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Support for Trans Mountain Expansion Project

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Resolution Category: 
Extraordinary Resolution 4
Spruce Grove, City of
Active Clauses: 

IT IS THEREFORE RESOLVED THAT  the AUMA urge the Government of Alberta to continue to support the Trans Mountain Expansion Project so it can meet its commitments to delivering jobs and economic benefits and meeting its regulatory requirements during the construction and operation of the pipeline.

FURTHER BE IT RESOLVED THAT the AUMA  urge the Federal Government to ensure that all regulatory processes that have been recommended for approval by the NEB and subsequently authorized by the Federal Governor in Council  are permitted to proceed.

FURTHER BE IT RESOLVED THAT the AUMA urge the Federal Government to exercise ancillary powers in order to enact the comprehensive regulatory scheme for the Canadian public interest, including the right to timely permitting, thereby enabling the commencement of construction.

Whereas Clauses: 

WHEREAS energy and its related products are a significant part of Canada’s annual exports, which along with metals and mineral products, represent the single largest positive annual contribution to Canada’s balance of trade;

WHEREAS the National Energy Board (NEB) determined the Trans Mountain Expansion Project (TMEP) is in the Canadian public interest;

WHEREAS the Federal Governor in Council approved the project application on November 29, 2016;

WHEREAS the Conference Board of Canada conservatively estimates $46.7 billion will find its way into government treasuries in the form of taxes and royalties from the TMEP during development and over the first 20 years of operations;

WHEREAS economic benefits generated during construction and 20 years of operations from the TMEP include;

  • $68.3 billion in additional revenue to Alberta oil producers attributable to Trans Mountain as a result of higher netbacks, over the first 20 years of operations
  • $45 billion GDP effects for Alberta

WHEREAS in addition to benefits created by the TMEP, operations of the expanded Trans Mountain Pipeline will generate $3.3 billion in taxes over 20 years, with Alberta receiving a $567-million share;

WHEREAS local and regional property tax payments are estimated to go up by a total of $3.4 million per year, a 116 per cent increase along the Alberta section of the route; and

WHEREAS the process does not supersede the importance of the individual land rights.

Resolution Background: 

In December 2013, Trans Mountain submitted an application to the National Energy Board (NEB) to expand its existing pipeline system, increasing daily capacity from 300,000 barrels up to 890,000 barrels. The $6.8-billion Kinder Morgan expansion would triple the capacity of the existing 1,150 kilometre pipeline between Alberta and Burnaby, British Columbia.

Following a 29-month review, the NEB, on May 29, 2016, concluded that the TMEP is in the Canadian public interest and recommended that the Federal Governor in Council approve the expansion. The NEB attached 157 conditions which address issues such as public safety, economic benefits, local job creation, emergency preparedness and emergency response, Aboriginal interests, environmental protection and safety along both the pipeline right-of-way and the marine tanker transport route. The NEB’s review was rigourous, involving a record 404 intervenors and more than 1,200 commenters.

On November 29, 2016, the Government of Canada accepted the NEB recommendation, noting that Canada needed to expand the markets for its oil products and saying that the TMEP “will make that possible.”

On January 11, 2017, the Province of British Columbia announced that the Project had received its environmental certificate from BC’s Environmental Assessment Office subject to 37 Conditions. The Province stated that TMEP met its Requirements for British Columbia to Consider Support for Heavy Oil Pipelines, known as B.C.’s Five Conditions.

The Trans Mountain pipeline infrastructure has national economic significance. As Canada’s primary energy transmission pipeline, the system is approximately 115,000 km in length, and the total pipeline network is approximately 840,000 km, including regional gathering, feeder and distribution lines. By comparison, there are 38,000 km of primary highway transportation linkages across the country.

In addition to the estimated $46.7 billion of taxes and royalties the Federal and Provincial governments will recognize from the TMEP during development and over the first 20 years of operations, including $19.4 billion recognized by Alberta, largely in the form of royalties from producers earning higher netbacks from selling their product into new markets, the project will create 441,000 person-years of employment in Alberta from project development and operations. This includes:

  • 14,600 construction jobs
  • 13,340 pipeline operations jobs
  • 11,200 jobs generated by dividend payments from oil producers
  • 400,600 jobs related to additional investment in oil and gas development as a result of higher netbacks to producers.
  • Overall, the project generates more than 800,000 person-years of work for Canadians.

Including existing and increased payments, local governments in Alberta will collect $124 million in taxes over 20 years from operations on an expanded Trans Mountain Pipeline.

Given the significant financial benefit of TMEP to all of Canada, it is incumbent upon the Government of Canada to exercise power to ensure the TMEP is completed, including issuance of all permits.

The Government of Canada, through various regulatory frameworks, has exercised its legislative and jurisdictional authority in the approval and oversight of projects deemed to be in the interest of Canada as a whole, including radio communications, inter-provincial railways, and airports and aerodromes.

Government Response: 

In a letter from the Minister of Energy, it was indicated that Alberta has, and will continue to be, a strong advocate for safe, modern pipelines. The Minister indicated the province would not stop until construction is underway on the Trans Mountain Expansion Project and Alberta oil is flowing to new markets. The province will continue to use every opportunity to support the project, whether it be intervening in legal challenges like the Federal Court of Appeal judicial review of the project in October 2017, or participating in regulatory processes like the National Energy Board hearing for Burnaby permitting in December 2017.

o On June 25, 2018 we received a letter in response from the Prime Ministers Office indicating our support had been shared with the Minister of Natural Resources. While the response was generic, the federal government did make the decision to purchase the Trans Mountain Pipeline and move forward with it.

AUMA Notes: 
  • letter enclosing the resolution was forwarded to the Minister responsible.
  • This resolution aligns with a resolutions adopted by members in 2016 calling on the federal and provincial governments to support the expansion of pipeline infrastructure and expedite increased market access for Alberta’s oil and natural gas exports.
  • AUMA sent a letter signed by 167 of its members requesting action from the Prime Minister.
  • AUMA President, Barry Morishita, issued an open letter to municipal leaders outlining the value Trans Mountain represents for municipalities both in Alberta and BC.
  • AUMA has partnered with other organizations, industry and municipalities to launch the Resource Communities of Canada Coalition focused on bringing the message of responsible energy development across the country. The coalition has already had a series of meetings with municipalities and Quebec and is preparing a campaign for the upcoming Federation of Canadian Municipalities (FCM) meeting in Quebec. More information will be shared with members as the conference approaches.

    On February 1, 2019, AUMA President Barry Morishita was part of a delegation that met with a group of independent Canadian senators in Edmonton to discuss Bill C-69. The Bill has been under debate in the Senate since December 12, 2018. Bill C-69 would create significant obstacles to future energy development.

    AUMA’s key issues with Bill C-69:
    Municipalities are concerned these amendments will directly impact municipal land-use planning, construction and maintenance of infrastructure. The proposed Bill could result in more municipal infrastructure projects falling under federal review.

    This could add additional financial and administrative costs to municipal operations.

    Municipalities need more clarification on a new requirement to consider and protect Indigenous traditional knowledge and the consultation process required with Indigenous communities. o It is unclear how the new process will work for adding navigable waters to the list of waters subject to extra oversight.

    It is unclear how the new process will work for adding navigable waters to the list of waters subject to extra oversight. It is unclear “who” can make this request, local citizens, Indigenous communities, or environmental non-governmental organizations.

    Clarification is needed regarding the definition of navigable water and how “reasonable likelihood” will be defined in relation to the water body being used for navigation. For example, many waterways in Alberta are seasonal, the frequency of navigation needs to be considered and clarified.

    More work needs to be done on the categorization of “Minor Works,” “Major Works,” “works other than a minor work.” These categories create a complex series of requirements.FCM has recommended that Transport Canada conduct a review of existing Minor Works to assist municipalities to better understand the requirements.

    Although the impact on the resource development sector does not directly affect local governments, the industry is important to economic prosperity and quality of life in many local communities.

  • AUMA Accepted the provincial response and is considering the federal response.
AUMA Comments: 
Considers government response