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Hummingbird nesting season stops Trans Mountain pipeline expansion
Gary Park for Petroleum News
Canada’s Trans Mountain pipeline expansion has never escaped the battlefront from the time of the project’s public launch in 2012.
Building a 710-mile link to triple capacity on the system to 890,000 barrels per day of crude bitumen from the Alberta oil sands, through the Canadian Rockies to a Vancouver area tanker terminal, primarily for export to Asian markets was never going to be easy.
As opposition to what is known as TMX has stretched the completion date for the C$12.6 billion undertaking to late 2022, environmentalists, First Nations and all-purpose protesters have drawn strength from their occasional success in stalling work on the pipeline.
Despite a growing string of rebuffs from British Columbia and federal courts, the threats to TMX have ranged from COVID-19, rail blockades and legal challenges to … hummingbirds!
The 3-inch-long birds, whose annual migratory flights cover round trips of almost 4,000 miles, did what few others outside of high court rulings have managed to do - stopped construction of the pipeline through a forest in the Greater Vancouver region until Aug. 20.
Environment and Climate Change Canada, a federal department, issued an order in in April covering a strip of 1,100 yards until the end of the bird nesting season.
“Given that it is nesting season, migratory birds are particularly vulnerable at this time,” the department said, after two on-site inspections.
“Cutting vegetation and trees or carrying out other disruptive activities such as bulldozing or using chainsaws in the vicinity of active nests will likely result in disturbance or destruction of those nests.”
Trans Mountain, owned by the Canadian government, confirmed the order without comment.
Insurer issue On a much larger scale, Trans Mountain has been caught up in a bid by environmentalists to disclose its insurers, hoping that would provide fresh targets for activists.
That strategy has been spurred by a decision in April by Zurich, the giant Swiss-based company, not to renew its coverage of what opponents call a “climate wrecking” pipeline from the oil sands.
A spokesman for Zurich said the insurer will not comment on its customer dealings.
Trans Mountain said it has the insurance it needs for its existing operations and the “expansion project” covering claims up to C$508 million.
Zurich was the sole insurer for the first C$8 million of potential payouts, along with C$300 million of cover with other partners.
Lloyd’s of London syndicates are Trans Mountain’s biggest insurer, with packages that involve 11 companies, of whom Germany’s Talanx/Hannover indicated last year it planned to drop its participation in the pipeline, while the Munich group said it would review its contract given its new underwriting guideline for the oil sands.
Confidentiality issue As that pressure builds, Trans Mountain gained the support of the Canada Energy Regulator to keep its insurers’ names confidential.
The federal agency said Trans Mountain had “satisfied the requirements for confidentiality. The names of Trans Mountain’s insurers could reasonably be expected to prejudice its competitive position in its dealing with potential insurers.”
Charlene Alecks, a spokesperson for the Tsleil-Waututh Nation Sacred Trust Initiative, one of the Indigenous opponents of the pipeline, said the CER is “expanding Trans Mountain’s culture of secrecy when it should be doing the opposite, especially for a government-owned company during a climate crisis. This is a dangerous precedent.”
Grand Chief Stewart Phillip, president of the Union of British Columbia Indian Chiefs, said any company insuring Trans Mountain is “complicit in violations of Indigenous rights, because the proposed pipeline expansion does not have the consent of all impacted First Nations along the route.”
Elana Sulakshana, energy finance campaigner for Rainforest Action Network, said Zurich’s action “demonstrates that it is waking up to the risks of this toxic project in Indigenous land rights, local ecosystems and the planet.”
She said some of Zurich’s peers in the global insurance industry “are also taking note, as eight (of the 11 companies) now have policies that limit or end insurance coverage (for the oil sands).”
The opponents of the pipeline are now calling on the insurers to turn down invitations to renew their coverage; rule out insurance for all oil sands extraction and transportation; and adopt policies to ensure that projects and companies they insure have obtained the full, informed consent of impacted communities.
Financial impact Further stoking the fires of opposition, Simon Fraser University in the Greater Vancouver region issued a new benefit-cost analysis study estimating Canada stands to lose between C$3.2 billion and C$18.45 billion from the pipeline expansion.
University researchers examined close to 20 business scenarios involving sales of TMX crude and concluded than none will generate a net benefit for Canada, pointing to the prospects of increased construction costs, the effects of weaker oil prices, Canada’s new climate plan and the cancellation of Keystone XL permits by President Joe Biden.
Lead author and an SFU professor, Thomas Gunton, said climate policies have affected the landscape significantly since the Canadian government bought Trans Mountain off Kinder Morgan for C$4.5 billion in 2018.
The study said the crux of the problems facing Trans Mountain is oil demand, which it claimed will decline over coming years because of global policy shifts toward net-zero greenhouse gas emission goals, contrary to many predictions that consumption of fossil fuels will remain strong until at least 2050.
- GARY PARK
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