Canada: Northern Gateway Pipeline Requires Provincial Environmental Approval

Last Updated: January 22 2016
Article by Paula Boutis

A BC court has declared that an agreement (Agreement) between the British Columbia Environmental Assessment Office and the National Energy Board is invalid to the extent it purported to remove the need for an environmental assessment approval under BC's Environmental Assessment Act (EAA).

The court also declared the province of British Columbia had a duty to consult with the Gitga'at First Nation, and it failed to do so, regarding the Northern Gateway Pipeline Project (Project).

Constitutional Question: Who's in Charge?

As a preliminary question, the court was faced with a constitutional question. The Project proponent, Northern Gateway Pipelines Limited Partnership (Proponent), argued that a provincial environmental assessment could not apply at all in this situation, because the Project was a federal undertaking, making it the exclusive jurisdiction of the federal government.

The court concluded the province could not go so far as to actually refuse to issue an environmental assessment certificate in the face of an approval at the federal level; but it did not agree that the EAA had no application. The court concluded that matters relating to the environment are shared jurisdiction and the EAA is valid legislation, even in relation to an interprovincial undertaking.

The court noted that it is important to give effect to validly enacted provincial laws unless they interfere with the core functioning of a federal undertaking. There is room for the province to issue an approval with additional conditions, beyond or different from those already issued through the federal environmental assessment. This is possible so long as those conditions do not have the effect of saying "no" where the federal government has said "yes". Any determination of whether the province's decision is appropriate within our constitutional framework would have to wait to another day, however, since the province had not yet made any decision under the EAA.

Province Cannot Abdicate its Legislated EAA Mandate

In 2008 and in 2010, the BC Environmental Assessment Office and the National Energy Board entered into agreements regarding all reviewable projects (as defined under the EAA), where those projects required both EAA and National Energy Board Act approval.

The impugned Agreement authorized environmental assessments occurring through the federal process to be accepted for provincial assessment purposes. However it went one step further: not only would the environmental assessment itself be deemed equivalent, but so too would the actual approval decision by the federal government.

After dispending with the constitutional argument, the court turned to a lengthy statutory interpretation exercise, and concluded that authorization in the EAA to allow for an equivalent environmental assessment did not authorize another level of government to usurp the decision-making function of the province under the EAA. BC would have to make its own decision under the EAA.

Duty to Consult First Nations

The law on the duty to consult is now well defined. The duty arises when (1) the Crown has knowledge of the potential existence of an Aboriginal claim or right; (2) there is contemplated Crown conduct; and  (3) that conduct has the potential to adversely affect an Aboriginal claim or right.

This duty is not divisible. Each level of the Crown – provincial or federal – has its own independent obligations. The provincial Crown cannot say that because the federal Crown also has a duty to consult, as it did in this case, that the federal government can discharge its duty and the province's. The province must attend to its own obligations.

In addition, the court reiterated that consultation entails early and meaningful dialogue. It does not mean explaining, however respectfully, what actions the government is going to take that may or may not address potential adverse effects.

The court concluded that the province failed to consult with the First Nations in question when it knew that they had raised concerns about the Agreement; and, in particular, when they sought to have the province terminate the Agreement, as the province was entitled to do.

Termination would have allowed the province to impose further conditions on the Project.  Specifically, the province could, through its own approval process, require as a condition that the Proponent include the province's version of world-leading spill response on land and marine environments. The province, as intervener in the federal assessment review process, "demanded" this condition in its submissions, but this condition did not form part of the conditions imposed through that process.

The Northern Gateway Project, like all pipeline projects currently underway or proposed, are under significant scrutiny. They are viewed by the environmental community and First Nations as entrenching an energy infrastructure which relies on fossil fuels, and which therefore exacerbates climate change. We can expect to see more of this type of litigation where pipeline approvals are in play.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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Paula Boutis
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