The Federal Court of Appeals overturned the approval of the Trans Mountain Pipeline (TMP) expansion on Thursday, discrediting the existing review given by the National Energy Board (NEB) and siding with the First Nations groups who had filed the court appeal.

“With such a flawed report before it, the Governor in Council could not legally make the kind of assessment of the Project’s environmental effects and the public interest that the legislation requires,” Justice Eleanor Dawson wrote.

The project expansion, which was first proposed by Texas-based owner Kinder Morgan in 2013, struggled in limbo for six years and has been a subject of contention between Alberta and British Columbia provinces. The TMP carries oil from Edmonton to Burnaby, and the expansion would triple the capacity of oil exports.

A rally in Burnaby, B.C. in 2014.

Within the hour following the court decision, Kinder Morgan stakeholders voted with more than 99 percent majority to sell the existing pipeline to the Canadian government in a Crown corporation.

Canada’s Federal Finance Minister Bill Morneau announced that the government will move forward with the sale.

“It was an important milestone today with the shareholder vote,” Morneau said at a press conference in Toronto.

Under the direction of Prime Minister Justin Trudeau, Morneau first offered to purchase the pipeline for $4.5 billion in May.

Despite Leak Canada Buys Kinder Morgan’s Trans Mountain Pipeline

After Kinder Morgan was met with resistance from environmental groups, local politicians, and some indigenous representatives, the corporation wavered in its desire to move forward with its expansion plans. The federal government offered to purchase the pipeline so as to protect the jobs and economic benefits that would be generated by the oil exports.

However, they have been unsuccessful thus far in finding a new buyer. Now, the owners will have to meet the court demands before the project’s future can be secured.

Also in reaction to the Federal Appellate Court’s announcement on Thursday, Alberta Premier Rachel Notley vowed to withdraw the province from the federal climate plan, thereby discrediting its success, until P.M. Trudeau had resolved the appellate court’s grievances and restarted the development of the expansion. This plan increases the carbon tax across provinces significantly over the next several years.

Rachel Notley at her swearing-in ceremony in 2015.

Alberta contributed $2 billion to Morneau’s purchase offer of $4.5 billion and would expect equity in the project in return.

Meanwhile, First Nations leaders in B.C. expressed surprise and celebration at the ruling. Justice Dawson’s conclusion that the indigenous tribes had not been properly consulted confirmed what many leaders had been arguing for years.

“The NEB was a flawed process from the beginning … and the courts recognized that today,” said Ruben George, Chief of the Tsleil-Waututh nation at a Vancouver news conference on Thursday morning. “This is a victory for us all.”

The Tsleil-Waututh, Squamish, and other First Nations were part of the combined two dozen lawsuits which reached the Federal Appellate Court. Their key complaint with the NEB approval of the pipeline expansion and the increase in oil carried was the threat it posed to the B.C. coastline, through both marine traffic and risk of oil spill.

“I was really taken aback by the decision,” said Stewart Phillip, Grand Chief of the Union of B.C. Indian Chiefs. “We denounced the so-called consultation process from the beginning as fundamentally flawed … and the courts upheld that.”

Phillip suggested that the federal government abandon the project rather than engage in new consultations. Justice Dawson addressed the likelihood of delays and hesitancy in this process in the court ruling.

“But, through possible accommodation the corrected consultation may further the objective of reconciliation with Indigenous peoples,” Dawson wrote.

 

Despite Leak Canada Buys Kinder Morgan’s Trans Mountain Pipeline