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Trans Mountain Pipeline ULC Trans Mountain Expansion Project – Review of Decision MH-003-2018 Issued to 1054408 BC Ltd. in Detailed Route Hearing, CER Decision MH-001-2020

Link to Decision Summarized

Pipeline – Routing


Background

On 16 December 2013, Trans Mountain Pipeline ULC (“Trans Mountain”) applied with the National Energy Board (“NEB”) under section 52 of the National Energy Board Act (“NEB Act”) for a certificate of public convenience and necessity (“Certificate”) authorizing the construction and operation of the Trans Mountain Expansion Project (“TMEP”).

The TMEP includes twinning the existing 1,147-kilometre-long Trans Mountain Pipeline (“TMPL”) system in Alberta and British Columbia (“BC”) with approximately 981 kilometres of new buried pipeline; new and modified facilities, such as pump stations and additional tanker loading facilities at the Westridge Marine Terminal in Burnaby; and reactivating 193 kilometres of the existing pipeline between Edmonton and Burnaby. Trans Mountain requested approval of a 150-metre-wide corridor for the TMEP pipeline’s general route.

Upon receipt of the application, the NEB commenced a public hearing process (“Certificate Hearing”). Following the Certificate Hearing, on 19 May 2016, the NEB issued its Report recommending that the Governor in Council (“GIC”) approve the TMEP and its general pipeline corridor. The TMEP was approved by Order in Council (“OIC”) in November 2016. The NEB issued Certificate OC-064 and began work on various regulatory processes, including the 2017/18 detailed route approval process.

On 27 July 2018, the NEB released its decision in Detailed Route Hearing MH-003-2018 pertaining to 1054408 BC Ltd.’s lands (“2018 Decision”).

On 30 August 2018, the Federal Court of Appeal (“FCA”) issued its decision in Tsleil-Waututh Nation v. Canada (Attorney General) (“FCA Decision”), setting aside the OIC and remitting the matter back to the GIC for appropriate action. Following the FCA Decision, the NEB reconsidered the matter of TMEP-related marine shipping, and the Government of Canada reinitiated consultations with Indigenous peoples.

Following a second public hearing process, the NEB issued its Reconsideration Report in February 2019. Canada’s Crown Consultation and Accommodation Report was issued in June 2019. The GIC approved the TMEP again in June 2019 via OIC, and the NEB subsequently issued Certificate OC-065.

On 19 July 2019, following a public comment process, the NEB set out how it would resume the TMEP detailed route approval process. The NEB directed Trans Mountain to file its Plan, Profile and Book of Reference (“PPBoR”) for the entire TMEP route. Pursuant to section 34 of the NEB Act, Trans Mountain served landowners along the length of the TMEP with a notice that the detailed route approval process was underway, and placed notices in local publications. The notices indicated that landowners and Indigenous peoples with a continued or new objection to the proposed detailed route, or to the methods or timing of construction, were required to file a statement of opposition (SOO).

The NEB said that, in cases where a detailed route hearing decision had been issued, and a valid SOO was filed, a review of the prior decision would be conducted. To be considered valid, an SOO had to:

  • be filed on time, made in good faith, not withdrawn, and not frivolous or vexatious; and

  • identify a material change in circumstances related to the best possible detailed route of the pipeline, or the most appropriate methods or timing of constructing the pipeline.

On 28 August 2019, the Canadian Energy Regulator Act (“CER Act”) came into force, repealing the NEB Act. As of that date, the Commission of the CER considered approval of the PPBoR under the CER Act.

Review of the 2018 Decision

In its 2018 decision, the NEB found Trans Mountain’s proposed detailed route to be the best possible detailed route (the “2018 Decision”). It also found Trans Mountain’s proposed methods of construction (including the amount and location of temporary workspaces) and its proposed timing of construction (June to September 2019) to be the most appropriate. On 5 September 2019, 1054408 BC Ltd. filed an SOO in which it raised objections to the methods and timing of construction.

In a procedural direction, the CER set out the scope of the review. The CER found that 1054408 BC Ltd. had identified a material change in circumstances that raised a doubt as to the correctness of the 2018 Decision concerning the timing of construction. Since no material change was raised concerning the methods of construction, the only issue to be decided in this review was whether the 2018 Decision, as it related to the timing of construction, should be confirmed, amended, or overturned.

The NEB’s full finding concerning the timing of the TMEP’s construction reads as follows (emphasis added):

As discussed in evidence, Trans Mountain must obtain an authorization from [Fisheries and Oceans Canada (DFO)] for the Coquihalla River crossing, and there is a least-risk activity window of August 1-31 in any given year to conduct it. Preparation work will need to be done on 1054408 BC Ltd.’s lands in advance of the crossing, and clean-up activities following it. To avoid disrupting the lands a second time, the [NEB] is of the view that work to install the TMEP pipeline on 1054408 BC Ltd.’s property should be done at the same time as the river crossing. Accordingly, the Board finds that the most appropriate timeframe for pipeline construction on 1054408 BC Ltd.’s lands is between June and September.

The necessary authorizations, including this detailed route approval, were not provided to Trans Mountain in time to conduct crossing- or pipeline-related work on 1054408 BC Ltd.’s lands in August 2018. While the August 2020 timeframe is possible from a regulatory perspective, the Board is of the view that, from a constructability perspective, pipeline construction on 1054408 BC Ltd.’s lands must precede construction of the residential development. The [NEB] agrees with Trans Mountain that the river crossing will not be feasible if the workspace becomes unavailable through development by 1054408 BC Ltd. The [NEB] also recognizes Trans Mountain’s concerns around additional excavation and storage of material if fill has been added to the lands as part of requirements for 1054408 BC Ltd. to implement flood-proofing measures for the residential development.

For these reasons, the [NEB] finds that June to September 2019 is the most appropriate timing for the TMEP’s construction on 1054408 BC Ltd.’s property.

Because of the delay due to the FCA Decision and subsequent approval steps, Trans Mountain was unable to construct from June to September 2019 and sought an amendment so that it could construct from June to September 2020. 105448 BC Ltd. argued that its planned residential development was being impeded by TMEP. It further argued that Trans Mountain’s request for an amendment to extend the year of construction from 2019 to 2020 be denied.

Decision of the CER

Should the NEB’s Decision That June to September Is the Most Appropriate Timing of Construction Be Confirmed, Amended, or Overturned?

The CER noted that it is an expert tribunal overseeing Trans Mountain’s compliance with respect to TMEP-related river crossings. In this capacity, the CER is aware that the least-risk activity window to which Fisheries and Oceans Canada limits construction, in this case, has not changed.

The CER was of the view that conducting the river crossing during the least-risk activity window is important to protect fish and fish habitat, which is the very intent of such a window. The CER also continued to be of the view expressed in the 2018 Decision that pipeline construction on 1054408 BC Ltd.’s lands should be done at the same time as the river crossing (which involves preparatory and post-construction work on 1054408 BC Ltd.’s lands) in order to avoid disrupting the lands a second time. Accordingly, the CER confirmed the 2018 Decision that June to September is the most appropriate timing of construction.

Should the NEB’s Decision That 2019 Is the Most Appropriate Timing of Construction Be Confirmed, Amended or Overturned?

The CER was of the view that the inclusion of the year in the 2018 Decision was based on the premise that pipeline construction should precede 1054408 BC Ltd.’s Phase 2 construction in the first June to September period that was available. At the time of the 2018 Decision, this meant the year 2019. There was no question that the TMEP’s construction on 1054408 BC Ltd.’s lands could not have occurred in 2019, given the FCA and NEB decisions that followed the 2018 Decision. Further, as a matter of common sense, the CER cannot require the construction to take place in the past.

Trans Mountain requested that the year of construction be amended to 2020. The CER noted that Trans Mountain must obtain any necessary authorizations and approvals from all relevant regulators and government offices in order to begin its construction activities. The CER agreed with 1054408 BC Ltd.’s submission that the requirement to obtain these approvals may interfere with pipeline construction in 2020. As noted below, the lands at issue are also the subject of the S’ólh Téméxw Stewardship Alliance’s (“STSA”) ongoing opposition, such that any PPBoR approval related to 1054408 BC Ltd.’s lands cannot be issued immediately following the release of the CER’s decision in this review.

Having considered the submissions of Trans Mountain and 1054408 BC Ltd., the CER continued to be of the view expressed in the 2018 Decision that pipeline construction must proceed first. The additional fill and loss of workspace resulting from development by 1054408 BC Ltd. would impair Trans Mountain’s ability to complete construction of the TMEP.

For these reasons, the CER found Trans Mountain’s request to revise the year of construction from 2019 to 2020 to be unnecessary. As a matter of practicality, the CER was not specifying a particular year for construction. The CER amended the 2018 Decision to read that the most appropriate timing for the TMEP’s construction is June to September.

The Relevance of the Reason for a Lack of Approval of Phase 2 of 1054408 BC Ltd.’s Residential Development

The CER acknowledged 1054408 BC Ltd.’s desire to begin work on Phase 2 of its residential development as soon as possible. The CER also accepted 1054408 BC Ltd.’s evidence that the TMEP is impeding this work, including with respect to related approvals. However, the CER noted that these facts were not relevant to the CER’s decision in this review. The GIC has approved the TMEP and the only issue currently before the CER related to the timing of construction. The CER agreed with Trans Mountain that any potential impacts on 1054408 BC Ltd. as a result of the TMEP’s construction are appropriately matters of compensation outside the scope of the detailed route approval process.

Conditions and PPBoR Approval

The CER noted that, as of the date of this decision, 1054408 BC Ltd.’s lands are also subject to the broader SOO filed by the STSA, which is being examined in Detailed Route Hearing MH-027-2020. Until the CER makes all necessary detailed routing decisions pertaining to 1054408 BC Ltd.’s lands, it cannot issue any order approving the associated PPBoR.

As was noted in the 2018 Decision, any future order approving the PPBoR for 1054408 BC Ltd.’s lands will include a condition requiring Trans Mountain to fulfill the commitments it made in the course of Detailed Route Hearing MH-003-2018, including Trans Mountain’s commitment to engage and work with 1054408 BC Ltd. regarding, among other things, the scheduling of construction activities.

Trans Mountain was also reminded that the relevant conditions of approval in Certificate OC-065 apply to the construction and operation of the TMEP pipeline on 1054408 BC Ltd.’s lands.

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