The British Columbia government’s legislative attempt to block the expansion of the Trans Mountain pipeline failed this week, after a Supreme Court of Canada judgment was issued against it.
The Trans Mountain Pipeline is a pipeline that carries crude and refined oil from Alberta to the coast of British Columbia. The expansion project proposal includes, among others, adding a second span of pipeline for the purpose of transporting diluted bitumen from Edmonton, Alberta to Burnaby, B.C.
As we wrote about last year, the British Columbia government went to the B.C. Court of Appeal in an attempt to limit the passage of heavy oil into the province in response to the Trans Mountain pipeline expansion.
In March 2019, the B.C. government submitted a reference to the Court of Appeal seeking to determine whether the province could enact environmental laws that would “prevent oil spills and leaks and mitigate the harm that may occur”. While the government acknowledged it could not stop the Trans Mountain pipeline expansion, it sought to obtain judicial approval of draft regulations to British Columbia’s Environmental Management Act that would allow it to limit any increase of heavy oil being transported through the province, whether by pipeline, rail or highway.
Court of Appeal Decision
In May 2019, the Court of Appeal released its decision, concluding that the province of British Columbia did not have the right to impose environmental laws that would effectively stop the Trans Mountain pipeline expansion.
Ultimately, the court decided that B.C.’s proposed legislation to limit the flow of increased amounts of “heavy oil” into B.C. would be in direct conflict with federal jurisdiction over interprovincial pipelines.
The court found that the proposed amendments to the Environmental Management Act would essentially usurp the National Energy Board’s role in approving projects in the national interest.
The B.C. government appealed to the Supreme Court of Canada.
Supreme Court of Canada Decision
The appeal was heard by the Supreme Court of Canada on January 16, 2020 as between the Attorney General of British Columbia and the Attorney General of Canada (with 26 interveners).
The Supreme Court of Canada released its decision on the same day the appeal was heard. Its unanimous one paragraph judgment was issued orally by Chief Justice Richard Wagner, who stated:
“We are all of the view to dismiss the appeal for the unanimous reasons of the Court of Appeal for British Columbia.”
According to the CBC, B.C. Premier John Horgansaid that he was disappointed by the decision, which effectively ends the province’s litigation, while Alberta Premier Jason Kenney called the decision a “big win” for his province.
When disputes arise in the oil and gas industry they can be complex, involving international parties and various pieces of specialized legislation. If you are involved in such a dispute, it’s important for you to have a legal team in place that knows how these interests and laws work together and can help you navigate this intricate terrain.
At DBH Law, our Calgary-based lawyers are uniquely positioned to advise clients on issues that may arise in oil and gas. We have worked with clients in Alberta, across Canada, and around the world and are intimately familiar with the global nature of this ever-changing industry.
Our extensive experience representing clients in the oil and gas industry has given us the tools to help our clients with their unique needs. Please contact us online or by phone at 403.252.9937 to find out how we may be able to help you.