including climate scientists and other experts — from participating due to new exclusive rules.

“If the NEB really wanted to hear from British Columbians, why didn’t they design a process where our voices could be heard?” Caitlyn Vernon from the Sierra Club B.C. asked. “That’s why the B.C. government needs to step in and create a review that includes local voices, respects municipalities and First Nations, and considers the full impacts of Kinder Morgan’s proposal — especially its contribution to climate change.”

Keith Stewart, climate and energy campaigner with Greenpeace Canada, said Kinder’s recent claim points to a sense of entitlement prominent within industry.

"It is indicative of the hubris of the oil industry that CEOs assume that they have a right to build what they want and where they want,” Stewart said.

“Mr. Kinder is not only underestimating the depth of opposition to his new pipeline, but he also doesn't seem to understand that concern over climate change isn't going to go away." 

Eoin Madden from the Wilderness Committee said Kinder’s strong position is purely a matter of corporate posturing.

“To be honest, I don't think Rich Kinder lacks respect for the seriousness of pipeline opposition here in B.C.,” Madden said. “His role at Kinder Morgan demands that he publicly appear confident and supportive of the TransMountain pipeline project regardless of whether or not his moral and business sense screams that it’s a dead project."

He added the conversation around Enbridge’s Northern Gateway pipeline played out in a similar way.

However, Madden said, “I do think Kinder is purposely blind to the public interest in this issue. Why? Because he is paid large amounts of money to be.”

But things may be different after the English Bay spill, Madden said. 

“One thing remains crystal clear in its aftermath: folks in this part of the world care deeply about the Salish Sea, and seeing those waters sullied really hurt.”

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