April 9, 2018 5:45 pm
Updated: April 10, 2018 9:11 am

How Ottawa might try to save the Trans Mountain pipeline

Minister of Natural Resources Jim Carr leaves Parliament Hill after speaking about the recent status of the Kinder Morgan pipeline expansion in Ottawa on Sunday, April 8, 2018.

THE CANADIAN PRESS/ Patrick Doyle
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On Sunday afternoon, Natural Resources Minister Jim Carr stood in front of the seat of federal power in Canada and promised that his government would figure out a way to use that power to save the Trans Mountain pipeline project.

The Liberals approved it back in 2016, but repeated attempts by British Columbia to delay the pipeline expansion have left the company behind it — Kinder Morgan — nervous.

WATCH: Kinder Morgan halting Trans Mountain pipeline expansion result of ‘uncertainty’


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Things came to a head over the weekend when the firm announced it has halted all non-essential spending, and if nothing changes, it plans to abandon the project at the end of May.

When reporters gathered around Carr on Parliament Hill Sunday asked what the minister planned on doing next, he said that “all options are on the table.”

Pressed for specifics, Carr wouldn’t budge.

READ MORE: Kinder Morgan decision to halt pipeline work a ‘devastating’ blow, says Scheer

But experts consulted by Global News on Monday have a few possibilities in mind. The federal government will need to act fast, however, regardless which ones it attempts. Here are some options.

Flexing legal muscle

The federal government has the law on its side, experts agree.

“Ottawa clearly has jurisdiction over pipelines,” said Brian Lee Crowley, managing director of the Macdonald-Laurier Institute. “It’s been confirmed over and over again by the courts.”

Section 92 of the Constitution Act gives Ottawa a declaratory power to state that a piece of infrastructure is a work for the general advantage of the entire country. But invoking it would really just be “doubling down” on the jurisdiction that is already well-established in the law, Crowley said.

WATCH: B.C. Premier John Horgan responds to Kinder Morgan’s decision

Ian Blue, an expert on energy, regulatory and constitutional law who serves as counsel to Gardiner Roberts LLP, agreed. Section 56 of the Constitution Act is the real trump card, he said, although it’s been used extremely rarely.

“Section 56 gives the federal cabinet the power to disallow any provincial law,” he noted.

Working up to that would be a process, however. Blue explained that the prime minister could make a statement in the House of Commons, establishing that construction on Trans Mountain should start right away.

READ MORE: B.C. MPs Elizabeth May, Kennedy Stewart arrested at Kinder Morgan facility

If construction doesn’t get moving, Blue said, the statement would make it clear that cabinet is prepared to invoke the Federal Emergencies Act, declare a state of emergency in B.C. and Alberta, then propose measures to resolve that emergency.

Those measures could include, for instance,  instructions for government lawyers to head to court and request that all lawsuits involving the pipeline be halted until the emergency is officially declared over.

If none of this puts a stop to the opposition, Blue said, Section 56 could be invoked to disallow any law that would stand in the pipeline’s way.

A cash injection

Injecting taxpayers’ money directly into the Trans Mountain project is another possibility the Liberal government is considering, Carr confirmed on Monday afternoon. The minister was careful to note that this is not a certainty, just one of the available options.

READ MORE: ‘A government openly in opposition’ Kinder Morgan CEO speaks on pipeline project

Carr’s statement came on the heels of one from Alberta Premier Rachel Notley, who said her province is prepared to invest directly in the pipeline if it would help keep Kinder Morgan investors on board and buy more time to get the project moving.

Kinder Morgan CEO Steve Kean later said that his company would be open to government investment if it brought certainty to the project.

Sanctions

If injecting money into Kinder Morgan’s coffers isn’t feasible, the federal government might consider denying money to British Columbia’s.

Normally, economic sanctions or penalties are discussed in an international context, but Alberta opposition leader Jason Kenney suggested Monday that Ottawa put an economic squeeze on B.C. with reductions in federal transfer payments.

Carr would not confirm if anything of the sort is being considered, and it could be a costly political move.

Sanctions would almost certainly be unpopular in B.C., where the federal Liberals will be trying to hold onto 17 seats in 2019.

“Cancelling those payments wouldn’t necessarily get the pipeline built and it would hurt an awful lot of poor people in British Columbia,” noted Blue.

Diplomacy

This one has arguably already been attempted, with Prime Minister Justin Trudeau and members of his cabinet trying repeatedly to convince B.C. Premier John Horgan to back down.

Officials were previously dispatched from Ottawa to try and smooth things over between Alberta and B.C. in February.

WATCH: Kinder Morgan pipeline protest arrests get ugly

“I had a long conversation with premier Horgan last night, in which I impressed upon him the importance of working together and respecting the federal responsibility for protecting things that are in the national interest,” Trudeau said Monday in Montreal.

Horgan confirmed he spoke with Trudeau late on Sunday, adding that “there were no threats, there was no intimidation” from the prime minister.

But the Conservatives say Trudeau missed a huge opportunity last week when he failed to meet in person with Horgan while on the ground in B.C.

Doing nothing

While environmental groups would probably like nothing more than to see the prime minister throw up his hands and let Kinder Morgan bail out of Trans Mountain, Trudeau has been clear that doing nothing is not an option he’s willing to entertain.

“This is a pipeline in the national interest, and it will get built,” he reiterated on Monday.

WATCH: Trudeau defiant on Trans Mountain pipeline construction

Doing nothing would also send a clear signal to other companies looking to invest in major energy projects that approval from the federal government isn’t going to guarantee that the work actually moves ahead.

-With files from Abigail Bimman and The Canadian Press

© 2018 Global News, a division of Corus Entertainment Inc.

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