You can’t blame Trans Mountain Corp. President/CEO Ian Anderson and his staff if they are sitting on the edge of their seats. The Calgary, Alberta-based pipeline company is awaiting a final decision expected next week from federal lawmakers in Ottawa concerning a multibillion-dollar expansion project designed to bring additional Canadian oil to tidewater and help make sure Canada gets full value for its oil.
Although Canada depends on oil revenues for a significant portion of its budget, new infrastructure has been stymied by opposition as well as a National Energy Board (NEB) that has approved few pipeline projects in recent years; the NEB did, however, reapprove the Trans Mountain project in March, six years after it was first announced.
The need for new or expanded construction has led to a lengthy debate among pipeline operators, construction crews and those opposed to fossil fuels. First Nations, or indigenous peoples, have been increasingly drawn into the controversy. The conflict that erupted in South Dakota in 2016 between the Standing Rock Sioux and Energy Transfer Corp. during construction of the $3.7 billion Dakota Access Pipeline remains fresh in everyone’s mind.
Whatever decision comes down, Anderson and his staff can take comfort knowing their reputation for integrity with local communities, including indigenous peoples, has never wavered. They don’t promise what they might not be able to deliver, and what they do promise, they deliver on. It’s a policy that has been in place over the 65 years since the initial oil pipeline from the Edmonton area into Burnaby, B.C., was constructed.
It’s a policy that works. Last year, Trans Mountain announced that 43 indigenous groups in BC (33) and Alberta have signed Mutual Benefit Agreements (MBAs) in support of the expansion. This will lead to Trans Mountain sharing in excess of $400 million with those communities. Trans Mountain said it has now signed approximately 100 agreements over the past six years with indigenous communities and groups with either a direct interest in the project or which could be potentially affected.
Some history: Trans Mountain has had an operating pipeline from Edmonton to Burnaby since 1953, bringing both refined and unrefined products through the pipe in a batch system. They feed different sources in British Columbia and Washington state. The city of Burnaby is home to two Trans Mountain terminals—one houses 13 oil storage tanks and the other is the marine terminal, which has been safely loading tankers since the 1950s without incident.
The pipeline has been operating at its maximum capacity each month for many years, despite swings in oil prices. Trans Mountain’s customers, a mix of producers primarily from the oil sands, want additional space to ship more product and access world markets. The limited capacity of the system today prohibits shippers from establishing reliable access to trade consistently with markets in the Pacific Rim.
After studying a variety of options, Trans Mountain decided a twinning of the existing pipeline was the best solution. It already has commercial agreements in place with 13 shippers for 15-20-year contracts. The second line would include 610 miles of pipe to be laid in vicinity of the original along with 12 new pumping stations, boosting capacity from 300,000 barrels per day (bbl/d) to nearly 900,000 bbl/d. The estimated cost currently sits at $7.4 billion.
The question of ownership is complicated. Trans Mountain Pipeline is now a wholly owned subsidiary of the Canadian Development Investment Corp. (CDEV) which is accountable to Parliament. Trans Mountain was owned by the Canadian division of Kinder Morgan Energy Partners, which decided to sell the company in 2018 because of increased opposition, including a trade war between Alberta and BC, to the expansion project. Much of the opposition revolves around the potential of tanker spills.
Understanding the need to expand the system, which is North America’s only pipeline with access to the West Coast, the Canadian government bought the pipeline from Kinder Morgan for $4.5 billion. The plan is for outside investors, which could include Indigenous communities, to buy into the project.
Meanwhile, Anderson, who has worked in the Canadian pipeline industry for over 40 years and has been involved in the Trans Mountain expansion since 2008, and his staff continue to meet with local communities to convince them that their safety concerns are understood and being addressed. Anderson has earned a reputation for becoming personally involved in relationships with the indigenous communities—setting a standard for the rest of his company. It is a topic that he proudly discusses.
“We’ve had a relationship all along the pipeline with local communities, landowners and Indigenous peoples developed over many years of cooperating with regular pipeline business. We wanted to go out in a meaningful way and work with all kinds of communities to learn their interests and concerns in the project to address them where we can. We also want to ensure that as many benefits as possible flow to as many people along the pipeline route as a result of the expansion,” he said.
Trans Mountain employs an engagement team at key areas along the pipeline. These “boots on the ground” workers meet not only with indigenous communities but also with local municipalities and regional districts. There is a special team designated as the point people in dealing with landowners.
During negotiations, community relations specialists work with the Trans Mountain team to create the opportunities identified in the MBAs. This has included a variety of initiatives, including job readiness and emergency response training. It’s ultimately up to local liaisons to see that relationships are fostered and the commitments made within those benefits are honored.
Over a 65-year period, it might seem difficult to maintain trust. Perhaps not, if mutual interests are involved. Trans Mountain has changed owners over those years and local governments and Indigenous groups have had different leaders as well. What they have all learned is that while leadership and the rules may have changed on both sides, the commitment to the relationship for the most part in all the communities has been there.
“Having an operating company in your community is something that both sides recognize as a need to ensure that there’s a positive working relationship,” Anderson explained. But when you’re dealing with a pipeline that crosses two provinces, the scope of differences can be extensive.
“The reality is that we all know no community is homogenous, whether it’s people living in Vancouver or Edmonton or people who are part of an Indigenous group. The challenges and responsibilities are different with a municipality vs. an indigenous group vs. individuals.
“It’s more geographic than anything else,” he continued. “If you look at a map where our pipeline goes, the support is strong in Alberta and through the interior of the province, the real concern is jobs and opportunities. Perhaps it’s someone who runs a local construction company—an excavator—and wants to get involved or you’re an Indigenous community that wants to ensure their youths get training and opportunities.
“The last few kilometers into the lower mainland is where our biggest challenges are, both from an engagement perspective as well as from a construction perspective. When you get into the lower mainland of BC with Vancouver, Burnaby and all the major cities, planning and building a pipeline is a real challenge because the actual construction gets much more complex.
“When you’re dealing with a pipeline built over 65 years ago, when it was first built, there wasn’t the same kind of infrastructure as today. Where it may have been going through farmlands, housing, roads and new infrastructure is now built up around it. They also have stronger philosophical views of pipeline infrastructure,’’ he said.
They are committed to maximizing business and employment opportunities for indigenous, local, and regional communities along the pipeline corridor.
Trans Mountain and its contractors assist by providing training opportunities and promoting the process to apply for jobs. Across the pipeline, they have hosted weekly business readiness workshops and work with the local chambers of commerce. Local businesses are invited to meet with the general contractors to learn of opportunities in that region: how many local backhoe operators will be hired; how much equipment they’ll be needing; what kind of rentals are required.
“Through those connections, businesses can hopefully get prepared or ensure they’re bidding at the right time. We’re not only making that commitment as a statement but we’re following through, trying to ensure the local Indigenous communities get the opportunities and are aware of them as early as possible,” Anderson said.
Trans Mountain has also worked with local government to devise benefits agreements designed to help them develop the project of their choosing. Some have identified walking trails or recreational facilities, others a town square or improvements to an access road. Each agreement is unique, and particularly in the case of the Indigenous people, include more longer-term community benefits.
Many indigenous groups wanted to be certain the MBAs contained training; some included emergency response kinds of structure, providing equipment caches and training in some of the more remote areas that could be used for a pipeline incident or any kind of emergency in the community.
Here’s an example of how a mutual interest can work. A few years ago, some wildfires broke out near Trans Mountain’s Kamloops terminal. While it didn’t impact directly any facilities, the company provided staff and a considerable amount of equipment to help the community manage some of the local wildfires.
“It’s times like that, being part of the community over the years, which has enabled us to develop relationships of trust and respect,” Anderson said.
Though not all indigenous groups support the expansion, the Vancouver Sun reported on May 3 that one influential organization is not only supportive, it wants to acquire an equity stake in the project.
“We always wanted equity, but in our negotiations with Kinder Morgan equity was not on the table. When the government of Canada bought the pipe it opened the door to equity,” said Michael LeBourdais, chair of the Western Indigenous Pipeline Group.
In response to opposition from other First Nations leaders, LeBourdais admonished them for an “old way of thinking… where indigenous peoples are left out from the benefits of developments on their title land and decisions are made without their consultation.”
He said ownership will give the First Nations along the pipeline route the power to lead environmental risk assessments and “realize the largest economic benefits.”
“This pipeline goes right through the middle of our reserve…so we are very familiar with where this pipeline goes and how it works. Most of us are firefighters, forestry workers and oil patch workers. We understand how safe it is.”
LeBourdais added, “We can retain the expertise and the capacity to own and operate a chunk of this pipeline and that’s what we’re going to do.”
Federal officials are completing their review of a new court-ordered round of meetings with Indigenous communities. If the ruling is in Trans Mountain’s favor, as is expected, construction will resume as soon as possible, possibly this summer, Trans Mountain said.
It helps to have someone like Ian Anderson at the table.
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