As part of the review, the Government will appoint two expert
panels to examine the environmental assessment process, the role of
the National Energy Board (NEB), the Fisheries Act, and
the Navigation Protection Act. There will also be a 30-day
window for the public to comment on the mandates of the two expert
panels. The Government has indicated that consultations will be at
the core of this process and that the expert panels will be given a
January 31, 2017 deadline to render their recommendations. Until
then, the interim rules for resource projects will guide decision
making on existing projects such as the Energy East pipeline.
The Government's announcement and the impending overhaul of
Canada's regulatory laws stem from the 2015 Liberal Party
campaign commitment to restore public trust and credibility in the
approval process for energy projects. The Government has committed
to reviewing the previous Government's changes to the
Canadian Environmental Assessment Act, the Fisheries
Act, and the Navigable Protection Act and, will
likely seek to restore and enhance regulatory measures in those
However, the Government has not provided details on what these
changes may look like or when they will be implemented. While it
will take until 2017 for the expert panel to release its
recommendations, there will be significant time needed for the
Government to prepare and implement legislative changes. Given the
priority of this campaign commitment, the Government will likely
introduce legislation prior to the next federal election.
The chief implication of this announcement is the increased
delays and uncertainty that the review process will create.
Additional delays and increased regulatory hurdles – the
scope of which are largely unknown – send a signal to the
energy sector and investors that uncertainty, delays, and more
process can be expected for large resource projects.
It is further unclear whether the interim rules, review process,
and eventual overhaul will have the desired effect of restoring
public confidence in the approval process for pipeline projects
like Energy East. Will more regulation in the environmental
assessment process and the NEB lead to more confidence in the
Another important implication for current and future projects is
what role the NEB will be given in what has become a politicized
process. As of now, Cabinet currently holds the authority to
approve or deny projects, regardless of the NEB's
recommendation. Recently the NEB recommended approval of the Kinder Morgan
Trans-Mountain pipeline (Trans-Mountain), subject to 157
conditions. Cabinet is expected to make a decision on this project
on December 19, 2016. The question then is whether Cabinet will
accept the NEB's recommendation or reject the project on
political grounds? With the recent legal challenge by the City of Vancouver
and First Nations groups to the Trans-Mountain approval,
Cabinet's decision in the face of legal battles and public
opposition may be an indication of the Government's approach to
large interprovincial resource projects. Will it be politics or due
The finer details of this review should become clearer once the
expert panels release their recommendations. In the interim,
project proponents and investors are advised to participate in the
review process and follow the panels' activities closely.
Ontario's Ministry of the Environment and Climate Change continues to roll out its Climate Change Action Plan with its proposed GHG guide for projects that are subject to the province's Environmental Assessment Act.
The Imperial Oil refinery pled guilty to one offence for discharging a contaminant, coker stabilizer, thermocracked gas, into the natural environment causing an adverse effect and was fined $650,000...
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