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Varcoe: As bitumen battle moves to B.C. court, turning off taps remains ultimate option

Varcoe: As bitumen battle moves to B.C. court, turning off taps remains  ultimate  option
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Remember the wine ban, British Columbia’s brazen attempt to block more bitumen from entering the province and Alberta’s threat to turn off the oil taps in retaliation?

It all seems so 2018.

It may be forgotten, but it’s certainly not gone.

While political attention in Alberta focused Monday on the throne speech, the kamikaze candidate imbroglio and a looming election call, a high-stakes legal case was playing out in front of the B.C. Court of Appeal.

The issue has immense consequences for Alberta’s energy industry: Does the B.C. government have the power to limit heavy oil moving into that province, despite federal authority to regulate cross-border railways and pipelines?

“Obviously that is a critical case,” Premier Rachel Notley said Monday.

“Quite honestly, if the government of B.C. were to be successful in this reference case — which, to be clear, I really don’t think they will be — but if they were, then I think really all bets would be off, in terms of provinces working together and trading with each other.”

On one side of the Rocky Mountain divide sits B.C. Premier John Horgan, whose NDP government has previously vowed to use “every tool” in its tool box to stop the Trans Mountain pipeline expansion (TMX) from going ahead.

On the other sits the federal government, owners of the pipeline to the Pacific coast, along with the oil-producing provinces of Alberta and Saskatchewan.

They’re arguing in the reference case to the courts that B.C. does not have such authority under the Constitution.

B.C. maintains the proposed amendments to its Environmental Management Act are designed to protect the province from the risks of a spill due to the increased shipment of diluted bitumen from Alberta.

The over-arching question in the case is “the extent to which our federal constitution will permit the province to protect its people, its land, its water,” B.C.’s lawyer, Joseph Arvay, said in his opening remarks.

“The province has no axe to grind against pipelines or rail — it’s about the environmental harms of the bitumen.”

B.C. doesn’t just have an axe to grind, it’s been trying to wield a pitchfork against the Trans Mountain project for more than a year.

As Ottawa argues in its submissions, the legislation is an attempt to regulate interprovincial undertakings, which fall exclusively under Parliament’s jurisdiction.

The real reason for this case is politics.

“On multiple occasions, members of the B.C. government made statements to the effect that they are opposed to the TMX project,” according to a submission from the federal government.

“The true purpose and effect of the proposed legislation is to create a ‘tool’ for B.C. that can . . . impede additional heavy oil originating in Alberta from being transported through B.C. generally and . . . frustrate the TMX project specifically.”

The B.C. government, having received advice it doesn’t have the power to directly stop Trans Mountain, is now attempting to achieve the same objective indirectly, Alberta argues in its submission.

And this is why the case has angered so many Albertans, going back to the brief ban on B.C. wines coming into this province last year.

In every direction, pipeline projects to move crude out of Alberta have bogged down.

Federal approval of the Trans Mountain pipeline was quashed last August due to Ottawa’s bungling of consultations with First Nations, and the NEB’s improper consideration of the project’s marine effects.

The Trans Mountain legal mess sits in Ottawa’s lap and must be rectified.

In Alberta, the political dimension around pipelines is bubbling like a pot of water on a hot stove.

As Mount Royal University political analyst David Taras points out, Albertans are hurting due to the economic slump and inability to build pipelines.

He believes there would be “visceral reaction” by Albertans in favour of throttling back the oil shipments to B.C. if the broader dispute isn’t resolved.

“My sense is there’s an exploding anger looking for a place to go,” Taras said.

“It is kind of a cry for help. We want to exert some control of our own destiny.”

Under Bill 12 passed last year, Alberta’s energy minister has the discretionary power to require companies to obtain a licence to export oil, natural gas or refined products out of Alberta.

If Horgan’s government doesn’t want more Alberta oil crossing its boundaries, how about a whole lot less?

Such action might feel good, although it seems just as likely Alberta and the feds will win this reference case at some point, say legal experts.

University of Calgary law professor Nigel Bankes thinks B.C.’s case is a long shot as federal regulation of interprovincial pipelines is all encompassing.

“I think B.C. will not succeed on these reference questions, that’s my prediction,” he said.

As for turning off the taps, that’s still an option for the Alberta government once the spring election is wrapped up and the legal cases are finally decided.

In Edmonton on Monday, Notley said all bets would be off if B.C. succeeds in its quest.

United Conservative Party Leader Jason Kenney said if his party wins the spring election, he would want to meet with Horgan first before taking any action.

“I think there are multiple pressure points. Turning off the taps is not the only one. But it is the ultimate one,” he said.

As frustration mounts in this province over the country’s pipeline paralysis, that might be one of the few options left for Albertans growing angry with the long wait.
Read more on calgaryherald.com
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