Indigenous Empowerment and the Canadian Economy
This article by resource lawyer Bill Gallagher originally appeared in “The Lawyers Daily” at https://www.thelawyersdaily.ca/articles/9472/indigenous-empowerment-and-canadian-economy
Until Canadians realize that our collective prosperity is totally connected to Indigenous prosperity, we’ll continue to pay through the nose as project after project demands government intervention and or taxpayer bailouts.
We’ve witnessed the climax of Indigenous empowerment in Canada and with it the far-reaching implications both on the national economy and national cohesion. The west is now alienated over pipeline gridlock, triggered by a second Indigenous legal win voiding yet another bitumen pipeline.
A brief historical overview is required to set the stage for the events of 2018.
Two years previous, on June 23, 2016, Northern Gateway was struck down by the Federal Court of Appeal (Indigenous win No. 231), an outcome that was met with disbelief by many “right thinking” Canadians.
But it was no surprise to me, since I spend a lot of time tracking the rise of Indigenous empowerment in the resources sector. Three months later on Sept. 2, 2016, Enbridge announced that the loss would not be appealed to the Supreme Court of Canada, meaning that the controversial ruling stood as good law.
At the time, I declared that this corporate decision point was the climax of Indigenous empowerment; in that they had killed an approved National Energy Board (NEB) pipeline that had been vigorously backed by then prime minister Stephen Harper and his entire front bench.
Later that year on Nov. 29, Prime Minister Justin Trudeau went public with his pipeline pronouncements: rejecting Northern Gateway (which was already dead), approving Enbridge’s Line 3 replacement, also Kinder Morgan’s Trans Mountain expansion to Burnaby.
Throughout this same timeframe, news media focused on the Indigenous pushback at Standing Rock over the Dakota Access pipeline.
That event was like a magnet, drawing in the Indigenous leadership from across western Canada, who were mindful of the potential for a similar event up in Canada — perhaps on top of Burnaby Mountain. Which brings us back to 2018.
Kinder Morgan announced on April 8 the suspension of all non-essential pipeline work. This was a signal that the on-site protests and non-stop litigation had taken its intended toll.
Then on April 19, Kinder Morgan declared the Trans Mountain pipeline project “untenable.”
That sent the prime minister the unmistakable message that doing business in Canada was fraught with undue investment risk. So less than one month later, on May 16, Canada bought the pipeline, lock stock and barrel, for $4.5 billion. This, after a front page Globe and Mail headline blared on May 18 that the: “Pipeline pledge won’t cost taxpayers a cent: Morneau.”
Lightning struck twice! Three months later, on Aug. 30, 2018, the same Federal Court of Appeal, using much the same rationale as it did in Northern Gateway, now voided the permits of the Crown-owned Trans Mountain pipeline (win No. 263). Neither did this Indigenous legal win come as a surprise to me; but it sure did to those same “right thinking” Canadians who were already incensed over Northern Gateway’s demise.
They wanted to hang both pipelines on Prime Minister Trudeau as proof that he had abandoned the oil patch’s engine of growth by denying it access to tidewater. Missed in all the finger pointing was the fact that both the Harper and Trudeau approval processes had completely bungled the duty to consult — in the stage between the NEB certification and the government order-in-council approval of same.
Neither was this second legal win appealed by Canada, meaning that both decisions now stand as good law, making for two major bitumen pipeline wins in the Indigenous trophy case.
As a result of percolating interprovincial bickering, tensions finally exploded in the fall of 2018 that saw Alberta and British Columbia, then Alberta and Quebec, accuse each other for causing and or exacerbating the bitumen gridlock crisis. Then on Dec.18, 2018, the Trudeau government pledged an additional $1.6B in aid to the oil patch in an effort to demonstrate Ottawa’s bona fides as the honest broker of this now-crisis situation; to which Alberta responded that it was being bribed with its own federal equalization contributions.
Lost in all the political machinations was the fundamental fact that it was the rise of Indigenous empowerment in the resources sector that was driving the geopolitical gridlock across Canada. They’ve now legally blocked two approved pipelines to tidewater, with each one having a prime minister as its de facto CEO.
Bill Gallagher has been a corporate lawyer in Calgary, an energy regulator in Ottawa, and a treaty negotiator on the prairies. Readers can get caught up on the sweep of this fascinating story in Bill Gallagher’s new book Resource Reckoning — a strategist’s guide from A to Z available on Amazon.com. An authority on the rise of Indigenous empowerment in Canada’s resources sector, you can contact him at email@example.com.