PIPELINE OBSERVER Fall 2019

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PIPELINE

FALL 2019

CANADIAN ASSOCIATION OF ENERGY AND PIPELINE LANDOWNER ASSOCIATIONS

CONTINENTAL ASSOCIATION OF ENERGY AND PIPELINE LANDOWNER ASSOCIATIONS

OBSERVER

TRANS MOUNTAIN PIPELINE LANDOWNERS HAVE REASON TO BE AFRAID CAEPLA can help

FAMILY MATTERS

Pioneering women in the pipeline landowner movement

LAW OF THE LAND

John Goudy holds companies to account

CROSS-CANADA CORRIDOR The problem with Andrew Scheer’s $100 billion plan


Deep roots. We didn’t start learning to drive a tractor at 10 years old. Or rise to the challenge of running the family farm. But we do help power the machinery that will empower generations of farmers to come. When the energy you invest in farming meets the energy we fuel it with, sustaining a nation happens.


CONTENTS

FALL 2019

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“My dad is still very involved in pipeline owner issues. I think he likes that I’m involved in this, too.”

Cover: iStock / georgeclerk; iStock / ssuaphoto; iStock / vicnt; iStock / miroslav_1; designed by David Willicome This page clockwise from top: Photo courtesy Enbridge / Allen Sawatzky; Photo by Brenda Coghlin Photography; iStock / Osvaldo Maldonado

–John Goudy

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Who Can You Trust?

CAEPLA can protect TMX landowners

Independent Construction Monitors Your eyes, ears and boots on the ground

Pipeline Dialogue

CEPA engages with a broad group of stakeholders

Agricultural Capability on Rights-of-Way CAEPLA studies soil quality and gauges risks

Trans Mountain Approved. Again. So far, there’s little to show for a nationalized pipeline The Line 3 Reclamation Project

Reclamation along Enbridge’s replacement pipeline

Practising the Law of the Land

Lawyer John Goudy works on behalf of landowners

Andrew Scheer's Energy Corridor

How this $100 billion plan will violate property rights

Are Property Rights a Women's Issue?

Advancing the pipeline landowner movement

Federal Regulations Pre-Empt Property Rights

Regulating regimes protect industry from landowners

The Latest Threat From Manitoba Hydro

Transmission line carries risks to corridor residents

Can Arrowheads Kill Property Rights?

The challenges of the emerging heritage site strategy

Indigenous Ownership of Trans Mountain What would it look like?

TMX and the Constitutional Mutiny An interview with David Yager

The Knowledge Problem

Why government pipeline schemes are destined to fail

Pipeline Observer is a publication of the Canadian Association of Energy and Pipeline Landowner Associations and the Continental Association of Energy and Pipeline Landowner Associations 257, 918 Albert St., Regina, SK S4R 2P7; 306-522-5000. All contents copyright ©2019 CAEPLA. Advertising information: advertising@caepla.org | Editorial: editor@caepla.org Administration: admin@caepla.org | caepla.org | Twitter: @CAEPLA

Media & Marketing Solutions

Published on behalf of CAEPLA by RedPoint Media Group Inc., 100, 1900 11 St. S.E., Calgary, AB T2G 3G2, 403-240-9055, Toll Free 1-877-963-9333, info@redpointmedia.ca, redpointmedia.ca | Printed in Canada by Transcontinental LGM | Statements and viewpoints expressed herein do not necessarily represent the views of the publisher. | PM 40030911 CAEPL A .ORG

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B Y D AV E C O R E

Who Can You Trust? Only CAEPLA can guarantee TMX landowners the gold standard, Line 3 Replacement experience

I

have been involved in pipeline landowner issues for nearly three decades. In the last two decades, I have worked with the Canadian Association of Energy and Pipeline Landowner Associations (CAEPLA)

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negotiating precedent-setting solutions to landowners’ legitimate concerns on many projects, with many different companies. But I have never seen anything quite like the “company” that currently owns the Trans Mountain pipeline and its expansion project (TMX). The company I refer to is, of course, the

Government of Canada, which makes TMX no ordinary company—it is a Crown corporation. The majority of energy transport companies CAEPLA has successfully dealt with are privately owned. Crown corporations are creatures of government and, as such, are different animals altogether.


“I have never seen anything quite like the ‘company’ that currently owns the Trans Mountain pipeline and its expansion project.”

iStock / Leontura

CAEPLA has been in the trenches fighting a provincial Crown—Manitoba Hydro—for the last five years. This experience has taught us, and our member landowner committees on the front line, that Crown corporations are a landowner’s worst nightmare. Ever heard it said, “You can’t fight city hall?” The saying is meant to suggest the deck is stacked against the individual citizen because, after all, city hall is the government, which means it has unlimited resources and makes all the rules. Well, Crown corporations are part of the government, too. The same government that writes the regulations and hires the regulators. This is why I am afraid for TMX landowners. Very afraid. And you should be, too, if you are a landowner on that pipeline. Why be afraid? Because if CAEPLA’s experience on the Prairies with Manitoba Hydro and Sask Energy are anything to go by, TMX—assuming construction ever actually gets going, but that’s another column altogether —will be the worst thing that ever happened to landowners along that corridor. Whether it’s in regard to replacement or expansion construction, soil restoration, integrity digs, abandoned and decommissioned pipe or historic contamination—and trust me, there will be lots of historic contamination on Trans Mountain—landowners are going to be in a tough spot dealing

with Ottawa and the regulator. So this is your last chance to get this project done right. Meaning, landowners need experienced professional help. CAEPLA has acted with and resolved issues for landowners in win-win agreements on all the major projects approved and built in Canada in the last decade. First on the Enbridge Alberta Clipper/Southern Lights Project from Hardisty, Alberta, to Gretna, Manitoba. Then on the approved and completed TransCanada Keystone and the approved (but not completed) Canadian portion of the KXL in Alberta and Saskatchewan. And later on a number of TransCanada projects in the Peace area of British Columbia and other pipeline and energy corridors across the country. Our most recent success has been working with the Manitoba Pipeline Landowners Association (MPLA) and the Saskatchewan Association of Pipeline Landowners (SAPL) to negotiate the most robust win-win landowner business and construction agreement to date: the Enbridge Line 3 Replacement Project (L3RP). Line 3 was an aging pipeline that was causing worries for Enbridge, landowners and other stakeholders. Output and pressures had been reduced for safety reasons and something needed to be done. Using CAEPLA’s expertise to resolve landowner concerns with the

“These are the standards our landowners insist on, that go well beyond anything the NEB or any new regulatory bureaucracy could ever dream up.”

replacement and the decommissioning of the old pipeline, Enbridge and CAEPLA were able to resolve landowner issues to such a degree that the project received 100 per cent support and sign-up by landowners on the project. With unanimous support of landowners, the result was precedent-setting construction practices, independent construction monitors, robust biosecurity standards and new pipe technologies topped with a renewed safety culture. All of which made L3RP the only major federal oil pipeline project approved and underway with the current government. As proven by the successful last weld on the Enbridge Line 3 Replacement Project in late spring, CAEPLA’s expertise and solution-based negotiating skills were invaluable in getting full landowner support for this replacement and expansion project. Again, with the unprecedented landowner agreement, CAEPLA’s independent construction monitors, advanced construction standards and engineering technology, L3RP is arguably one of the safest, soundest projects in history, anywhere on Earth. Doesn’t the Trans Mountain expansion project—and its captive landowners—deserve the same treatment? These are the values CAEPLA stands for, and that Enbridge embraced. These are the standards our landowners insist on, that go well beyond anything the NEB or any new regulatory bureaucracy could ever dream up. And these are the values and standards that need to be adopted on TMX.  Dave Core is managing partner at Dave Core and Associates, a consulting firm specializing in land management, property rights and agribusiness. He was president and CEO of CAEPLA from 2000 to 2018.

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B Y D AV E B A S PA LY

Insist on Independent Construction Monitors We are literally your eyes, ears and boots on the ground

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ow can landowners be sure their interests are protected during the construction of major pipeline projects? You might trust

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companies like Trans Mountain Pipeline and the oversight of the National Energy Board (NEB) to protect you and your lands. But the now-government-owned Trans Mountain is under great pressure to recoup huge capital costs as quickly as it can.

The NEB, meanwhile, is subject to so many interest groups that the voices of private landowners are too often drowned out. This is why agricultural property owners need the Canadian Association of Energy and Pipeline Landowner


iStock / eclips images

“You may spend years seeking remediation and compensation for garbage buried along the right-of-way or for weeds and pathogens introduced to your lands.” Associations (CAEPLA) and its independent construction monitors. Because if you trust either a federal government Crown corporation or the federal government’s energy regulator, without any means to hold them to their promises, you do so at your peril. You may spend years seeking remediation and compensation for garbage buried along the right-of-way or for weeds and pathogens introduced to your lands due to inconsistent application of biosecurity practices. You could fight a similar long and dissatisfying battle over loss of soils and land fertility. Most of these injuries can never be adequately made whole with money. Pipeline companies hire many experts to advise and supervise their environmental practices. These people know what quality work looks like. They know how to keep adverse impacts on your land to an absolute minimum. But, when schedule and budget concerns mount during the course of a project—due to poor weather, equipment breakdowns, operator error or stakeholder opposition—these experts’ voices are quickly quieted by contractors who have a schedule to keep and financial targets to reach. Who suffers? You do. Your interests take a back seat. Promises made to you are not kept with the kind of vigilance you experienced at the start of the project. The situation is not unlike what occurs at the professional levels of our national sport. Any hockey fan knows that an infraction that might be called as a penalty during November is often overlooked in the spring and playoff run to the Stanley Cup. Officials accept a “grittier game”—a less-safe

game for players and a less-fair playing field. Smaller, skilled players who brought extraordinary speed and beauty to the game in the regular season are marginalized in the playoffs. Perhaps you enjoy your hockey with a generous dose of brute force. But brute force exercised over your lands will leave you suffering every time. What can you do? Demand that a team of trained, experienced and vigilant independent construction monitors oversee the pipeline work on your lands. And insist that every entry onto your property—from initial survey and fencing till the last shovel of topsoil is replaced and producing a vibrant crop—is observed and documented by those monitors. Independent construction monitors verify that the promises made to you by companies and governmental agencies are promises kept—as faithfully in the 12th, 18th and 24th months of the project as they were in the first. These independent monitors observe every activity—from washing and bleaching equipment and removing and segregating soils to burying pipe and replacing the soils and vegetation above it. They take photos and submit descriptive reports every day to verify quality procedures and to catch any slip-up in accepted practices. The reports are provided to landowner oversight committees who meet regularly with representatives of the company. These groups have the power to correct practices and even halt the project until remedies are made. Most often, operators at the field level respond to the reports of the independent monitors and remedy bad practice immediately—before

a one-time error becomes habit and then turns into a systemic problem affecting acres of land and hundreds of landowners. Enlightened companies realize that this quick identification and remedy of sloppy practice saves them time, resources and money. Repairs made while crews and equipment are on-site saves costly remobilization to tear up and repeat work. Perhaps the most important savings achieved through independent monitors is not strictly financial. It is the savings to the company’s public prestige. Monitors’ reports verify that all conditions were brought to the agreed-upon standard during the project. All parties win. Since the spring of 2017, Infocus Management and Consulting has supplied independent third-party monitors to the Enbridge Line 3 Replacement Project (L3RP) in order to ensure the 125-page settlement agreement between CAEPLA and Enbridge is being followed. Independent Construction Monitors are literally your eyes, ears, and boots on the ground—the ground you’re counting on for the prosperity of your farm and family.  Dr. Dave Baspaly is an experienced corporate leader and a Certified Management Consultant with a remarkable ability to help people increase performance and achieve strategic goals. To learn more about independent monitoring or inquire as to how you can become a partner in advancing responsible pipelining, contact CAEPLA or Infocus Land Management (www.infocusconsulting.ca).

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S U B M I T T E D B Y T H E C A N A D I A N E N E R G Y P I P E L I N E A S S O C I AT I O N ( C E PA )

Pipeline Dialogue

One of the ways CEPA listens to different perspectives

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C

iStock CSA Images / iStock CSA Printstock

anada’s transmission pipelines connect Canadians to safe and responsible energy. Members of the Canadian Energy Pipeline Association (CEPA) reach a broad and inclusive geography with pipelines spanning 118,000 kilometres in Canada. Given that significant reach, it’s important for CEPA to engage with a broad and inclusive group of stakeholders. That is the main driver behind Pipeline Dialogue events. The first Pipeline Dialogue was held in Calgary in 2018, with a focus on what the pipeline industry can do to improve trust and transparency. One of the outcomes was a challenge to the industry to participate in, and articulate its place in, the future energy picture for Canada. Building on that feedback, CEPA held a second Dialogue in Montreal in March 2019. The topic this time was the future of energy in Eastern Canada (Quebec and the Atlantic provinces). Stakeholders from academia, think-tanks, landowners/agriculture and industry convened to explore a range of topics, including the extent to which eastern Canadians see a need to access oil and natural gas from Western Canada, and for further pipeline development.

No generic “eastern issues” Early in the conversation, it became clear that attitudes and perspectives toward oil, natural gas and pipelines differ across eastern sub-regions—in other words, there are no “eastern

issues.” Participants flagged multiple reasons for regionalized differences in attitudes and perspectives, including:

Differing definitions of energy, based on the provinces’ main sources of energy supply—e.g. hydro in Quebec versus fossil fuels in Nova Scotia and New Brunswick.

The cost of energy. For instance, in Atlantic Canada, where energy costs are high, there’s a greater interest in gaining access to alternative sources of energy, as well as ensuring stable energy pricing and reliable supply.

The way local politics, economics and safety-related incidents shape the attitudes of today.

Oil and gas development and climate change Participants also explored a range of topics, among them the question: “How can we continue to develop our oil and natural gas industry and still address climate change?” The topic resonated with participants and generated robust discussion. It became clear that more work needs to be done to create greater public awareness of the energy sector’s progress in addressing climate and environmental issues. In the words of CEPA President and CEO Chris Bloomer, “We must consider climate change in what we do, and we need to communicate more effectively about what the industry is doing to address the issue—including how we fit into the solution.”

A wealth of ideas to consider In addition to considering climate change in industry activities and decisions, three of the Dialogue’s many take-aways were:

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A call for regional and national leadership to build an energy vision and strategy to guide the oil and gas and pipeline industries into the future.

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The need for more effective education and communication as part of a joint industry effort to share a coherent, factual story about the industry’s breakthroughs, achievements, and commitments.

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The notion of creating an energy corridor, where energy infrastructure projects could move ahead without lengthy approval processes and have reduced environmental, social and economic impacts.

This feedback is extremely important as CEPA and its members look to the future. Canada is a world-leader in responsible energy production and transportation, and many opportunities exist as countries around the globe move toward a lower-carbon future. This is a critical time, and CEPA looks forward to continuing to engage with landowners, Indigenous communities, environmental advocates and industry leaders who can think critically, and who can challenge and communicate the narrative about the future of oil and natural gas in Canada. 

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BY IVAN WHITSON

CAEPLA Studies Agricultural Land Capability on Pipeline Rights-of-Way Soil surveys provide context and gauge risks

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ipelines are the centerpiece of Canada’s hydrocarbon distribution system. Where Rights-ofWay (RoW) cross lands used for agriculture, the question is, “Have the soils on the RoW suffered damage that will diminish their productive capacity, especially over the long term?” CAEPLA has provided me with

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a research budget to try to answer that question. Both industry and regulators commonly claim that RoWs are reclaimed to equivalent capability. However, there have been relatively few studies on pipeline RoWs and there are no reports in the literature of using capability ratings. The monitoring programs used for pipelines are intended to find areas in need of further reclamation effort. The qualitative

measures employed in these programs provide little useful data to assess land capability change. They can also generate false positives. A recently accepted publication in the Canadian Journal of Soil Science examined a sample of oil and gas well sites from southern Alberta and reported that soil quality was diminished and land capability ratings were reduced, even though these sites had received provincial certification.


iStock / FluxFactory

“Mitigations limit the degree of chemical and physical change in soil quality.”

Agricultural and capability ratings are used to rank soils in terms of productive capacity. I approached CAEPLA to discuss and demonstrate how land capability measurements could provide insight into reclamation effectiveness. When viewed in isolation, small changes in pH, clay or organic matter content, and salinity or soil density may be discounted. When integrated into measures of land capability, they

are a measure of cumulative effects. The research project will collect the data needed to derive these ratings and express change in terms of cumulative effect. We know that a variety of mitigations can be used to limit soil damage on agricultural lands. Soil surveys provide context and gauge risks. Topsoils are salvaged. Upper and lower subsoil can be separated to control salinity. Where soils compact easily, traffic can be halted in wet weather. Mitigations are intended to limit the degree of chemical and physical change in soil quality. The effectiveness of mitigations is intended to be measured by monitoring. Without monitoring, the effectiveness of mitigations remains unknown. The monitoring I will be doing is considerably stronger than that required by National Energy Board (NEB) post-construction assessments. This research will occur along the Enbridge mainline corridor using a select group of soils. About a half dozen of the 60 soil types identified for the Enbridge Line 3 Replacement project have chemical and physical properties that make them particularly sensitive to disturbance. They occupy about 20% of the 1,000 kilometre mainline corridor. These six types are “the canaries in the coal mine.” If these soils are undamaged, less sensitive soils are also unlikely to be damaged. If they are damaged significantly, then an additional group of soils could be sampled to estimate the extent of damage. Sampling is always meant to support conclusions about the areas that were not sampled. I plan to sample just six quarter sections chosen randomly from properties

volunteered by CAEPLA landowner members. Within each quarter, four transects across the corridor will include two reference sites and three pipeline RoW sites. The RoWs will include the decommissioned Line 3, the replacement Line 3, and a third pipeline of intermediate age. Topsoil depth, organic matter content, pH, structure, density, and salinity will be measured quantitatively. What are the benefits of this research? The results are an independent audit of soil quality on these RoWs. Results may provide insight toward the effectiveness of construction practices and mitigations used by industry over the last six decades. This research also audits the practices and policies of the NEB. For instance, what is the appropriate level of effort needed to quantify end-of-life liability for a pipeline RoW? This research will also provide a monitoring model that holds both industry and regulators to their promises.  Dr. Whitson is a senior soil scientist with experience in both the private and public sectors. His expertise includes soil classification and mapping, environmental assessment, hillslope hydrology, and measurement of soil change following disturbance. His graduate studies (University of Alberta) and post-doctoral work (Millar Western Forest Products) involved forest soil hydrology and nutrient transport. His work emphasizes high standards of quality, and, where possible, he has sought to publish in peer-reviewed journals. Based in Alberta, Dr. Whitson operates as I Whitson Innovations Inc., focusing on specialized aspects of soils science.

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BY C. KENNETH REEDER

Trans Mountain Approved. Again. What do Canadians have to show for a nationalized pipeline and a new regulatory bureaucracy for energy?

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n June, the Trudeau cabinet approved the Trans Mountain expansion project. Again. Of course, it’s a bit different this time around, because now Ottawa owns the pipeline.

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Federal officials say construction on TMX, a massive $7+ billion project, will likely begin in this year. Yet the British Columbia government vows to keep fighting all the way to the Supreme Court if necessary. There are very few people pleased with Ottawa’s nationalization of Trans Mountain, but one would hope

this shameful experience will give rise to some serious reflection about the errors that led to this mess. Ottawa wants us to believe they are making things better in Canada’s pipeline wars, but there is no real evidence of that. Consider Bill C-69, derided by industry as the “No More Pipelines Bill.” The new incarnation


iStock / wwing; iStock / Ajwad Creative

“Instead of enhancing protections for property rights, the government has expanded influence for various pseudo-stakeholders.”

of the National Energy Board—the creatively named Canadian Energy Regulator (CER) —isn’t much different and still distorts incentives and negotiating power between pipeline companies and landowners by allowing expropriation when it is alleged to be a “public necessity.” C-69 does virtually nothing to address concerns of landowners in this type of regulatory review. Instead of enhancing protections for property rights, the government has expanded influence for various pseudo-stakeholders, which actually undermines the property rights of landowners and pipeline companies more than ever. Meanwhile, the black hole of potential litigation known as “Duty to Consult and Accommodate” has been completely unaddressed in law. This issue was key in the Federal Court of Appeals decision to quash approval for TMX in 2018, as the federal government’s consultation with Indigenous groups was claimed to have been inadequate. But for something so important, no one really knows what it means. “Duty to consult” is not defined in the law anywhere. Legal clarity from Parliament has not been forthcoming, so judges—who may have their own political preferences—must determine whether a process has lived up to an undefined standard. Then there is climate change. You can have a reasonable debate about the degree to which climate change is natural versus man-made. But it seems we’re beyond the reasonable debate stage. The dominant narrative

of the federal government is that fossil fuels are destroying the planet. Every forest fire and every flood is attributed to humans affecting the climate. It’s a narrative driven more by propaganda than science. And even Andrew Scheer’s Conservative opposition party appears to accept the apocalyptic narrative of anti-carbon activists and the goals of the 2016 Paris Agreement. Will a pipeline company be encouraged to pursue major projects in this kind of political atmosphere? Unlikely. Amazingly, as if to preemptively undermine confidence in the government’s own decision, the House of Commons passed a motion the day before the TMX approval declaring a “national climate emergency.” I might be wrong, but maybe that kind of talk isn’t a big trust-builder for the oil and gas sector. Petroleum development is truly a global market. Every percentage point of return counts for investors, who include not just “corporate fat cats” but regular people like landowners, along with those dependent on massive pension funds. Talent and capital can move around with a lot of freedom. Ottawa is simply creating too much uncertainty and companies are allocating more resources elsewhere. Unfortunately, we have now come to a situation where, not only have no new protections been afforded for landowners who don’t want an energy infrastructure project on their property, but politics is freezing out aspiring pipeline landowners along with industry itself.

Two companies, Enbridge and TransCanada, burned through more than $4 billion trying to get Northern Gateway, Energy East, and Keystone XL approved. The former two are dead, with the third only being pursued because it has good regulatory prospects south of the border. In this setting, no one is surprised that capital investment in the Canadian oil and gas sector is estimated to be only $37 billion in 2019—down from $81 billion in 2014. And as you would expect, spending on pipeline landowner partners has plummeted to near zero. Not only is Canada poorer because Ottawa nationalized a major pipeline to “fix” a problem it created, but the country will become poorer still because none of the underlying issues are being addressed. It almost seems like impoverishment is Ottawa’s perverse master plan. They want to get past the embarrassing Trans Mountain situation as fast as possible and create a political and regulatory environment so hostile that no one will ever apply for a big pipeline project again.

Clayton Reeder is a Calgary-based financial analyst who provides mergers and acquisitions advisory services for mid-sized, privately held companies in Western Canada. He works with many clients in the oilfield services sector. He is also the editor of canadianmarketreview.com.

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B Y D AV I D C O L L

The Line 3 Reclamation Project What happens to your land after the final weld on Enbridge’s state-of-the-art replacement pipe?

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ith construction of the Line 3 replacement pipeline essentially complete in Canada, the process of reclamation— returning the land to its former use and productive capability—has begun in parts of Saskatchewan and southern Manitoba.

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Banister Pipelines is overseeing the work on behalf of Enbridge over approximately 280 kilometres from Regina, through the Vibank area, to Cromer, while SA Energy is overseeing the work over approximately 189 km from the Souris River to Gretna. Crews of around 400 began mobilizing in mid-June; weather permitting, the expectation is the work will be completed sometime in the fall.

“Our promise is to restore the pipeline right-of-way to as good or better condition than it was before construction, and to minimize the long-term impact to the land along our pipelines,” says Allen Sawatzky, manager of construction for the Line 3 Replacement Project. “Before construction takes place, we obtain regulatory approval and the environmental permits, which prescribe specific reclamation measures and


Photo courtesy Enbridge / Allen Sawatzky

“Our promise is to restore the pipeline right-of-way to as good or better condition than it was before construction.”

techniques proven to be successful in past projects.” Most reclamation occurs within the first year following construction. However, it can take longer, depending on weather and other environmental conditions. The first phase involves a more visible presence of workers. As the work winds down, crew sizes diminish as well. A critical component of right-ofway reclamation involves working

with landowners, from the outset of a project, to reach agreement on property-specific items that will be addressed during and after construction. “This could include things like repairing fences, driveways or landscaping, seeding hay land and native prairie areas, long-term erosion control measures in environmentally sensitive areas, and special care to be taken when working around livestock,” Sawatzky explains. During excavation for the Line 3 replacement pipeline, topsoil was separated from the subsoil to ensure the land remains productive for agricultural purposes after construction. The land is re-contoured to maintain drainage patterns, hay land and native prairie areas are reseeded, cultivated land is prepared for planting, and wetlands and watercourses are stabilized and revegetated to prevent erosion and ensure habitat is restored for the many plants and wildlife along the line. “Although most temporary workspaces will be allowed to grow back, we will generally maintain an approximately 12-metre-wide permanent right-of-way free of structures, trees and shrubs so that the pipeline is visible during aerial inspections and accessible in the case of an emergency,” Sawatzky says. To prepare the right-of-way for final reclamation, crews have been out and about in all of the 2018 construction areas. “We’ve got a full complement of staff out there doing general maintenance,” Sawatzky says. “Topping up gravel here and there, some erosion control, sign maintenance, gate repairs, hydroseeding — things like that,” he says. “We’re talking with landowners and staying on top of it.”

The Reclamation Process Enbridge takes numerous measures to minimize the long-term impact along pipeline rights-of-way. Here are the steps involved:

After pipe installation but prior to topsoil replacement, environmental crews respond to subsidence and/or drainage issues that create access problems for farmers or landowners, public safety issues, or to prevent environmental issues such as erosion;

Reclamation begins by removing construction debris, access ramps, and re-contouring the right-of-way to its original profile;

Once the subsoil on the rightof-way is re-contoured, the entire rightof-way is de-compacted where heavy equipment has been working to prepare the right-of-way for the replacement of stored topsoil;

Next, crews pull the stored topsoil piles back over the right-of-way and distribute it evenly over the area in which it came from preparing the areas for seeding and revegetation;

Finally, native prairie and hay lands areas are seeded, cultivated lands are straw crimped to prepare for the planting of the next crop, and pasture land fences are repaired. 

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BY NADIA MOHARIB

Practising the Law of the Land John Goudy’s roots pull him back to the land—but these days, he’s working it in a different way

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hen he graduated with a law degree in 2004, John Goudy knew he wanted to work in areas related to agriculture. Over the past 15 years, some of the Ontariobased lawyer’s work has been with The Canadian Association of Energy and Pipeline Landowner Associations

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(CAEPLA), where he has advocated for hundreds of clients across the country. Goudy’s practice focuses on areas of commercial and environmental litigation, expropriation law, energy regulation and regulatory offences— and he considers his CAEPLA work an important niche to be in. “There aren’t many lawyers who work in this area on behalf of landowners,” he says. “There are lots of

lawyers who work for pipeline companies, government, First Nations, energy transmission … but very few who work exclusively for landowners.” To say the 41-year-old brings some real understanding to the job wouldn’t be an understatement. On his family’s land in Ontario, there are four Union Gas pipelines and two water pipelines, which carry water from Lake Huron to the nearby city of London.


Photo by Brenda Coghlin Photography

“Companies are dealing with landowners more as business partners as opposed to patsies. There’s more respect now.”

Goudy’s grandparents, and then his parents, dealt with a variety of pipeline issues over the years, and this taught him that landowners “need to exercise whatever rights they might have.” Of course, early on, landowners didn’t know what all of their rights might be. And, though he believes that companies have come a long way since the 1950s, Goudy is also keenly aware of the need to keep these companies on track—something landowners have often done by leveraging the regulatory system as an ally. “I think companies have made incremental improvements as time has gone on,” Goudy says. “Companies might be doing [better] voluntarily, but its been as a result of landowners being involved.” Goudy says working with organized groups of landowners brings with it a unique “complexity and difficulty,” as well as challenges that may not appeal to some lawyers. “If you are working for a company, it is built into the cost of the project, whereas for landowners, it’s not their project and they are in a difficult position to pay a lawyer out-of-pocket for someone else’s project,” he says. While Goudy never tires of arguing before a judge or an energy board—be it national or provincial—his work isn’t all about those opportunities. “The grunt work you have to do in preparation for that can sometimes be difficult,” he says. As for his clients, Goudy says they may have similar goals, but they can be very diverse in perspective. The majority of landowner clients—even those with multiple pipelines on their property—have not had many

dealings with lawyers, nor have they been involved in a legal dispute. “Most people—unless they have had experience with this before— don’t know what to expect and don’t know what the real power dynamic is and what rights they have and don’t have. Some people come in feeling very intimidated and are overwhelmed by being presented with a lot of paperwork and information from a company,” he says. “At the same time, there are a lot of people who feel very confident—maybe even overconfident—about their ability to deal with a big company or big project, and they may overestimate their bargaining leverage.” Ultimately, much of Goudy’s work with CAEPLA comes down to ensuring companies and government are “playing by the rules” rather than browbeating landowners. “Landowners and the general public, a lot of times, just don’t know what the rules are. I like holding companies and government to account,” he says. “And where they are attempting to use their power and authority—and overstepping their bounds, pushing people around to get a project through—I like holding them in check and ensuring they are playing fair.” And there are many issues, he points out, that still need addressing. For example, the minimum depth of cover over pipelines must be met, but many companies are voluntarily burying at a depth exceeding those required. More work also needs to be done on issues such as pipeline abandonment and decommissioning, Goudy says. Nevertheless, thanks to the pipeline landowners’ movement, he says,

“Companies are dealing with landowners more as business partners as opposed to patsies. There’s more respect for landowners now.” Goudy approaches his law practice as he does his personal life: with the intention to work hard and be fair. “As a lawyer, my primary goal is to do a good job for people and to be able to say that I actually improved the situation for someone. Unfortunately, that’s not always possible, but what really guides me in my work is a concern to give people good value for money and accomplish something for them,” he says. On a personal front, he says family and faith are important. Goudy, his wife and their three children live on a farm located just a few miles away from where his parents reside—and raised him. “My dad is still very involved in pipeline landowner issues. I think he likes that I’m involved in this, too,” he says. While you won’t catch Goudy savouring shop-talk at the dinner table—“I like to avoid talking about it as much as possible”—farming is fair game. “If I could just be a farmer, I’d just be a farmer,” he says. “Unfortunately, time is not always on my side when I’m trying to run a legal practice and I don’t get to do as much farming as I’d like to. Cash crop does not pay as much as legal work.” 

Nadia Moharib is a multimedia news reporter who loves to serve as a voice for the underdog and tell the story behind the story. Always curious, she seeks opportunities to make a difference.

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BY TIM MOEN

Andrew Scheer’s $100 Billion Energy Corridor is a Promise to Violate Property Rights Government by nature is all about expropriation

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“The CPC energy corridor is a promise to Canadians that property rights will be violated.”

iStock / alxpin

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ndrew Scheer announced recently that a Conservative government would create an energy corridor across Canada to break up pipeline gridlock and provide a transmission route for energy. The plan is based on a paper by G. Kent Fellows from the University of Calgary. Fellows estimates the plan would cost $100 billion and take decades to complete, and that, based on increased GDP, the cost would be worth it. If this is such a great plan, why doesn’t an entrepreneur do it? Surely there would be huge profits to be made by negotiating with landowners and government jurisdictions across Canada to create an energy corridor. Surely Scheer or Fellows would put their money where their mouths are and put their skin in the game for a huge payday if they thought this was such a good idea. The answer has to be that the cost is greater than the payoff. How can you tell whether a green energy project or an energy corridor is a good idea? The first clue is that it doesn’t require the government to tax productivity to subsidize. If a project can generate more than it produces, it doesn’t need government handouts—if it does need government handouts, then we are paying for wealth destruction. That’s not to say that there are no profitable energy corridors or green energy projects. Canada is full of energy corridors and green energy

projects. Some were done through expropriation or the threat thereof, but none needed to be. Private energy transport companies are capable of securing land without resorting to expropriation, which is just another kind of subsidy, another kind of wealth redistribution. But government, by nature, is all about expropriating and redistributing wealth. What do you think will happen to private landowners—be they farmers, ranchers or energy transport companies themselves— who turn down the government’s offer? A quick glance at the way provincial energy Crown corporations in British Columbia (the Site C Dam) or Manitoba (the BiPole III transmission line) treat landowners will give you a pretty good idea. I sympathize with pipeline gridlock. It seems to me that routes have been negotiated and that property rights of pipeline owners are being violated by activist blockades and by provincial and municipal governments. Members of Confederation have a duty to allow the free flow of goods and labour through their jurisdiction, and they aren’t living up to their end of the bargain. The federal government has a role to play in ensuring that members of Confederation honour their obligations and find ways to accommodate pipelines through government-controlled land, but an energy corridor is outright government ownership of the means of production and can only be achieved by violating property rights.

Western civilization created a fabric for the greatest prosperity in human history. This flourishing was not created through government action. It is the actions of individuals with property rights that have created the wealth we enjoy. We have flourished in spite of government action, not because of it. The Trudeau government has done enough damage to the fabric of property rights and individual liberty that supports us. We don’t need another party promising to erode this fabric. I wonder if Scheer has given any thought to what would happen if his beloved energy corridor came under the control of an NDP or Green Party government in the future. The CPC energy corridor is a promise to Canadians that property rights will be violated and corporate subsidies will ramp up, that we can expect a command economy no matter which party holds power, and that nations are built through forced collectivism rather than individual cooperative effort. 

Tim Moen is a paramedic, writer and entrepreneur. Tim grew up on a farm in northern Alberta and became leader of the Libertarian Party of Canada in 2014. He has made regular appearances on FOX News and the pages of the Huffington Post and Post Millennial.

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Visit caepla.org

Read the latest articles, discover upcoming community events, connect with other landowners and learn how CAEPLA is on the front lines of the fight for your property rights.

www.caepla.org

Changing land management as we know it Land agents have worked on behalf of oil, gas and mining companies for over 150 years. While they are an essential element for landowner relations, there is a problem with the underlying premise from a land owners' perspective. A land agent works for the company that hired them - not the landowner. As a result, how can they truly represent the interests of the landowner independently or objectively? What if instead of maintaining a land management department within a company, a neutral third-

GROW LEARN LEAD

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management consulting

party land agent was hired equally by both the landowners and the company? This approach reduces the perceived one-sided bias and creates true shared ownership and control. In partnership with CAEPLA, introducing Infocus Land Management's Independent Construction Monitoring - The right way to conduct landowner relations. To get involved in the future of land management, or to learn more about this unique service, please contact CAEPLA or Infocus Land Management (www.infocusconsulting.ca).

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BY ANNETTE SCHINBORN

Are Property Rights a Women’s Issue?

iStock / pixdeluxe

CAEPLA stands on the shoulders of pipeline landowner movement pioneers like Jean Lewington

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Pipeline Landowner Associations (CAEPLA), we have seen it cost landowners far more in terms of stress, time, energy and money when an energy company or government knocks on their door to say they want access for a right-of-way across their property. Adding to that stress is the threat of expropriation if the landowner does not want to accept the terms the company offers. This affects the whole family. And women often intuitively understand the threat to their family, their children, the stress of their spouse. Sometimes it is only the woman in the family that truly understands the significance. Perhaps it is the “nesting instinct” biologists talk about. Over the summer, Dave Core and I visited with a family who, five or six years ago, had been expropriated. A huge mess had been made of their land. I recall the first time we drove into their yard and knocked on their door. Thinking that we were yet another land agent from the company, the wife opened the door and was not happy. Not only was their property threatened (and, along with it, their

iStock / Simon Skafar

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e hear a lot about “women’s issues” these days, but are property rights among them? As you may have guessed, I’m of the view that property rights are everybody’s issue. We all own property. It isn’t just the farmer or rancher who owns acres of land, it is all of us—whether we own farmland, a house in the city, an acreage, a condo or any property at all. And when our property is threatened or taken from us, we feel violated, no matter how insignificant it may seem to others or those who may in fact be enforcing “legal” theft. This may seem a little silly, but recently I was in a grocery store parking lot. When I came out of the store and went to put my groceries in the back of my car, I noticed that my license plate had been stolen. It cost me time, energy and money to replace it, because someone violated my property rights. That’s on a small scale. At the Canadian Association of Energy and

farming business), but the pressure on their family was intolerable. She joked to Dave and me that she needed to buy her husband wrinkle cream, as the stress had aged him as they went through the situation. In Manitoba, on Manitoba Hydro’s Bipole III project, the provincial Crown expropriated fee simple title of over 200 farm families and then held them hostage by saying they could get their land back if they signed the woefully inadequate easement agreement that the provincial power monopoly offered. Many landowners, not being able to handle the stress, signed the agreement just to get title of their land back. Other landowners have courageously fought on and held out to this very day. CAEPLA has stood with and continues to assist them as they man the ramparts for their property rights. One lady on the project, in an effort to protect her land, drove a tractor across an approach in order to block access to her land and keep the contractors off. She was fighting for biosecurity cleaning protocols to protect her land from clubroot, noxious weeds, soil compaction and rutting during wet weather—to name just a few issues. She stood up for her property in the face of bullies who made snide remarks and threats. A pioneer in her efforts in fighting alongside her husband for the respect of their property rights was Jean Lewington. I personally met Jean in 2016 when she invited Dave Core and me to her farm. Jean and her husband were at the forefront of the pipeline landowner property rights movement when, in the 1970s, they mortgaged their farm


“The pipeline landowner movement needs more women to stand up for the property rights of all Canadians.”

to take the pipeline company that had damaged their property to court. (After their successful court case, Natural Resources Canada rewrote regulations so that landowners could not take a company to task before a court of law in defense of their property. These changes left landowners with “no rights and no remedies outside the National Energy Board Act.”) Jean and Peter hired soil specialists and other experts and personally funded research to mitigate the impacts of pipelines on farming, raising the environmental standards in pipeline construction. Jean remained a strong supporter of CAEPLA to the very end, passing away at the end of May this year, at the age of 99. Her son, Roger, attended CAEPLA’s workshop in Ontario at the beginning of April, bringing greetings from his mother, who wanted to attend, but whose body was not strong enough. As has been our experience at CAEPLA, the issue of property rights is not just for the male members of the family. And in ever-increasing numbers, women own and operate farming/ranching operations and ag businesses. One stellar example is CAEPLA board member Stephanie Fradette. Stephanie works tirelessly on the family ranch, branding cattle and making hay as well as taking her children to swimming lessons, preparing meals … and defending property rights. I met Stephanie in 2010 when she contacted CAEPLA regarding a pipeline project that was proposed to cross her property. Despite having two pre-school

children as well as an eight-month-old baby, Stephanie organized landowner meetings for CAEPLA reps to speak at. These information sessions allowed her neighbours getting the pipe to understand the implications and, later, to work together to get an easement agreement that protected their property. She participated in the National Energy Board (NEB) hearing on the project, even crossexamining the company lawyers to hold them to account. The company wound up going around Stephanie’s land. But she continued to work for the group and with CAEPLA to negotiate a good agreement for all the landowners who chose to cooperate in defense of their property rights. The brush with that particular project is a big part of why Stephanie understands the importance of establishing strong agreements. It is also why she insists on protocols to set higher standards and protect landowners into the future when the next project is proposed. She is pro-development, pro-business, pro-property rights. The nurturing instincts of women seem to give them the edge in fighting for the rights that will protect their family for generations to come. The time and energy invested by Jean and Stephanie will benefit all Canadian families, not just their

own. They are everyday people whose determination not to be taken advantage of, and to instead protect their family and their property, is a defining characteristic enabling them to stand up for what’s right in the face of seemingly insurmountable odds. The pipeline landowner movement needs more women to stand up for the property rights of all Canadians. Yes, we are all often very busy with our jobs and our families, but when we lose our rights it takes double or triple the time, energy and cost to get them back. Back in the ’70s, Jean and Peter were on their own. Through their courageous efforts and those of many landowners following in their footsteps, landowners like Stephanie now have CAEPLA in your corner and on your quarter section. We stand on the shoulders of the pioneers in the pipeline landowner movement—your pipeline landowner movement. Our decades of experience mean you don’t have to re-invent the wheel the next time a government regulator tries to grab your land.

We are only an email—admin@caepla.org—or a phone call away: 306.522.5000. Check out our website at caepla.org.

Annette Schinborn is chief executive officer at CAEPLA, having served previously as COO and director of landowner relations. Before joining the team at CAEPLA, Annette worked with grassroots non-profits including the Canadian Taxpayers Federation, the Prairie Centre and the Western Canadian Wheat Growers Association. She has worked closely with farmers, ranchers and other landowners on issues such as tax and agricultural policy, energy transport and property rights.

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Remembering Jean Lewington, a Pioneer in the Fight for Property Rights Jean Lewington, a woman who was very active fighting for property rights, passed away at the end of May 2019. She was 99. Jean and her husband, Peter, had a tremendous influence on the pipeline landowner movement. This pioneering couple have been mentioned in the pages of the Pipeline Observer before—in “The Book that Inspired the Creation of CAEPLA” (Summer 2016) and “A Solution to Pipeline Industry

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Paralysis” (Fall 2018). During the Second World War, Jean enlisted in the Women’s Royal Navy Service, where she served as a radar operator and ambulance driver. With that kind of courage, we can easily understand why she, and Peter, would never back down from a

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fight with an energy company or the government. In July 2016, Dave Core and I were invited to visit Jean at her home at Larigmoor Farm (she and Peter purchased the Ontario property in 1952, soon after arriving in Canada). During our visit, it was immediately apparent that, even

at the age of 96, Jean was still a formidable force. Challenged by arthritis in her final years, Jean got around her farm in a golf cart. She loaded Dave, me and her beloved dog, Willie, into her cart and sped off across the fields to show us the right-of-way that had compromised their land back in the 70s. She and her husband had fought hard to protect their land along that easement. Not only did they want restitution for what happened to their property, they wanted changes to construction practices that would prevent such damage happening again. “Look,” she pointed out to us, “you can still see the difference in the quality of crops grown on the right-of-way compared to the rest of the field.” With great determination and hard work Jean and Peter, along with Stu and Joycelyn O’Neil, had mortgaged their farms to sue the pipeline company that had harmed their land. An avid proofreader, editor and advisor, Jean was a force to be reckoned with as an ally to Peter while they engaged in that precedent-setting court battle. She was also instrumental in the writing of the Lewingtons’ book, “No Right-of-Way,” which detailed their epic effort on behalf of pipeline landowners. Jean was an inspiration. Her passionate fight for property rights will be her legacy. 

Image supplied by CAEPLA

Jean (bottom left) with Dave Core (bottom right) and Annette Shinborn (top right) at Larigmoor Farm.


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B Y J O N AT H A N W O O D

How Federal Regulations Pre-Empt Real Property Rights A Montana case is no surprise to Canadians who are familiar with how regulatory regimes protect industry from landowners

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or more than a century, a copper smelter in Opportunity, Montana, emitted thousands of tons of toxic metals, polluting its neighbours’ properties and creating effects still felt today. In a few months, the Supreme Court of the United States will consider whether those neighbours can hold the polluter responsible for the effects, or whether a federal law intended to encourage environmental remediation actually discourages it. In Atlantic Richfield Co. v Christian, the neighbours have sued the current owner of the smelter seeking a variety of compensatory damages, including funds to remove arsenic and other pollutants from their properties. Such claims are an important means for property rights to promote better environmental outcomes, by requiring

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polluters to account for the costs of their activities imposed on others. The company (Atlantic Richfield Co.) responds that its neighbours have no right to seek that compensation. Previously, it complied with an EPA-ordered cleanup of the properties and argues that, under the federal law that empowers EPA to force such cleanups, the company can’t be required to fund any further remediation. Its neighbours’ common-law property rights, in other words, are pre-empted by federal law. The federal law—the Comprehensive Environmental Response, Compensation, and Liability Act, also known as Superfund—allows EPA and others to clean up polluted properties

at the expense of those responsible for the pollution. Thus, there’s at least some tension in the argument that a law meant to facilitate remediation actually blocks it. The conflict isn’t unique to Superfund. Regulated parties have long argued that their federal permits under the Clean Air Act, Clean Water Act, and other laws protect them from their neighbours’ property-rights claims. For instance, air-pollution emitters have argued that, having received a federal permit, they cannot be made to do more. So far, that argument has received a cold reception in state and federal courts. The argument has fared no better under Superfund. This is due, in

“Regulated parties have long argued that their federal permits protect them from their neighbours’ property-rights claims.”


“Such claims are an important means for property rights to promote better environmental outcomes by requiring polluters to account for the costs of their activities imposed on others.”

part, to Congress’ general practice of declining to explicitly pre-empt more protective state laws in federal pollution statutes. Instead, Congress generally preserves state authority. In Superfund, for instance, Congress provided that “Nothing in this Act shall be construed or interpreted as pre-empting any State from imposing any additional liability or requirements with respect to the release of hazardous substances within such State,” and that “Nothing in this Act shall affect or modify in any way the obligations or liabilities of any person under other Federal or State law, including common law, with respect to releases of hazardous substances or other pollutants or contaminants.” Yet, the United States and Atlantic Richfield respond, Congress didn’t mean to allow states to actually frustrate Superfund’s purposes. The Montana Supreme Court, siding with the neighbouring property owners, denied any conflict between the law’s goal of cleaning up polluted sites and the neighbours’ goal of cleaning up a polluted site. The Court also focused, correctly, on the constitutionally protected property rights at stake in the dispute, noting that nothing in the property owners’ claim for restoration damages “stands as an obstacle to the accomplishment of congressional objectives as encompassed in CERCLA,” unless Congress’s objective was to condemn, in perpetuity, the private property of an individual property owner because that property

happened to have been contaminated by a third party. The Supreme Court’s decision to hear the case is curious. There is no conflict among the lower courts, a key consideration for the court. The United States opposed review, suggesting that, even if there is a conflict between Superfund and the neighbours’ claims, the conflict is not very significant. And the case is still at an early stage, meaning the Court will have another opportunity to review it later, with the benefit of a decision on the company’s actual liability. The Supreme Court reverses most of the cases it takes, having done so in 70% of cases during the last decade. So the decision to review the case could be a signal that the Court anticipates that it will reverse the Montana Supreme Court. However, a recent decision makes that less likely. In Virginia Uranium, Inc. v. Warren, a fractured court rejected the argument that a federal law governing uranium refining pre-empts state regulation of uranium mining. The lead opinion, by Justices Gorsuch, Thomas, and Kavanaugh, suggests that pre-emption should be extremely rare unless a statute expressly limits state authority. That logic would have even more purchase where, as under Superfund, Congress has explicitly preserved state authority. But the Supreme Court may be hesitant to reverse for another reason, hinted at by the Montana Supreme Court’s quote above. The right to

protect one’s property from trespass or nuisance is a core property right and extremely valuable. If CERCLA and other laws are interpreted to broadly take away these rights, it would expose the federal government to tremendous liability under the Takings Clause, which requires the government to pay just compensation when it takes property through condemnation or regulation. The Supreme Court has previously held that where a court interprets the law to upset existing property rights, it can commit a “judicial taking,” which the government must pay for. Since the interpretation would affect every property owner whose land is polluted by a third party, this could be the largest taking in U.S. history. Courts should be extremely hesitant to interpret laws to impliedly destroy so many property rights. 

Jonathan Wood is a Property and Environment Research Center (PERC) research fellow and an attorney at Pacific Legal Foundation, where he litigates environmental, property rights, and constitutional cases. Wood is the author of six law review articles on endangered species, federal lands, and other environmental issues, as well as dozens of articles for the popular press, including pieces for The Wall Street Journal, The Washington Post, and National Review.

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BY MARTY GOLD

The Latest Threat from Manitoba Hydro

Transmission line to Minnesota carries serious risk to corridor residents

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n January 2019, Manitoba Hydro got approval from the National Energy Board (NEB) to construct and operate a 500 kV power line— the Manitoba-Minnesota Transmission Project (MMTP)—from the Dorsey Converter Station to connect to a new Great Northern Transmission Line in Minnesota.

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The $4.5 billion international power sale was considered a crucial element for the justification to build the provincial power monopoly’s BiPole III, a boondoggle that ended up costing over $5 billion—more than twice the original estimate. Not only have project overruns resulted in jacked-up Hydro rates for users, Manitoba Hydro also used predatory expropriation tactics to bulldoze the property (and property rights) of over

100 landowners through prime agricultural land in the path to the border. Jurgen Kohler, chair of the Manitoba BiPole III Landowners Committee (MBLC), is a grain and oilseed farmer who foresees continued abuse of landowner property rights by Manitoba Hydro with MMTP while the Progressive Conservative government of Brian Pallister looks the other way. “Our premier had to go to Ottawa to meet with Prime Minister Trudeau


Alamy / Danita Delimont

“Nobody in government has the gumption to stand up to Hydro and say, ‘Negotiate, not expropriate.’”

to get this approved by cabinet,” says Kohler. “The big question is how will landowners be treated, especially in light of the NEB decision having a couple of landowner-friendly recommendations.” Kohler cautions that, based on landowners’ experience dealing with Hydro in the path of BiPole III, “They have to get organized quickly, and form a partnership with the Canadian Association of Energy and Pipeline

Landowner Associations (CAEPLA), who have experience fighting for your property rights.” He notes that lawyers in Manitoba “often have business dealings or standing contracts with Hydro” and are therefore compromised. “If landowners don’t reach out to CAEPLA, they’ll be picked off,” Kohler says, explaining that Hydro just wears people down by constantly showing up at their door, nagging them to sign. It can be intimidating. “Get yourself prepared, because you don’t want to be dealing with Hydro individually. That’s their game, to offer incentives and gloss over the issues. ‘Sure it’ll be taken care of,’ they’ll say, ‘Just sign the easement.’” Kohler has first-hand experience with the liability that the power company shifts to farmers. A brush with an old wooden pole that Hydro had to replace was followed by a year of silence, despite Kohler asking for specs. Then his insurance company got a replacement bill—for $36,000. So much for signing easements. “Those are huge structures, with huge power going through those lines. If something happens you can be sure the bill won’t be 36k, it’ll be astronomical!” Kohler says. “The insurance company might cover it the first time, but, on average, the premium for people near the hydro line is $1,000 a year higher. There’s so much risk Manitoba Hydro pushes onto the landowner that they aren’t aware of.” The biggest problem Kohler and landowners have faced is the lack of respect for the concept of property rights and fair negotiations. This he blames on the Pallister government effectively giving Crown expropriators licence to kill property rights and

abuse landowners. He cites the recent land-grab of seven acres in Carman, MB, for a dubious health-care campus project as another example. “There’s something about Hydro that they control the government in a way that’s just not acceptable. It seems to me Hydro calls the shots. Nobody in the government has the gumption to stand up to Hydro and say, ‘Negotiate, not expropriate.’ In BiPole III, the corridor was 66 metres wide and you look and go, ‘Why? ’ Because it was easy for them to take more [property than was needed]. They have that power in legislation and aren’t afraid to use it, just like in Carman.” The MLA for Carman, Blaine Pedersen, now Minister of Growth, Enterprise and Trade, receives special scorn from Kohler’s group. “Blaine threw us under the bus. He used us in the Legislature (in question period) to raise his profile. Pallister campaigned on how terrible we were treated by Hydro, but when they got into power, it was all for nothing. Pallister is supposedly all pro-small business—what are we? We should matter the most, especially to a premier like Pallister who comes from a rural background (Portage la Prairie). He just puts his head in the sand and lets Hydro do their thing.” And with a second mandate, Kohler doubts the Pallister government will become any more respectful of property rights. 

Marty Gold is a Winnipeg-based writer and broadcaster. He is the editor of TheJ.ca.

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Are Ancient Arrowheads Enough to Kill Property Rights in Canada? Emerging heritage site strategy by Indigenous activists threatens just that

iStock / treasurephoto

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n June 2019, CBC reported that Saskatchewan First Nations leaders wanted the construction of a municipal road that was being built across privately owned land stopped. The reason given was that a portion of an obsidian arrowhead had been found on the privately owned land close to the Red Pheasant Reserve. (That reserve became rather well-known recently, as the home of the late Colten Boushie). Although arrowheads are commonly found in almost all parts of Canada,

this partial arrowhead was unusual in that it was obsidian—a stone not found locally. It is possible that the obsidian, which is actually a volcanic glass, came from the Yellowstone area in what are now the states of Wyoming, Idaho and Montana. Yellowstone Park is one giant volcano. The significance of the find to the local Indigenous people is that it might be evidence that tribes from various parts of what is now North America were trading with one another over long distances at least 10,000 years ago. However, obsidian occurs naturally from Alaska to Mexico and west of the Rocky Mountains, so it might have

come from an area closer than Yellowstone. Obsidian arrowheads have also been found in many other parts of North America, so the Saskatchewan find was really not that unusual. In fact, that is basically what the provincial authorities said when told about the finding of the arrowhead. They had no concerns over continuing construction. The local people were given that information, but insist that construction be halted anyway. It goes without saying that if construction of a road, or other project, was halted whenever an arrowhead was found there would be no construction possible in this country.

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“Property rights, protected by the Rule of Law, are vital to our continued well-being.”

We know that Indigenous people have been on this continent for at least 15,000 years, since their ancestors crossed what was then a land bridge from Siberia. We also know that, at least when Europeans first arrived here in the 15th century, there were at least 200,000 Indigenous people surviving here as hunter-gatherers. We don’t know exactly when bows first came into common use in North America. However, as use of the bow in Africa has been traced back more than 10,000 years, it is reasonable to speculate that some version of the bow and arrow had probably been used by the Siberian ancestors of North American Indigenous people, and some version of the bow was probably brought with them over the land bridge. What these highly speculative numbers mean is that many millions — and maybe billions—of arrowheads are scattered around North America. In fact, if you take a shovel and look for an arrowhead on a tramp through a valley, forest or plain, you are likely to find one. They are extremely common. Flint and obsidian specimens will be harder to find than other rock varieties, but they show up quite regularly. Burial sites are also very common. Since most of Canada’s Indigenous tribes were semi-nomadic, the dead were buried where the tribe was hunting or scavenging for food at any particular time. If a family group or

tribe was following the caribou, for example, the dead would be buried close to where the death occurred. There were no hearses, funeral homes or cemeteries. This means that bones can be found almost anywhere. If every spot where a human bone or fossil might be found is declared to be a sacred site, and untouchable to farmers and developers, there could not possibly be any commercial use of any territory where semi-nomadic people had hunted—namely, everywhere.

Relying On Experts All of this means that we must rely on archeologists and other experts to tell us which finds are significant, and which finds are not. We do not have the expertise to make that determination, and neither do the residents of the Red Pheasant Reserve. In many cases these experts will consult with Indigenous elders, just as experts would consult with knowledgeable local people if the bones of any non-Indigenous people are found in an effort to determine which finds are significant enough to order a halt to construction or development. The key here is that common sense must prevail. Yes, historically significant finds should be preserved —regardless of whether these are Indigenous artifacts or artifacts identifiable to any other group. We should let trained people decide which finds are significant, and which finds are

not so important that they should halt necessary economic activity. When doing so, we should bear in mind that no one ethnic group is more important than any other. We should also remember that the wealth of this country has been built on the exploitation of its many resources. The prosperity we have achieved has been the result of harvesting not only our grain, but our forests, mines and oil and gas fields as well, and our continued prosperity depends on doing the same thing. Obviously, all of this has to be done in an ecologically sustainable way that also respects the rights of people who use the land that is needed for farming, ranching and mining. No one group can be allowed to prevent essential economic activity from taking place. And that is exactly what has been happening in Canada for the last decade, since the Supreme Court’s Haida Nation case gave First Nations the right to be consulted about resource development that is taking place on Crown land that is considered by those First Nations to be its “traditional territories.” That well-intentioned decision has been aggressively exploited by First Nations, with the tax-paid assistance of some of Canada’s best lawyers. The result—when combined with the current federal government’s almost impossible ecological expectations— has been stagnation in the resource

“There are today huge claims against private property in British Columbia that have the potential to fundamentally alter the very notion of the property rights upon which our economy is built.”

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“The Indian Act must be repealed, Indigenous peoples compensated for surrendered rights, and Canadians all made subject to one set of laws.”

industry, and an almost hopelessness in the business community about Canada as a place to do business.

THE DANGERS OF TOLLGATING “Tollgating,” or the deliberate holding up of legitimate resource development until one’s price has been met, acts like a punitive tax on development at the same time as it results in uncertainty in the business community. “Smart money” begins to drift south. The arrowhead incident in Saskatchewan is simply typical of the unreasonable position now taken by so many First Nations leaders and communities. There is a sense of entitlement that verges on arrogance. Communities that are almost completely dependent on the taxes paid by others spurn the very economic activity that supports those same communities. Under the guise of protecting this or that “sacred” site, or because of a belief that they are “keepers of the land,” they refuse to cooperate with necessary development—or they refuse to cooperate unless their price is met. All of this is extremely damaging to the economy of the country. When combined with the posture of the current Liberal government in Ottawa —which is antithetical to almost all western resource development—it risks the first-world economy bequeathed to us by our “settler” ancestors. Those “settlers” were the ones who created all this wealth. They built this country, and they did so by the careful exploitation of our vast store of natural resources. And the foundation of all of this

was our modern notion of property rights. The right to own property is a right that developed over thousands of years in the West, and it has given us both the certainty and incentive necessary to power our modern western economy. Property rights, protected by the Rule of Law, are vital to our continued well-being. We cannot afford to have notions like “duty to consult” or other notions eat away at these fundamentals. However, it is deeply worrying that property rights and the concept of Crown sovereignty on public land are both being eroded by our current federal government and our activist Supreme Court. Because the current federal government and our Supreme Court are focused on “reconciliation,” Indigenous land claims have been expanding at an alarming rate. There are today huge claims against private property in British Columbia, as well as massive treaty claims in Ontario (and soon throughout the Prairie provinces and the north) that have the potential to destabilize the economy of the country, and fundamentally alter the very notion of the property rights upon which our economy is built. The destabilizing effect of highly ambitious Indigenous land claims are greatly exacerbated by the almost impossible ecological requirements now imposed by a highly ideological federal government that uses both strategies in its thinly disguised plan to permanently snuff out Western Canada’s vital oil and gas industry. All of these developments may have this country heading toward some kind of existential crisis that threatens us with years of constitutional turmoil

ahead. If that is the case, and the country will once again be required to negotiate terms upon which everyone can live, I suggest that three things are now abundantly clear:

1

It was a mistake in 1982 to forego writing “property rights” into our Constitution. Any future Charter of Rights must enshrine property rights as a fundamental right to be protected.

2

It was a mistake in 1982 to grant special rights to any one group of people. In any future negotiation, The Indian Act must be repealed, Indigenous peoples compensated for surrendered rights, and Canadians all made subject to one set of laws.

3

In 1982, it was a mistake to remove responsibility for issues such as Indigenous rights from the people’s elected representatives and delegate responsibility to the courts. All substantive matters must in future negotiations be left with a Parliament and Legislatures to make laws and courts to interpret those laws.

Arrowheads are interesting reminders of Canada’s past. Now it is time to think of our future. 

Brian Giesbrecht is a retired judge and a senior fellow with the Frontier Centre for Public Policy.

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BY DALE SWAMPY

What Would Indigenous Ownership of Trans Mountain Look Like? Equity stake in the pipeline is key for landowners, Indigenous and non-Indigenous

O

ver the past decade, Canada has faced more challenges against economically crucial pipeline development than any country in the world. Canadians who are not involved in

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the oil and gas industry tend to believe there is no real need for the Trans Mountain expansion project (TMX). However, if you speak directly to affected stakeholders of this pipeline—including Indigenous leaders, government representatives, leaders of the oil and gas industry, and private

landowners—most of them will tell you that building TMX is not only good for Canada, but good for Indigenous communities. They will also tell you that they want two things from TMX: to maximize their benefits from the project, and to maintain some level of control


Alamy / igor kisselev; iStock / Yobro10

“In order for landowners and Indigenous leaders to maintain a reasonable level of control, they will need to own part of the project.” over the project to ensure that integrity issues and environmental protections are properly dealt with and maintained. Government officials will count on regulations to maintain their need for control. But in order for industry leaders, landowners and Indigenous leaders to maintain a reasonable level of control, they will need to own part of the project. I believe the only way to successfully proceed with the construction and operation of TMX is to have all three of these stakeholders involved in owning the pipe. It may seem like an exercise in futility to suggest that a model can be created that will satisfy all stakeholders, but leaders like those within the National Coalition of Chiefs (NCC) not only believe it is possible, they are also willing to lead the successful implementation of the final model. Indigenous leaders and private landowners have similar interests: they both feel they have an inherent responsibility for the long-term safe-keeping of their lands. So, when a pipeline or other major infrastructure is developed on their lands and territory, they feel helpless when all they get from the project is a one-time payment and they have to stand by for the rest of the 30 years of operations without a say in how the project functions. Ownership in the project will allow them to have a say and to better understand how the project operates and protects all of our lands. In order to acquire ownership,

Indigenous communities and private landowners need a helping hand. Most do not have the 30 or 40 percent cash down-payment needed to finance their equity share in the project. This is where government and private industry can provide solid financial consideration. The Northern Gateway pipeline model showed us how major oil producers and major pipeline companies, like Enbridge, can work together to arrange the financing for Indigenous communities to purchase 33 percent of the Northern Gateway Pipeline. In the case of TMX, major oil producers can come together with a major pipeline company, like Kinder Morgan, to develop a financing package that will enable the Indigenous communities to own as much as 33 to 50 percent of TMX while the remaining shares will be owned by the landowners, oil producers and the major pipeline proponent. The financing package will include equity grants from both the oil producers and contributions from Alberta’s Indigenous Opportunity Corporation. Share ownership for Indigenous communities will be allotted based on their levels of impact. For example, the share offering can be divided into four groups or levels. Level 1 will be given the largest proportion of ownership. This level will be offered to First Nations and Métis communities whose lands are crossed by the pipeline. Level 2 will be given to those communities whose reserves and lands lie within an 80-kilometre radius of the pipeline route. Level 3 shares will

“It is time for industry and government to recognize private landowners’ rights to protect and manage their own lands.”

be offered to First Nations and Métis communities within Alberta and B.C., and the final Level 4 shares will be offered to First Nations and Métis communities who wish to participate from across Canada. Indigenous communities that participate can be involved in a newly established TMX Indigenous community ownership group. Annual meetings will be scheduled to discuss the operation of the pipeline along with other initiatives that may include an annual community investment fund, and annual contributions for community training and employment. The proposed funding for these types of initiatives on the Northern Gateway project was $400 million over 30 years. Other funds that the Indigenous ownership group could manage over the lifetime of the project may include a marine and coastal environmental protection plan, and a management training program that will ensure that one or more Indigenous community members obtain management level positions within TMX, including CEO. A similar community group could be established for private landowners along the TMX corridor. It is time for industry and government to recognize private landowners’ rights to protect and manage their own lands. 

Dale Swampy is president of the Calgary-based National Coalition of Chiefs and a member of the Samson Cree Nation. A University of Alberta economics graduate, he has worked in the oil and gas industry and with First Nations on economic development initiatives his entire career.

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BY C. KENNETH REEDER

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TMX and the Constitutional Mutiny

Once upon a time, it took just 20 months to get a pipeline built in Canada

D

avid Yager has been a founder, senior executive and director of various oilfield service companies. He continues to work with the industry through his consulting firm, Yager Management, and publishes a monthly column at Energy Now. He has also released his first book, Miracle to Menace: Alberta, A Carbon Story (miracletomenace.ca), about the clash over Alberta’s oil and gas industries, carbon taxes, climate change, and pipelines. Recently, Yager joined us to answer a few questions about the messy pipeline situation in Canada.

Q:

Going back about a year, what were your thoughts surrounding Ottawa’s purchase of the Trans Mountain pipeline?

Yager:

In recent years, pipeline approvals have started to take up to a decade. The original interprovincial pipeline from Edmonton to Superior, Wisconsin, was conceived in 1949. It took 20 months from conception to flowing oil, and that included the cooperation of

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“When on e provinc e tells a la province ndlocked that it ca n ’t have tid access, th ewater dysfunctio e country becomes nal. It’d b setting up e toll booth like Alberta s on the C mainline P Rail to inte from Asia rfere with car part s going to O ntario.”

seven governments: those of Alberta, Saskatchewan, Manitoba, Minnesota, Wisconsin, Canada and the United States. The original Trans Mountain pipeline was conceived [in 1951], built, and had oil flowing in 18 months. When the federal government approved [TMX] in 2016, that seemed encouraging. But then the new B.C. government came along a year later and said they were going to do anything possible to block the project. What you’re seeing is almost a mutiny—a constitutional mutiny by the provinces. It looked to me like the federal government realized that if they’re going to maintain credibility for the pipeline application approval process, having gone through all the hoops—and if Kinder Morgan was going to walk because of obstruction by British Columbia—I guess Ottawa’s

conclusion was that they had to buy [the pipeline]. Plus they have the advantage of using other people’s money. That’s the framework under which it was done. A federal-provincial jurisdiction battle was on Ottawa’s hands, and one way to deal with it was to own the pipeline.

Q:

Now that the Trans Mountain expansion has been approved by Ottawa, again, what are your thoughts about the current state of affairs?

Yager:

I’ve been asked this question many times over the years. When there are excavators digging ditch, when they’re lowering pipe in, welding it together, and buying it, then I will be comfortable saying the project is

going ahead. Look at the Northern Gateway pipeline, which was approved by the regulators and the federal government in 2014. The prime minister had pledged in 2015 that if elected he could cancel it, and he did so in 2016. So who knows what to believe anymore?

Q:

What do you think is the biggest way Ottawa has bungled this whole pipeline issue over the years?

Yager:

Politicians love regulators. When you’re running for public office and you say, “It’s for the common good that we bulldoze your house for this expressway or put these power lines over your land,” it’s not popular. So regulators are great because then you turn the decision over to people whose names aren’t on a ballot. In the past, [the regulators] were regarded as credible, and when they made a decision people would say they had their chance to say how awful they thought this project was and they got on with their lives. But now people are saying they don’t care what the process is. Increasingly when the outcome is not in their favour they go to court. Now the courts have to make these decisions. One of the issues is “duty to consult” [with Indigenous peoples]. The duty to consult is not defined. At the Federal Court of Appeal with

“Non-Indigeous people of Canada have never agreed about everything— it turns out the Indigenous people of Canada don’t, either.”

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Previous page: iStock / kwanchaichaiudom; iStock / red_fog; David Yager, supplied Facing page: iStock / stockcam; this page: iStock / slav

Trans Mountain and Northern Gateway, you put it in front of judges, and judges have to interpret what transpired in the consultation process. The idea with Bill C-69 was to create the perfect piece of legislation that allows greater input into the process. The argument is that a project that goes through the Bill C-69 process will get fewer lawsuits. But you’ll never have to deal with it because you’ll never get through the process or the process is so convoluted that no one will ever apply. Industry’s complaint was that they took a regulatory process that was already vague—and becoming increasingly vague for political reasons—and, without clearing up the vagueness, they’ve introduced more. We actually have to go the other way. You really need to look at the process and put in some simpler legislation, not like C-69, with a definition of duty to consult. People have asked for that, but that takes quite a bit of courage to craft the kind of legislation that would make those things easier to interpret. When one province tells a landlocked province that it can’t have tidewater access, the country becomes dysfunctional. It’d be like Alberta setting up toll booths on the CP Rail mainline to interfere with car parts from Asia going to Ontario. This is a serious issue that the current Liberal government seems to be downplaying. They appear to be completely deaf. World oil production is going up. World oil demand is going up. The only major oil-producing country in the world that is restricting tidewater access for

“Politicians love regulators because you turn the decision over to people whose names aren’t on a ballot.” surplus oil production is Canada. You could shut down the oilsands tomorrow and it wouldn’t mean anything on the scale of global emissions.

Q:

An interesting development we’ve seen is that more Indigenous groups are speaking out in favour of oil and gas development and pipeline construction. Do you think that’s having an effect on the dialogue, or is it falling on deaf ears?

Yager:

The opponents of development, the anti-carbon crowd, have said for years that these projects trample on Indigenous rights. Yet historically, there has been lots of positive Indigenous participation in oil and gas production in Western Canada. I know this firsthand. But [previously] when it came to the issue of Indigenous rights, everyone was treated as one group rather than individually. It seems that, for the first time,

you’re seeing a split in the viewpoints of Indigenous Canadians in ongoing oil and gas development. This is a positive breakthrough because pretty well all the anti-carbon NGOs wrap themselves in the cloak of protecting Indigenous rights. It’s harder to do that now. It’s harder to say you speak for Indigenous rights when some Indigenous people are taking Ottawa to court over Bill C-48, which shuts down the Spirit Eagle pipeline. The non-Indigenous people of Canada have never agreed about everything—it turns out the Indigenous people of Canada don’t, either. And industry is more than willing to work with them. It always has been. If you go back to the Federal Court of Appeals decisions on Northern Gateway and Trans Mountain, it was the consultation done by the federal government that was lacking, not industry. Overall I think it’s a very positive development in every respect. 

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BY DANNY LE ROY

The Knowledge Problem

Why government pipeline and energy corridor schemes are destined to fail

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ECONOMICS

L

ike many Canadians, I have been following the steady reporting on the proposed Trans Mountain pipeline expansion (TMX), Bills C-48 and C-69, the possibility of the federal government selling partial ownership to an Indigenous group, and Andrew Scheer’s proposed energy corridor. The creation of a functioning twin of an existing conduit two feet in diameter and 1,150 kilometres long seems as difficult as successfully assembling a jigsaw puzzle containing billions of pieces scattered over millions of square kilometres. The realization of new oil and gas transportation appears more challenging and even less likely. What are the chances that elected individuals can assemble countless puzzle pieces to produce useful and financially viable energy transport infrastructure? The answer: almost zero. Writing about the use of knowledge in society in 1945, Nobel Prize-winning economist F.A. Hayek explained why: “The peculiar character of the problem of a rational economic order is determined precisely by the fact that the knowledge of the circumstances of which we must make use never exists in concentrated or integrated

form but solely as the dispersed bits of incomplete and frequently contradictory knowledge which all the separate individuals possess. The economic problem of society is thus not merely a problem of how to allocate ‘given’ resources—if ‘given’ is taken to mean given to a single mind which deliberately solves the problem set by these ‘data.’ It is rather a problem of how to secure the best use of resources known to any of the members of society, for ends whose relative importance only these individuals know. Or, to put it briefly, it is a problem of the utilization of knowledge which is not given to anyone in its totality.” The implication of Hayek’s insight is that, for government to completely and efficaciously coordinate a pipeline into existence, it would involve complete knowledge by each official of everyone else’s plans. But no one has or can possess this necessary amount of knowledge. Imperfect coordination is the inevitable result of the fact that individuals differ. And it is the reason why central planning gives rise to high cost, low output, low quality and, in the present instance, interpersonal conflicts and stalled pipeline construction. Fortunately, there is a ready way to overcome what appears to be an insurmountable coordination problem: the price system.

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ECONOMICS

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“What are the chances that elected individuals can assemble these puzzle pieces to produce useful and financially viable energy transport infrastructure? The answer: almost zero.” This outcome is intended by no one. It is spontaneous. It is the result of human action, not of human design. The spontaneous coordination of the economic decisions of millions of people occurs to the extent that prices—which guide people’s decisions—accurately reflect underlying economic realities such as resource scarcities and individual preferences. No one is forced to do business with those they would prefer to avoid. And being free to peacefully take advantage of any existing opportunities, each person selects those that improve their individual circumstances by the largest extent. The price system does not resolve all the problems of building, owning and operating a pipeline. But it does encourage millions of people to interact in a respectful and mutually beneficial way. No person, council, committee or parliament can effectively choreograph this outcome. But they can stifle it and even prevent it from coming about. Impediments to interpersonal

trade hobble the ability of market processes to coordinate people’s mutually beneficial productive efforts. Interventionism falsifies relative prices and compromises the integrity of information embodied in them. This misleads individuals into making an unusually large number of plans destined to fail, which is a pretty accurate summary of what has happened with a few recent high-profile pipeline projects in Canada. And it may foreshadow what is to come. 

Danny Le Roy, PhD., is an economics professor at the University of Lethbridge, where he is also coordinator of the Agricultural Studies program. Areas of research include commodity production, marketing and trade, government interventionism and Austrian economics. He blogs occasionally at mises.ca.

This page and previous page, iStock / Osvaldo Maldonado

Where knowledge of relevant facts is widely dispersed, as is the case with building, owning and operating a pipeline, prices serve to coordinate the separate actions of countless numbers of different people each pursuing their separate self-interests. A significant advantage of prices over planning is the economy of knowledge with which the price system operates. Individuals need to know very little about everything going on in the world around them to discern their best course of action. Based on the information contained in a price, individuals modify their choices and adjust their behaviour. The price system is a kind of machinery for aggregating and registering these changes. Hayek compared it to a telecommunications system enabling individuals to make decisions by watching the movement of only a few pointers. Observing prices, each owner of private property (such as land, labour and other assets) has incentive to use that property in ways that produce the greatest return and personal benefit. Likewise, each potential buyer seeks to get as much satisfaction as they possibly can from spending their income. Potential buyers avoid inefficient or costly suppliers and patronize ones more to their liking. Preferred sellers are motivated to increase their supply; others adapt or switch to producing other things. Output and consumption opportunities increase and a complex pattern of productive use of resources emerges, which includes pipelines and all other goods and services.


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PIPELINE CONSTRUCTION 101

Everything landowners need to know about the life of a pipeline. REMEDIATION 101

What they are, what’s involved and what landowners should know. BIOSECURITY

Everything landowners need to know about protecting and restoring soil after pipeline construction. PROTECTING PROPERTY RIGHTS

How developing and enforcing a biosecurity protocol protects your land.

Know your rights—and how to stand up for them.

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This is how we protect the land, water and wildlife. Thousands of dedicated professionals across the country – from engineers to environmental experts – work together to deliver the energy you need while protecting the environment. Find out more at aboutpipelines.com 44

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