The battle against the Kinder Morgan Trans Mountain pipeline could lead to the next Standing Rock and destroy any investment case for the project, according to a newly released report.

The report, commissioned by the Secwepemc nation and prepared by the Indigenous Network on Economies and Trade, is titled “Standing Rock of the North: The Kinder Morgan Trans Mountain Pipeline Expansion Secwepemc Risk Assessment.”

Over the course of 35 pages, it articulates seven ways that Kinder Morgan Canada has failed “to account for the lack of political, legal, and proprietary certainty surrounding the pipeline.”

“The government has to follow the minimum standards laid out in the United Nations Declaration on the Rights of Indigenous Peoples — that includes free, prior and informed consent, which they have not gotten from us for the project,” Kanahus Manuel, member of the Secwepemc Women Warrior Society and daughter of the late Art Manuel, told The Guardian.

“Instead Kinder Morgan is hiding the risks and the costs their backers will face when this pipeline doesn’t get built.”

Canada and B.C. have both committed to implementing the United Nations Declaration on the Rights of Indigenous Peoples, also known as UNDRIP. A central component of UNDRIP is an adherence to “free, prior and informed consent,” meaning consent that is attained without coercion or manipulation, with plenty of notice and makes sure that detailed information is provided. There’s plenty of debate in Canada about how UNDRIP can actually be implemented, but in the meantime governments are talking the talk without always walking the walk.

Here’s a breakdown of the key points.

1) Kinder Morgan Underestimates the Likelihood of Direct Action by Secwepemc Nation

The proposed Trans Mountain expansion pipeline (referred to as TMEP in the report) would transport 890,000 barrels of oil per day from Edmonton to Burnaby and plans to cross 518 kilometres of Secwepemc territory, which accounts for about half of the pipeline’s entire length.

The problem?

The Secwepemc nation never ceded, released or surrendered their land to the British Crown or Canadian state. That’s the case in much of British Columbia. The original pipeline was first built in 1951, when Indigenous peoples weren’t allowed to organize on land issues or hire lawyers.

But it’s now 2017. And that matters a great deal given the Secwepemc nation unreservedly opposes the pipeline.

ICYMI: Canada’s Implementation of UN Declaration on Indigenous Rights Raises Questions About Oilsands, Resource Extraction

In June, the nation declared: “We the Secwepemc have never provided and will never provide our collective consent to the Kinder Morgan Trans Mountain Pipeline Project. In fact, we hereby explicitly and irrevocably refuse its passage through our territory.”

The Secwepemc have a very lengthy track record of fierce resistance and direct action. In 1995, sundancers and other land defenders engaged in a month-long standoff with 400 RCMP officers, now known as the Gustafsen Lake standoff.

Other examples of resistance include the Sun Peaks Resort camp from 2000 to 2010, the Women Warrior Society camp in 2015 against Imperial Metals following the Mount Polley mining disaster and ongoing opposition to KGHM’s Ajax Mine.

Secwepemc people are more than ready to fight to protect their lands and waters.

“In their words, the pipeline will never be built,” said report co-author and economist Troy Cochrane in an interview with DeSmog Canada.

“They will not allow it to come onto their land. If we’re taking them at their word, then the pipeline is doomed from the get-go. If the government is going to respond to this on-the-ground confrontation of the pipeline coming onto the territory, who knows where that could go. I shudder to think about those possibilities.”

Protestors at Standing Rock faced violent clashes with private security forces. Photo: Dark Sevier via Flickr

2) There’s Enormous Legal Risk to Trying to Ram Through a Pipeline

There are currently 18 distinct legal proceedings against the project.

That includes six against the National Energy Board’s recommended approval, nine against the decision by the federal cabinet to approve it, three against the B.C. government for its decision to accept the federal review process and another two from Indian Tribes in Washington State for potential impact of significantly increased tanker traffic on endangered southern resident killer whales.

The first round of hearings started in early October in front of the Federal Court of Appeals. Because of the size of the case, it includes over 10 applicants including seven First Nations. As noted in the report: “The legal risks for the proposed Kinder Morgan TMEP therefore are extremely high.”

Another related aspect emphasized in the report is that Secwepemc people operate with a “principle of collective land tenure” that contradicts Western conceptions of land ownership.

Because Kinder Morgan and the various levels of government only consulted with elected band councils as opposed to the collective nation, the report contends they “failed at the most basic and primary threshold when it comes to negotiating with the proper title and rights holders to discharge constitutional obligations.”

Throw in the landmark 2014 Supreme Court of Canada case between the Tsilhqot’in Nation and British Columbia, and there’s a pretty strong argument to be made that the legal system could make Kinder Morgan’s life very difficult.

3) The Economics for New Pipelines Are Pretty Awful Right Now (see: Energy East)

It was less than two weeks ago that TransCanada cancelled its massive proposed Energy East Pipeline, mostly due to sustained low oil prices.

The same fate could befall Kinder Morgan’s project.

“Historically, pipeline companies have been considered relatively safe, stable investments,” the report noted. “However, since 2015, the market has treated pipelines as a riskier investment.”

This has had direct consequences for Kinder Morgan’s revenue, which peaked in 2014 and has been dropping ever since. But the report contends that the economic situation could get much more dire for Kinder Morgan following the “Secwepemc’s assertion that they will defend their land, and the recently launched Tiny Houses campaign.”

Every month that the project is delayed costs the company over $5.6 million. In addition, the total anticipated project cost has increased by almost a full one-third, from $5.4 billion in 2012 to $7.2 billion last year.

“Whether Kinder Morgan knows or is ignorant, the actual risk associated with investments in this project are totally out of line with what the real risks are, and the real risks are all compounded by the realities of Indigenous land rights and the possibility of direct action to defend their territory,” Cochrane said.

4) Changing Governments Have Completely Changed the Game

The BC Liberals went to bat for the Trans Mountain pipeline for many years.

Sure, it committed in early 2016 to requiring five key conditions be met before allowing it to proceed. But despite having the opportunity to order a provincial environmental assessment, it chose to accept the federal National Energy Board’s assessment as its own through an “equivalency agreement.”

That meant that it gave up the chance to seriously re-evaluate the environmental ramifications of the project.

How times have changed. The newly elected B.C. NDP government, propped up by the provincial Greens, have committed to doing everything it can to stop the Kinder Morgan project. In August, the new government announced it was seeking intervener status in legal challenges to the project, appointing the legendary lawyer Thomas Berger to head up the charge.

In addition, the new government has pledged to implement the United Nations Declaration on the Rights of Indigenous Peoples (although, to be fair, both the federal Liberals and Alberta NDP have done the same without much to show for it).

As the report put it: “The political terrain is shifting rapidly in the province and Indigenous peoples are positioned to play a central role.”

Will #KinderMorgan‘s #TransMountain #Oilsands Pipeline Become the #StandingRock of the North? https://t.co/Foalru9aXK #cdnpoli @james_m_wilt

— DeSmog Canada (@DeSmogCanada) October 18, 2017

5) Kinder Morgan Could Take a Massive Reputational Hit

Names like TransCanada and Enbridge have become well-known in Canadian water cooler talk.

Same goes for Kinder Morgan. Especially since Trudeau appointed a ministerial panel to review the project and  subsequent ignored all of its incisive recommendations.

“Kinder Morgan’s plan to build a pipeline that passes through Indigenous territory, and also a densely populated city known for its environmentally conscience citizens, puts the company at the centre of these conflicts,” the report argues. “By doing so, it has become one of a handful of pipeline companies that are household names.”

A continued push to build the pipeline by Kinder Morgan could add to that negative reputation, especially in the face of fierce Indigenous opposition and potential police or military intervention as implied by Natural Resources Minister Jim Carr.

More negative attention could lead to more public pressure to cancel the project, itself impacting the economic bottom line.

6) Modernizing Environmental Assessments Could Add Even More Pressure

The Kinder Morgan pipeline received a recommended approval from the National Energy Board, and the go-ahead from federal cabinet.

But the report contended that impending overhauls of the National Energy Board, Canadian Environmental Assessment Agency and Fisheries Act could have an impact on the pipeline.

That’s especially given the federal government’s announcement of “interim review principles” in January 2016, which included a commitment to “undertake deeper consultations with Indigenous peoples and provide funding to support participation in these consultations.”

This creates what the report dubs a “significant risk” for the project given the failure to uphold that commitment.

“Changes to legislation are expected sometime in the fall of 2017 and there is evidence to suggest that they will have a significant influence on subsequent decision-making and licensing processes related to the TMEP and route approval process — especially where Indigenous rights, title, jurisdiction, and consent are involved,” the report said.

Protesters and members of the RCMP clashed near the site of survey work for the Trans Mountain pipeiine being conducted on Burnaby Mountain, November 2014. Several protesters were arrested. Photo: Mark Klotz via Flickr

7) Trans Mountain Would Include Huge Climate-Related Risks

In May, Greenpeace Canada filed a complaint with the Alberta Securities Commission about Kinder Morgan’s disclosure of climate-related risk.

It was the first such submission in Canada, following in the wake of Occidental Petroleum being required by asset manager BlackRock to disclose such risks. Adam Scott of Oil Change International said that he’s also watching closely for the full report by the Canadian Securities Administrators on climate change risk disclosure practices.

Such pushes also helped establish the groundwork for the final reason in the report: that Kinder Morgan’s pipeline will directly undermine Canada’s climate targets. As recently reported by the commissioner of the environment and sustainable development, Canada is currently projected to overshoot its 2030 target by 55 per cent.

Barring incredible technological innovations that cut per-barrel emissions, it seems impossible at this point for the country to do anything but stabilize and then decrease oilsands production. As a result, this threatens fossil fuels with the potential future status of “stranded assets,” meaning that investors will massively lose out if climate targets are taken seriously.

“When Canada gets serious, the Kinder Morgan TMEP will never pass inspection if run through the climate change global and national commitments necessary to save the planet as an inhabitable place for all,” the report concluded.

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Whether it was an act of God or the fault of negligent mine operators, the cause of Mount Polley mine spill — the worst mining disaster in Canadian history — remains officially undetermined, leaving local residents in a frustrated state of limbo.

One year ago this week the Mount Polley mine tailings impoundment collapsed, sending a catastrophic 24 million cubic metres of contaminated mining waste down the Hazeltine Creek and into Quesnel Lake, a local source of drinking water and in peak years can host up to 60 per cent of the province’s sockeye salmon run.

The province of B.C. says the Mount Polley Mining Corporation, owned by Imperial Metals, is still under investigation although some fear a January report that found glacial silt responsible for the instability of the collapsed tailings pond may take culpability away from the company.

Kanahus Manuel, a local indigenous activist and member of the Secwepemc First Nation, said the province’s decision to approve a partial re-opening of the Mount Polley mine last month signals to the media and the public that the company is without blame.

“The province giving the permit to Mount Polley was very irresponsible,” she said. “Mount Polley still under investigation and they haven’t cleaned up this disaster.”

Manuel doesn’t believe the reason for the tailings pond collapse was due to the presence of glacial silt.

“According to the people who worked here at the mine it was negligence. The dam wasn’t built properly and the company was not giving workers the proper material, the rock material, they needed to stabilize it.”

“That needs to be addressed,” she said. “They’re getting away with it."

Long-term Impacts of Mount Polley Spill Unknown

Manuel said she marked the one-year anniversary of the spill at a protest at the entrance to the mine with about 100 other individuals from as far away as Vancouver and Montreal.

“It’s very distressing to us as salmon people,” Manuel added, saying local fishermen attended the gathering to feed participants salmon.

“People still have these emotions about the disaster, not knowing what the cumulative impacts and the impacts on the salmon will be in years to come.”

Manuel said she is concerned about the movement of the mining waste through the food chain. “You’ve seen it, the sediment is pulverized into tiny particles. Those are the particles that are going into the food chain and will bioaccumulate in our bodies.”

Fine waste material from the tailings pond on the author's boots, August 11, 2014. Photo: Carol Linnitt.

Sam Albers, manager at the Max Blouw Quesnel River Research Centre, is studying the long-term impacts of the spill on aquatic species and said the effects of the spill will take time to show up in the data.

Albers said the spilled material contains heavy metals like copper and selenium but some of the metals are likely still bound up in rock material. The question is how effectively the metals are dissolving in the water and how that will affect fish over the long term.

"The big concern is that copper and salmon really don't mix all that well,” he said.

"Specifically, dissolved copper and salmon don't mix well. It can get into their olfactory system — so the fish equivalent of a nose — and really mess with their ability to utilize their ecosystem properly."

Albers explained the one-year anniversary of the spill is significant for scientists collecting data, because it allows for "more comparing apples to apples."

"We can now compare August sixth data from this year to August sixth data from last year. That will help us develop that longer-term time series which is critical to being able to comment on the impacts."

Sediment-laced water can be seen flowing into Quesnel Lake at the base of the rebuilt Hazeltine Creek. Photo: Farhan Umedaly.

Fisheries biologist and local resident Richard Holmes said he is also concerned about the impact of the spill on fish species.

“I think the impacts will be long-term but we just don’t know how severe they will be,” he said.

“Especially for the fishery resources, the biggest concern for Quesnel Lake is the sockeye salmon.”

No Disaster Relief for Victims of Spill

Holmes said he is glad attention is being paid to the environmental impacts of the spill although he said he is “disappointed” the company and the province were so eager to get the mine up and running again. The Ministry of Environment approved a permit for the mine to partially restart operations in June.

Holmes said the mine and the province acted “like they’d just won the lottery.”

“I was insulted, actually.”

“They’ve forgotten completely about the social impacts and the cultural and economic impacts on the people in the community,” he said.

He added that a recent flood in Cache Creek has received much more immediate attention from the province which stepped in with disaster relief funds for the community.

“That has never been offered here,” he said.

The province did provide $50,000 to the Likely Chamber of Commerce after the spill occurred but Holmes said that amount was inadequate. “That works out to $143 per person for a year of dealing with this disaster.”

Richard Holmes near his home in Likely, B.C. Photo: Carol Linnitt

He said because the investigation into the Mount Polley spill is still ongoing, the community is struggling to stay afloat without compensation.

“The government can’t have it both ways. Either there is somebody to blame who must pay. Or if nobody is to blame then the government needs to step in,” he said.

Local eco-tourism operator Gary Zorn also expressed frustration at the lack of compensation for Likely residents and business owners.

“What’s the difference between here and what happened here and in Cache Creek?” Zorn said.

“Cache Creek has a huge disaster, a natural disaster, and the government rushes there and gives everybody there up to $300,000 and here we have a massive mining disaster and the government gives them a start up permit.”

Zorn and his wife Peggy said their eco-tourism business, which offers grizzly-watching adventures, lost hundreds of thousands of dollars the day the Mount Polley disaster occurred.

“How come the government doesn’t say, ‘hey you guys, you created some real issues here, there’s some businesses you really did dirt to, you really hurt them. You straighten that mess out too.’”

“Or is the government to blame too?" Zorn said. "I mean, what’s going on here. How do you keep passing the buck and promising lies and lies and lies?”

“Who Will Pay the Bill?”

The province is currently conducting two investigations into the Mount Polley mine spill through the Conservation Officer Service and the Chief Inspector of Mines.

“We will ensure that those responsible are held accountable,” a spokesperson for the Ministry of Environment said.

Ugo Lapointe, Canada program coordinator for MiningWatch Canada, said it doesn’t make sense to restart the mine with two investigations pending.

“The ongoing investigations could lead to serious civil and criminal charges against Imperial Metals or its contractors, which in turn could lead to severe or very costly sanctions or litigations,” Lapointe said. “This critical information should be made publicly available before even thinking of reopening the mine.”

In a video released by the province to mark the one-year anniversary of the spill, Steve Rothman, senior inspector of mines from the Ministry of Energy and Mines, said, “the province would like to see the mine back in operation and in a safe and environmentally-conscious program that takes all the workers back to work and helps support the community.” 

But Lapointe echoes the concerns of the community: “Again we seem to be repeating the same mistakes as before by prioritizing the company’s economic interests over safety and the environment. This is really about getting Imperial Metals back to profitability.”

“We are very concerned of the lack of detailed assessments of the costs and damages caused so far by this massive failure onto the local environment, communities, and businesses, as well as onto First Nations’ right and livelihoods in the area,” Lapointe said.

“Who will ultimately compensate and pay the bill for all of those damages? The persistent blanket of silence on this issue is very worrisome.”

Image Credit: The reconstructed base of the Hazeltine Creek and Quesnel Lake. Photo: Farhan Umedaly.

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.