PIPELINE OBSERVER SPRING 2020 by CAEPLA

PIPELINE

SPRING 2020

CANADIAN ASSOCIATION OF ENERGY AND PIPELINE LANDOWNER ASSOCIATIONS

CONTINENTAL ASSOCIATION OF ENERGY AND PIPELINE LANDOWNER ASSOCIATIONS

OBSERVER

DID STONE AGE FARMERS INVENT PROPERTY RIGHTS? VIOLATING PROPERTY RIGHTS Government legislation licenses bad corporate behaviour

SPIRALLING COSTS

The implications of Trans Mountainâ&#x20AC;&#x2122;s increasing price tag

LITTLE PINK HOUSE

This Hollywood film will resonate with Canadian landowners

The CAEPLA Workshop Series Designed as a service to landowners.

CAEPLA WORKSHOP SERIES

OPPORTUNITIES FOR CONTINUED LEARNING COVER TOPICS SUCH AS: HOW TO CROSS THE LINE - SAFELY

Take the guesswork out of moving your equipment over pipeline rights of way. INTEGRITY DIGS

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.

“THE TOPICS AND THE OPPORTUNITY TO INTERACT ARE VERY MUCH APPRECIATED. IT IS ALWAYS INTERESTING TO LEARN ABOUT THE INDUSTRY.”

“VERY INFORMATIVE AND INTERESTING. CONTINUE WITH THE WORKSHOPS TO BUILD A CLOSER RELATIONSHIP WITH COMPANIES.”

Stay tuned for our next series. Check our website often for new dates, topics and locations.

For more information contact: admin@caepla.org or 306-522-5000

DON’T MISS THIS OPPORTUNITY TO LEARN MORE Brought to you by Enbridge and CAEPLA, Canada’s leading advocate for landowner safety and environmental stewardship.

CONTENTS

SPRING 2020

CANADIAN ASSOCIATION OF ENERGY AND PIPELINE LANDOWNER ASSOCIATIONS

“We are truly grateful and humbled by the tremendous support we’ve received across Alberta, Saskatchewan and Manitoba for [Line 3] over these past six years.” –Leo Golden, Enbridge

04 07 10

40 Cover: John Zada / Alamy Stock Photo

New Friends, New Pipe and New Challenges Good news is on the horizon

Don’t Want TMX Built?

Be careful what you wish for

Line 3 Reborn

Enbridge’s largest-ever capital expenditure in Western Canada is complete

Little Pink House

A new film tells a powerful tale about land expropriations

Were Farmers the First Property Rights Revolutionaries?

20 22 26 30 32 34 37 40

Is Ottawa At War With Its Own Citizens?

New research says yes

Economic sanctions hurt consumers and producers

Pipeline Safety, One Step at a Time

Protecting the public through regular inspections

Recipe for Restoration

Reviving soil through alternative farming

Want Trans Mountain Expanded at Any Price? Taxpayers will be on the hook for expanding costs

Construction Monitors

What every TMX landowner needs to know

When Pollution is a Violation of Property Rights Changes are needed when it comes to law-making

Digging Safely in Saskatchewan Reducing damages with the SCGA

Indigenous Anti-Poverty Efforts New UN legislation is a threat

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 ©2020 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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BY ANNETTE SCHINBORN

New Friends, New Pipe and New Challenges Despite doom and gloom around energy transport in Canada, there is good news on the horizon for pipeline landowners.

hat does a landowner property rights organization have in common with a coalition of Indigenous chiefs? Being pro development, pro prosperity and committed to getting pipelines built

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safely and sustainably, for starters. This past November, I attended the National Coalition of Chiefs (NCC) conference in Calgary. A pro energy Indigenous group, NCC is committed to getting pipelines built. While safety and environment are priorities, ending on-reserve poverty is its primary goal.

Respecting landowners, both Indigenous and non-Indigenous An alliance between the NCC and CAEPLA (Canadian Association of Energy and Pipeline Landowner Associations) was first revealed in the Summer 2019 issue of the Pipeline Observer. This alliance was publicly

“While safety and environment are priorities, ending on-reserve poverty is the NCC’s primary goal.”

respects landowners, both Indigenous and non-Indigenous. Which is why we reached out to Dale Swampy when we first heard of the work he is doing with the NCC.

iStock / malerapaso

Building bridges and building pipelines right

announced by Dale Swampy, CEO of the NCC, and myself at that successful Calgary conference. CAEPLA believes protection of property rights can not only get pipelines built, but also promote prosperity of all Canadians while building right, building safely and building in an environmentally friendly way that

The NCC is a breath of fresh air. Too often, the only story we hear about Indigenous Canadians and pipelines centers on First Nations activists opposed to energy and energy transport. But the NCC wants everyone to know another First Nations story — a story of hope and prosperity that will help their people escape poverty. CAEPLA is committed to working with the NCC to build bridges between all landowners, rural and Indigenous, and protect their property rights. One major pipeline that got built this past year in Canada is Enbridge’s Line 3 Replacement (L3RP). On December 1, oil flowed in the new replacement pipe from Hardisty, Alberta, to Gretna, Manitoba. It’s the only major pipeline project built in Canada in the past 10 years and CAEPLA played a big role in getting it done — and done right. CAEPLA negotiated for standards that raised the bar on safety and environment that exceeded those of the regulator, while also featuring a precedent-setting biosecurity protocol and CAEPLA-approved independent construction monitors, beneficial to both landowners and Enbridge. It was a win for everyone. Not only for landowners and Enbridge, but also for Energy Corridor Canadians and the economy.

This is a big deal in an era when energy transport has been paralyzed by anti-pipeline activists, and when a regulatory framework under the new Impact Assessment Act (IAA) and Canadian Energy Regulator Act (CER) threatens property rights like never before.

In with the new, out with the old The new Line 3 is now in service in Canada, but there is still work to be completed on the Right of Way. As farmers and ranchers know too well, the weather last fall wasn’t your friend. Which is why, for Enbridge, some remediation work on the final spreads of the Line 3 Replacement got delayed, but will resume this spring. The next phase of this project is the decommissioning of the old Line 3. As directly affected landowners live and work with this pipe in their backyards 24/7/365, they have serious skin in the game. Nobody has a greater interest in seeing the old pipe dealt with right. CAEPLA-approved, independent construction monitors will again be on site. Just as they did during construction of L3RP, these monitors will help the company pre-empt problems and provide pipeline landowners and the public reliable peace of mind. Even though it is the responsibility of each landowner to know what is happening on their property, the CAEPLA construction monitors, provided by the skilled team of Infocus Management Consulting, are the boots on the ground helping ensure work is carried out as promised in the Easement Agreement.

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Knowledge is power For several years now, CAEPLA has been engaged with Enbridge overseeing University of Calgary research on corrosion and the structural integrity of decommissioned pipe. The U of C was awarded an additional Natural Sciences and Engineering Research Council of Canada (NSERC) grant to continue with its research for a couple more years. Much has been learned by both CAEPLA and the landowner committee, as well as by Enbridge, on what might happen to pipe that is decommissioned and left in the ground. As we’ve participated in meetings and consulted experts, what we have learned is “we don’t know what we don’t know.” I know that sounds weird. But it is an important thing to acknowledge. The experts assure us we are asking the right questions and are on the right track. But this is an issue of enormous importance to landowners, and knowledge is power. So we need to be patient and learn everything we possibly can to ensure decommissioning is done right. These things take time, so stay tuned. When it comes to figuring out what actually happens to decommissioned pipe, CAEPLA is at the cutting edge. We recruit independent experts, because we are seeking to understand what the risks really are to landowners living and farming over these pipes. And as it turns out, we've been told that no research has been done on abandoned-in-place pipelines anywhere in North America, ever.

Want to be an expert on decommissioning? As technology continues to advance, we are optimistic that cost-efficient and environmentally friendly possibilities

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“L3RP was the only major pipeline project built in Canada in the past 10 years and CAEPLA played a big role in getting it done – and done right.” will emerge, and we will pursue them for you. Because CAEPLA is all about solutions, and this is a great opportunity to cooperate with industry to find some for pipeline landowners. Another area where CAEPLA will continue with its pro-active approach is with our Workshop Series. Available to landowners, this series is an opportunity like no other. In a laid-back atmosphere, landowners learn about the energy industry, how pipeline systems work, the types of product that

flows through the pipes, biosecurity protocols and so much more. I will venture to say landowners who have attended these events now have a greater understanding of the pipeline industry than 95 per cent of the public does. So if old pipe and what happens to it is top-of-mind for you as a pipeline landowner — and it should be — then you will be as excited as I am to see the subject showcased in the Workshop Series very soon. Because decommissioning will be the most important issue for pipeline landowners in every corridor, from Trans Mountain to the southern Ontario heartland. Given the precedent CAEPLA helped set for L3RP when it comes to respect for landowners and their property, for safety, environmental stewardship and professionalism, we are confident the decommissioning discussion will go the same way. Do you have a question or a situation happening on your property? Are you a TMX landowner and have concerns about how you are being affected? Give CAEPLA a call at 306.522.5000 or email us at admin@caepla.org or through our website caepla.org. 

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.

B Y D AV E C O R E

Don’t Want TMX Built?

Facing page: iStock / timsa; this page: iStock / tomasworks

Be careful what you wish for…

any directly affected landowners on the Trans Mountain Expansion (TMX) are ambivalent about

the project. Some will sign the first document

put in front of them if it includes a cheque, without considering the consequences. Sometimes they’ll sign even without the cheque. Others will ask a few questions, because deep in their gut they know this will have impacts on them. But they are intimidated by — and have no idea how to deal with —

the slick land agent representing a multibillion-dollar corporation that once had government backing and expropriation powers and now is the government, with even more power. Some landowners with more assertive personalities will succeed at getting a little extra compensation. They will be satisfied they outsmarted

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“Without a new pipeline, with new technology, what will you be left with?”

the agent and even their neighbours, much like the fellow I will introduce you to later in this article — before he found CAEPLA. Last but not least are those who will be determined to get changes to the easement agreement, fair compensation and will not sign on principal. But they will still get expropriated. The thing all of these folks have in common is that they are all in the same boat — a boat designed to sink them and get their property on the cheap. The intent being to cut them adrift on their own property without their right to a freely negotiated contract that would protect their family, their investment and their business.

Would it really be better if TMX is never built? The “boat” I refer to, of course, is Canada’s energy regulatory regime. I am sure that after reading these cynical, but true, statements you may say, “Well then maybe it’s better if it doesn’t get built.” But would it be better? Will it be better if the project doesn’t get built, if it continues to be sandbagged by activists, treated like a political hot potato and parked permanently by government? Imagine what a future without the expansion will look like. Without a new pipeline, with new technology, what will you be left with? Trans Mountain was built in the early 1950s — it’s almost 70 years old. Trust me, it is corroding. There is a very good chance there is, or soon will be, contamination on your land or your neighbours’. And the Right of Way (RoW) on

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your land may be just as old as the pipe, but recent legislative changes under the Canadian Energy Regulator and Environmental Assessment acts have opened your property up to a whole slew of new problems.

Get the protection of a CAEPLA contract Among these new problems are politically approved trespassers with the power to suspend operations on your property with a claim they found so much as an arrowhead or bone fragment in your soil. Soil that will be dug up if the TMX proceeds. Without a quality contract of the kind we at the Canadian Association of Energy and Pipeline Landowner Associations (CAEPLA) have been creating for nearly a quarter century, you will have no legal say over what happens with the old pipe. No say over how or when government workers — TMX remember, is owned by the Canada Development Investment Corporation, a federal Crown — access the RoW across your property. No say over what those government workers do on the easement on your property, no say over who can buy that RoW, and who, again, can tag along with those government workers. Yes, the federal government and its friends are now squatting in your backyard. More than one TMX landowner has contacted CAEPLA to say “there goes the neighbourhood.” And they are right. If you thought you had problems with Kinder Morgan or any previous private owner of the pipe, you ain’t

seen nothing until you’ve been afflicted with an energy project owned by a Crown corporation. Just ask the long-suffering members of Manitoba’s BiPole lll Landowners Committee (MBLC), still fighting the good fight alongside CAEPLA in that province. Beware, too: at one time only authorized personnel who had no interest in the rest of your private property could come on that easement. That is no longer the case. And those government-mandated, trespassing political activists will be able to restrict your farm, dwelling or business. And even sterilize your property as an archeological or heritage site as government panders to anti-pipeline special interests. It’s already happening in B.C. with values of residential properties being destroyed by heritage-type activists. There are also many historical contaminated sites along this pipeline that have never been cleaned up. Contamination on your private properties that the incompetent federal regulator has left in limbo for decades as its jurisdiction trumped provincial and landowner initiatives to hold companies to account. I am sure Kinder Morgan was quite happy to unload this controversial project, the corroding old pipe and those polluted sites to unsuspecting Crown Corp bureaucrats and politicians as approval timeliness and costs spiraled. We all know what happens to metal over the years. Cars and machinery eventually corrode and rust out. Pipes in our houses eventually wear from use and spring leaks. Pipelines are no different. And leaky pipes have the potential to

iStock / fotosuper

“Things could get pretty chaotic without the protection of a CAEPLA contract covering integrity digs.” transform your farm into the equivalent of an abandoned urban gas station. True, there are very advanced electronic technologies (PIGS) that can be put down pipe to identify weak spots, dents, corrosion and leaks, but men, backhoes and other equipment must be brought in to dig up your crops or your backyard to check or repair these vulnerabilities. And as with your car, when it gets older there will be more and more repairs and more and more damage to your property and your cheque book. Damage to driveways, fences, shelterbelts, crops, topsoil, pastures, lawns. Disruption of your business, your home life, your peace of mind and enjoyment of your property. All will be

casualties of a deteriorating pipeline mismanaged by Ottawa. Things could get pretty chaotic without the protection of a CAEPLA contract covering integrity digs. Under new laws I mentioned above, the Minister of the Environment can make agreements with “Indigenous governing bodies,” giving such bodies authority over private property. Perhaps Allan, who I also mentioned earlier, can serve as a case study. I met Allan about six years ago. We’ve become friends and he is a great supporter of CAEPLA. He lives on land he bought to build a house on and to use as recreational property. It is covered with trees, trails and wildlife, and is great for hunting.

It also happened to have a few pipelines on it. His first encounter with pipeline workers is another story in itself, which he himself can tell another time. He’s a smart guy — some would consider him a SOB. He talks and plays tough, always has. He didn’t much like the way companies treated him when he first bought the property. He searched the internet for help and found CAEPLA. He says that talking to and meeting the folks at CAEPLA has been one of the best things that happened to him. I did my best to help him understand the ins and outs of pipelines, landowners and the NEB. I told him he needed to look at the property as a pipe farm. And as such he needed to treat it as a business, not an inconvenience. With CAEPLA’s help his property is now a profit centre, his land is producing. His theory now is that these companies are making billions of dollars for their shareholders and as such he should be treated with respect and sharing in those profits — like any other business partner. He realizes that without CAEPLA he and other pipeline landowners would still be only getting damage, frustration and next to nothing for compensation for the pipelines on their property. If you are a TMX landowner, you know where to find us. 

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 I D C O L L

Line 3 Reborn Successfully completed replacement project is Enbridgeâ&#x20AC;&#x2122;s largest-ever capital expenditure in Western Canada.

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Enbridge pipeline maintenance crew at the Gretna Terminal standing by the final tie-in point of the Line 3 replacement pipeline in Canada. The large flange in the centre of the photo is the connecting point between the new Canadian pipeline and U.S. Line 3, which runs to Superior, Wisconsin.

Photo courtesy Enbridge

t takes a community to build a pipeline. Landowners, municipalities, Indigenous communities, regulators, elected officials, construction contractors, unions and chambers of commerce, goods and services providers, customers seeking to ship their products to market safely and reliably — it’s taken the support of all of these groups to get the Enbridge Line 3 replacement pipeline (L3RP) built in Canada. So says Leo Golden, Vice President, Line 3 Project Execution, as the new, 36-inch-diameter, Canadian-made pipeline was put into service for the first time in December 2019. “We are truly grateful and humbled by the tremendous support we’ve received across Alberta, Saskatchewan and Manitoba for this project over these past six years,” says Golden. “Without that support and collaborative mindset, we wouldn’t be where we are today.” The new pipeline will run at approximately half of its rated capacity, some 400,000 barrels per day, until such time as the Minnesota portion receives final approval, and is constructed and brought onstream. “First and foremost, the Line 3 project was about enhancing the safety and integrity of infrastructure

that is critical to the functioning of our society, much like a highway, a bridge, or an airport,” Golden says. “Today, Line 3 is one of more than 80 oil and gas pipelines and 30 major electric transmission lines that cross the Canada-U.S. border, operating as part of a single, integrated North American energy market. Access to this continental energy market is critical for consumers, industry, and governments.” The new pipeline stretches approximately 1,070 kilometres (665 miles) from Hardisty, Alberta, to Gretna, Manitoba. At an estimated cost of $5.3 billion, it represents the largest capital expenditure — and the largest and most successful stakeholder engagement undertaking — in Enbridge’s 70-year history in Western Canada.

CAEPLA cooperation a key component First announced in July 2013, Enbridge has since recorded more than 30,000 engagement activities with interested parties, including thousands of in-person meetings, presentations, coffee talks, group workshops, open houses and trade shows. In addition, project land agents have thus far conducted more than 31,000 landowner outreaches, garnering the support of all 1,087 right-of-way landowners along with 4,000 outreaches to 41 rural municipalities. “Enbridge’s partnership with the Canadian Association of Energy Pipeline Landowner Associations (CAEPLA) was an important component in successfully engaging

“At an estimated $5.3 billion, Line 3 Replacement represents the largest capital expenditure in Enbridge’s 70-year history in western Canada.”

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“Enbridge’s partnership with CAEPLA was an important component in successfully engaging landowners.” –Dave Lawson, VP, Major Projects landowners,” says Dave Lawson, Vice President, Major Projects. “The joint committee we established ensured landowners were well informed throughout the project — not only about our construction plans and mitigation measures but also about our post-construction follow-up processes and general Enbridge practices.” In addition, the CAEPLA/Enbridge workshops provided a forum for landowners to learn about various practices at Enbridge, such as preventative maintenance digs, and discuss any questions they have about ongoing projects in their area with Enbridge experts. Another defining characteristic of the L3RP was the focus on project community investment, which saw donations totaling some $3 million to support more than 400 community-driven projects including celebrations/cultural events,

building improvements, parks and playgrounds, environment and safety initiatives, emergency response equipment upgrades, and investments related to education, special projects and social issues. These project funds are part of Enbridge’s ongoing community investment program, which in 2018 distributed more than $22.5 million to more than 3,450 organizations across North America.

Restoring soil to a better condition than before construction Meanwhile, as the new pipeline begins to ship oil for its customers, final reclamation of the remaining 100 km of the construction area, in southeast Saskatchewan, won’t take place until sometime in the spring of 2020 due to inclement weather. “Our objective, as always, is to

restore the land to as good or better condition as prior to construction,” says Al Sawatzky, Line 3 Construction Manager. Reflecting on the L3RP coming into service, Sawatzky says, “This is the only major pipeline construction in Canada in the last 10 years. Other major pipelines are planned, but none have started and we’ve been talking about them for several years now. So to build a major pipeline from Hardisty to the U.S. border is a pretty big deal — for Enbridge, for the industry, and for Canada.” That just doesn’t happen, he adds, without the support of landowners, municipalities and Indigenous communities right across the Prairies. “The railroads opened up this country. They were built to get things moving,” he concludes. “A pipeline is very similar — we have to get our product to market, and pipelines are the safest way to do it.” 

Economic Benefits of the Line 3 Replacement Program Enbridge’s presence in the community fuels quality of life through ongoing tax revenue. This revenue can be used for schools, infrastructure (roads and bridges), health and wellness, recreation, transportation and other services that help strengthen the fabric of the community.

ECONOMIC MODELLING SUGGESTS THAT ENBRIDGE’S LINE 3 REPLACEMENT PROGRAM WILL:

U Generate $216.5 million for the province of Alberta in tax revenue during the project’s construction phase.

U Generate $183.9 million for the province of Saskatchewan in tax revenue during the project’s construction phase.

IN ALBERTA… U Contribute $1.389 billion to the Gross Domestic Product (GDP) of Alberta through the project’s design and construction phases.

IN SASKATCHEWAN… U Contribute $1.065 billion to the Gross Domestic Product (GDP) of Saskatchewan through the project’s design and construction phases.

IN MANITOBA… U Contribute $391.9 million to the Gross Domestic Product (GDP) of Manitoba through the project’s design and construction phases.

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U Generate $108.2 million for the province in tax revenue during the project’s construction phase. NATIONALLY… U Contribute $2.873 billion to the GDP of Canada, through the project’s design and construction phases. U Generate $514.3 million for Canada in tax revenue during the project’s construction phase. These figures include federal and provincial goods and service taxes, federal income taxes, and excise taxes.

BY CK REEDER

Actress Catherine Keener (left) plays propery rights activist Susette Kelo in Little Pink House.

Little Pink House Photo courtesy Korchula Productions

This drama about regular people fighting against political and corporate interests that want to take their property will be all too familiar to landowners.

lot of Western films involve expropriation and property rights, often culminating in gunfights against crooked sheriffs and land surveyors. A quiet drama about these issues might be a tough sell. But Little Pink House is a strong, simple film about the underappreciated issue of expropriation (or “eminent domain” as they call it in the United States). It’s not a legal thriller with slick lawyers facing off. It’s a

biographical drama about regular people fighting against political and corporate interests that want to take their property. This film dramatizes the story behind the significant Kelo v. City of New London case heard by the U.S. Supreme Court in 2005. The decision in this case permitted a Connecticut city (New London) to condemn private property so that it could be transferred to another private party for “economic redevelopment.”

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“The movie is effective in subtly capturing the importance of property rights without making its case explicit in those terms.” plant. He yearns for a headline that says, “Republican governor revitalizes blue collar Democrat town.” His motivations are entirely political and he is portrayed as callous and unsympathetic.

He recruits a well-connected local college president, Charlotte Wells (played by Jeanne Tripplehorn), to head the New London Development Corporation (NLED), to “independently” push for a project with pharmaceutical giant Pfizer (famous for Viagra). Pfizer is only interested in locating a facility there if it gets free land and if the government will clean up the ugly old neighbourhoods nearby. This requires major redevelopment and means the state needs to use eminent domain powers to expropriate property from the current residents. NLED informs residents that their homes have been “designated for the redevelopment,” and they are being offered “fair market value” for their homes. Many residents are happy to sell, but seven — including Kelo — hold out. They refuse to sell despite being offered “significantly more” than the value of the property. The NLED agents are baffled that

“Philosophers have discussed the importance of property to the human condition: Using our labour to transform land and resources puts a part of us into those things.”

Photo courtesy Korchula Productions

If this sounds familiar, it’s basically the same issue many landowners deal with when pipeline and utility companies roll in wanting to use their property for “the public interest.” Susette Kelo (sympathetically played by Catherine Keener) has bought an old house in New London that she renovates and restores (along with hard work itself, she gets sprayed by a skunk along the way). She paints the house pink (or “Odessa rose,” she tells a friend) which gives the film its namesake. The nearby sewage treatment plan stinks up the neighborhood a bit, but Kelo’s nice view of the river is a worthy trade-off. Early scenes paint a clear picture of life in a small, economically depressed town. Kelo works as an EMT and she seems personally acquainted with everyone. One resident jokes that she’s got the only job with any future prospects because most of the townsfolk are so old. The town feels tired as you follow Kelo around during the introductory scenes. There isn’t much going on. There are shots of rundown buildings in the city centre. A scene in a deli where Kelo is the only customer (the deli owner later confesses he can barely cover his payroll). A radio host in the background talks about the region’s bad economy and recessionary conditions. Kelo has a relationship with Tim, the local antiques dealer. He tells her he loves her, but she just wants to be friends. She tells him she wants things to “stay as they are,” which parallels her upcoming fight against the forces of “progress.” Meanwhile, Connecticut’s Republican governor is running for re-election. He is rather popular even with Democratic voters. He wants votes in New London and his plan is to bring jobs by redeveloping the land around the old sewage treatment

“Kelo’s side argues that eminent domain should never be used for private use, only ‘public benefit.’ This is the chink in their armour.” someone might value their property beyond what is reflected in its “market value.” But as one man points out earlier in the movie, where else can a guy work 40 years as a bus driver then comfortably retire somewhere with such a great view? The film is effective here in subtly capturing the importance of property rights without making its case explicit in those terms. Owning something isn’t equivalent to receiving a payment equal to its supposed “fair market value.” Money can’t replace homes and memories and the unique connections we feel to places that are special to us. Many philosophers, from Locke to Hegel, have discussed the importance of property to the human condition. Using our labour to transform land and resources puts a part of us into those things. It makes those external things extensions of ourselves. Little Pink House also shows political awareness during a scene where the head of NLED tries some “community engagement” to counter the Kelo anti-expropriation campaign. The filmmakers recognize that this is part of the democratization and manipulation process. When a decision has been made, hold some phony town hall discussions to give people the illusion that their opinions are important (spoiler alert: their opinions are not important). When her pleas for “reasonableness” are rebuffed by the straightforward arguments of angry townsfolk, the land grabbers’ spokeswoman resorts to pedantic sloganeering that would make Justin Trudeau himself cringe. A legal advocacy group takes Kelo’s case all the way to the U.S. Supreme Court where they meet their

final defeat. Kelo’s side argues that eminent domain should never be used for private use, only “public benefit.” This is the chink in their armor easily exploited by the city lawyers. They argue that private use represents a public benefit if it would generate more tax revenue, shamelessly admitting that poorer people don’t produce much tax revenue and so it is reasonable to expropriate their property. The Supreme Court basically accepts this argument. With that defeat, Kelo and the other hold-outs lose their homes. But perhaps the ultimate insult is disclosed at the end of the film. Despite the merciless eviction of several families from their property, the planned redevelopment never actually happens. To this day, the land remains an undeveloped lot where a little pink house once stood. The Pfizer facility closes down when its tax breaks expire 10 years later. Overall, this is a strong film that effectively examines issues dear to readers of Pipeline Observer. The key lesson is this: “Fair market value” is meaningless in the absence of voluntary exchange. An “offer you can’t refuse” can never be a fair deal. Little Pink House is available on Netflix and Amazon Prime. 

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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BY NADIA MOHARIB

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Were Farmers the First Property Rights Revolutionaries?

New research reveals a surprising relationship between farmers and the invention of property rights.

iStock / Grafissimo

ver since farming emerged almost 12,000 years ago in what is today Iraq, people have been fascinated by how it came about, and survived in a world where hunting and gathering still provided more calories and healthier populations. Many scholars have long believed that to ensure farming’s long-term survival, property rights were conceived out of necessity. It is one of the world’s oldest “chicken and egg” riddles that now appears to have been solved. A new report, by economists Samuel Bowles and Jung-Kyoo Choi at the Santa Fe Institute, finds that farming, by itself, could not have driven property rights. But quite the opposite is true. It turns out farming was unlikely ever to have evolved without property rights — and won’t survive in the future without them.

“People think of a ‘right’ as something enforced by a government. But private property rights definitely predated governments.” — Samuel Bowles

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“CAEPLA has long argued that the threat to property rights by government is a direct threat to your farm and family.”

The Canadian Association of Energy and Pipeline Landowner Associations (CAEPLA) has long argued that the threat posed to property rights by governments and their regulators is by extension a direct threat to your farm and family. CAEPLA talked to scholar Samuel Bowles about what he has unearthed and learned about this vital relationship.

What sparked your interest in the connection between farming and property rights? Why does the relationship between the two matter?

BOWLES: One of the big challenges today is to figure out what institutions can allow us to best organize our system of production and distribution in light of the rapidly changing technologies of the knowledge-based economy. Learning about a similarly huge change in technology — the origin of farming over 11 thousand years ago — and how that interacted with the spread of a new set of institutions— private property — may give us some clues about improving how our economy works today.

Did property rights arise everywhere farming did and vice versa? Did farming follow property rights around the world, or was it the other way around?

BOWLES: The evidence that we have discovered points to rare pockets of pre-existing private property among hunters and gatherers kicking off this chicken and egg process. But once it got rolling, it was a two-way street. The increasing scope and security of private property provided an institutional environment in which farming could flourish. And the expanding farming economy broadened the range of application of private property rights.

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Most people agree one of the core responsibilities of government is to protect property—but is it not the case that property rights predate the State?

BOWLES: Great question. Spiders have property rights in their webs. I don’t think they have governments. People think of a “right” as something enforced by a government. But private property rights definitely predated governments. They were maintained by mutual consent and by cooperation among people in punishing anyone who violated them, akin to some social norms today, like “finders, keepers.” Among humans, and in modern societies, governments have a comparative advantage in enforcing most rights. But rights can exist without governments.

Can farming survive without property rights today? Is it safe to say that the agricultural failures of Communist countries were, and are, due largely to the lack of property rights?

BOWLES: Farming today and during the Neolithic age alike is best served by a system of private property rights. But today these

cannot include the right to use methods that degrade the environment and impose costs on other farmers or on the biosphere. I am thinking of Monsanto’s weed killer Round-up, and the damage it did.

Were there any farming societies that did not have some form of property rights or hunting-gathering societies that had property rights but never entered into farming?

BOWLES: Absolutely. Australia, California, the Western Cape of South Africa, contain prime farmland (that is now extensively farmed) but did not adopt farming until the Europeans arrived bringing our property rights institutions with them. A good case can be made that the Australians never farmed. This was not, as some think, because they lacked species that could be domesticated (they had many and exploited them in the wild); or because they never “invented” farming—they were connected by a land bridge to New Guinea, and regularly interacted with farmers there; but because they did not have suitable property rights. In the paper, I quote Captain Cook remarking on how odd it is that the Australians did not farm. 

Samuel Bowles, (PhD, Economics, Harvard University) is research professor at the Santa Fe Institute where he heads the Behavioral Sciences Program. He taught economics at Harvard from 1965 to 1973 and since then at the University of Massachusetts, where he is now emeritus professor and at the University of Siena from 2002 to 2010 where he continues to occasionally teach. The Santa Fe Institute is an independent, non-profit research and education center that leads global research in complexity science. Dr. Bowles’ research on farming and private property in pre-history is available free online at journals.uchicago.edu/doi/full/10.1086/701789 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 CK REEDER

Is Ottawa at War With Its Own Citizens?

conomic sanctions are acts of war — and Ottawa has imposed de facto sanctions on its own people. If this seems to be a major misuse of language, that’s because our political dialogue has already introduced distortions to our thinking on these concepts. Politics is always characterized by the corruption of language. But

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it never stops with language. The corruption spreads to our thinking, because we mainly think through speech. So let’s try to clear the fog of this “war.” We are familiar with the issue of sanctions. The word embargo has all kinds of more militaristic connotations, while sanction sounds nicer. But these are basically the same things. When a government restricts trade, it is coercively preventing voluntary exchange that would

otherwise occur. Sanctions hurt both the producer and the consumer. The producer cannot sell to everyone he wants and the consumer cannot buy from everyone he wants. Sanctions are a regular weapon for international relations. Perhaps most notably in the last few years, Russia has been prevalent in the headlines, subject to a sustained USled campaign of economic sanctions that began in 2014. The most recent development is new US legislation to

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Laws attacking energy are an attack on property rights and are more destructive than bombs.

“Economic sanctions are blockades in all respects short of having troops on the ground or ships in the water.” sanction Russia’s NS2 natural gas pipeline to Germany. Sanctions were used to devastating effect on Iraq between the Gulf War and Bush II’s invasion in 2003. Hundreds of thousands of children died from lack of medication and proper nutrition. Perhaps the most significant use of sanctions in the last century were oil, rubber, and steel embargoes on imperial Japan. This led to the attack on Pearl Harbor and America’s formal entry into World War II. We understand the power of sanctions and why stronger nations use them against weaker nations. But we don’t often ask whether a nation can put sanctions on its own people. What else can we call Bill C-48, the coastal tanker restriction, but a form of embargo or sanction, as it specifically restricts export market access in a way that is clearly punitive to certain energy producing regions of the country? What else is Bill C-69 but an attempt to discourage major projects that are critical to the growth of a key regional industry — again, using legislative fiat to impose a roundabout form of blockade? Many industry analysts have called this the “No More Pipelines Bill” because it creates insurmountable regulatory hurdles to overcome. As such, it is a pillar of Ottawa’s embargo policy. How else can one interpret these actions when the prime minister

openly declares that a certain region’s main industry must be “phased out?” Embargoes have long been a staple tactic in warfare. Economic sanctions are blockades in all respects short of having troops on the ground or ships in the water. Sanctions entail a threat backed by force of law against anyone in violation. If judged by its consequences, the continuing sanctions against the economies of energy producing provinces in Canada are practically indistinguishable from how, say, the US treats Russia. Or Iran. Economic sanctions are cruel and indiscriminate. We’re not talking about the quick execution of a sniper’s one-hit-kill or a hypersonic missile that destroys a target, but rather a deliberately slow, sadistic strangulation of an economy. Is that really any less hostile? In fact, Ottawa would’ve done less damage to the country if they’d just bombed Alberta and Saskatchewan instead. Its economic interference has been far more harmful. Exploded buildings can be rebuilt easily. The fundamental ability to be productive is much harder to restore once extinguished by a continuous assault. Sustained attacks by Ottawa on private property rights of landowners and energy producers don’t just undermine the ability to create present wealth but also future wealth. With conventional warfare, the state uses weapons to kill its enemies. With sanctions, it strives to psycho-

logically and spiritually degrade and demoralize the targeted people. To illustrate this, you need merely look at some of the statistics out of Alberta over the last four years. Economic struggles are more than just numbers in spreadsheets. “Capital flight” is more than an academic idea in a textbook. These things mean business closures. Bankruptcies. Family turmoil. Suicide (50 per cent higher in Alberta than Ontario). Escalating drug abuse. At the time of this writing, young Albertan men have a 20 per cent unemployment rate, more than triple the national rate. To add insult to injury, the political class of the sanctioned population — enriched by taxation and generally not subject to the same suffering as others — uses the external threat to aggrandize and gather more power for themselves. The oppressed turn to their leaders for solutions and protection and find only different vultures with better PR. The logical end result of sanctions is the absolute impoverishment of the target population. This appears to be Ottawa’s goal. As shown in the 2019 election, they don’t get many votes in those places anyway. When the actions of Ottawa fit the model of economic warfare so closely, we have to call things as they are. The debate requires honesty about the relationship between Ottawa and the provinces. “If it walks like a duck…” 

“Sustained attacks by Ottawa on private property rights undermine the ability to create wealth.”

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BY JASON EDWARDS

Pipeline Safety, One Step at a Time

ow do you make sure that a 623kilometre stretch of high-pressure liquid petroleum pipeline is safe? You walk its entire length. This is exactly what we did in the summer of 2019 to help our client, Enbridge Inc., meet federal laws intended to protect public safety through regular inspections of pipelines. This includes checking if the pipeline has appropriate depth of cover, to be performed about once every 10 years.

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Another federal requirement is to ensure that the pipeline Right of Way (RoW) markers are in place, visible and in good condition — to be checked about every four years. These signs are generally concentrated at critical areas, including road and railway crossings, as well as at watercourses. At stake is the issue of public safety, but also public service — this 30-inch line is a vital link for keeping the wheels of industry, as well as society as a whole, turning. A farmer’s plough or an excavator’s backhoe causing a pipeline rupture

Photo courtesy PVS Contractors

The value of walking softly and carrying a great app.

Making use of a new phone-based locator app developed by PVS Contractors.

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would be a safety hazard for that person, as well as creating consequences for the public through a risk to our energy supply. Our role at PVS Contractors, as utility location specialists, was to carry out both depth-of-cover and signage inspections of what Enbridge refers to as Line Nine. Our assignment covered the distance from near Hamilton to near Montreal. This included taking a variety of information every 50 metres — sometimes just the location using GPS, and in other cases testing the depth of cover, as well as checking RoW signage. Any places found to have inadequate cover — generally about a metre — would be noted and Enbridge would send a crew to take steps such as backfilling. Locations of missing, damaged or vandalized RoW markers were flagged as well.

“Sometimes, we found our way blocked by electric fences and other such barriers, and had to find the owner of that property before we could continue with our work.” One of Enbridge’s requirements was that there be no vehicles in the RoW, and this ruled out on-road as well as off-road vehicles, even small, single-user machines. So, we pulled on our boots (and on perhaps too many occasions, our chest-waders), set up teams of two for safety, and started walking.

A journey of 623 kilometres starts with … preparation Of course, the first step was preparation and planning. This included having letters sent to property owners along the route, letting them know that there would be surveyors inspecting the RoW, and explaining that the purpose was to ensure public safety. Another part of preparation was making sure our crews would be able to follow the route of the pipe accurately — quite a challenge in some places because of the other utilities also located in some parts of the easement we were following. Part of our success in pipeline location was through a phone-based locator app developed by PVS. It simplified the task of pipeline location, recording the work completed and

“We would hook up our locating equipment to these boxes, which contain electrical charging devices much like car batteries, allowing us to boost the electrical signal that helped us locate the pipeline.”

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the location of anything requiring Enbridge’s attention. Our app also helped with data processing, reducing the need for human input of data, which is time-consuming as well as posing a risk of data gaps and errors.

A less-invasive approach, by foot We found that most people we encountered, including property owners, had no problem with our crews walking through. They just weren’t used to the idea of crews doing the inspection on foot. Previous contractors inspecting the line had done so using motorized vehicles, and this had generated complaints from some landowners about damage to crops. This is one of the factors that motivated Enbridge to require the feet-only approach by our crews. Our work did not generate any complaints at all, which helped Enbridge meet one of its priorities, namely good landowner relations. Another benefit to taking the time to walk the route came in a higher quality of data. One contributor to this was our use of the corrosion test point boxes that Enbridge generally locates on the side of roads where they cross the pipeline route. We would hook up our locating equipment to these boxes, which contain electrical charging devices much like car batteries, allowing us to boost the electrical signal that helped us locate the pipeline.

This produces more accurate data than the method some surveyors rely on — a portable device that shoots electricity and magnetic frequencies into the ground to determine the pipeline’s location and depth. This method has its uses, but sometimes lacks accuracy. In one place, a previous crew had used this method, which produced readings showing the pipe to be 20 metres underground. We checked and found the line to be actually just three metres down. At PVS, our staff are taught to not use this second method without checking with their supervisor, as the data quality may be suspect.

Photo courtesy PVS Contractors

Expect the unexpected We found that our crews would generally cover about 35 km in a day, but only about five of those were actually “productive” kilometres in the sense of covering pipeline RoW. The rest involved getting around obstacles such as rivers, where it was necessary to walk to the nearest bridge and then back on the other side. Sometimes, we found our way blocked by electric fences and other such barriers, and had to find the owner of that property before we could continue with our work. That stretch of southern Ontario and Quebec offered its own natural challenges. About half the distance was wetland, in which crews were testing each step of the way, and in many cases hauling hip-waders out of their packs when ground turned

“Our pedestrian approach to the work paid off. One benefit was being able to interact with landowners in a human way, rather than being considered invaders.” to mostly water. Particularly during the summer heat waves, chest-waders were a hot and thoroughly uncomfortable necessity, to be replaced with regular boots as soon as possible. Along with the mosquitoes and other insects, there were other serious health hazards including giant hogweed, poison ivy and wild parsnip.

The value of intensive, boots-onthe-ground surveying In this case, our pedestrian approach to the work paid off. One benefit was in being able to interact with landowners and other pipeline neighbours in a human way, rather than being considered invaders, as might have been the

case if we had been using vehicles. We could take time to explain the purpose of our work, and we found that most of the people we encountered were pleased that such effort was being taken to ensure their safety. We also gained the professional satisfaction of having done a thorough, reliable job on behalf of landowners, the general public and of our client, Enbridge. 

Jason Edwards is the general manager of PVS Contractors in Ontario. PVS has been in business for over 40 years and completes more than 300,000 utility locates annually in the Greater Toronto Area.

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BY ANDREA DE ROO

Recipe for Restoration How alternative farming practises can revive soil along your right-of-way.

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Manage Livestock

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Soil Armor

Reduced or No Synthetic Inputs

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Reduced or No Tillage

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n our farm, we are making 2020 plans with the hope of a better growing season than what occurred in 2019. For many farmers across Western Canada, May was abnormally dry; rain finally came in mid-June; July was relatively normal; and then Mother Nature had her fun August to October. But farmers were not the only ones affected by the excessive late-season rain. Enbridge workers struggled to get the remaining topsoil back on the land before the snow fell, and unfortunately, were unsuccessful. The company plans to have workers back out in late May to move the topsoil back in place along the 100-km stretch in southeast Saskatchewan. But for now, the soil along the right-of-way and the piled-up topsoil sits exposed, including some of our own land in the Fairlight, Sask. area, along Line 3. As farmers, we will need to take steps to start the recovery process. Whether your right-of-way was covered or not, there are things we can do to protect it come spring. I have talked about the benefits of alternative farming practices on soil health before, but it was not until I attended a presentation by Dr. Kris Nichols at the Saskatchewan Soil Conservation Association annual conference, that I had a ‘recipe’ for how to improve the soil. In her presentation, she introduced the pyramid on the right as keys for soil regeneration.

Figure 1: Soil Regeneration Pyramid: (Dr. Kris Nichols; KRIS Systems Education and Consultation Pachaterrae Inc.)

Diversity Living Roots (Green and Growing)

SOIL REGENERATION PYRAMID Living Roots Roots are like the glue that holds your soil together. Any significant disturbance, like that caused by pipelines, compromises the integrity of the soil structure. Living roots continually feed the soil ecosystem via interactions with fungi, bacteria, and other microorganisms. From these relationships, the roots promote the formation and stability of soil aggregates. This then improves water filtration through increased porosity. Living roots require the plants above ground to be green and growing — harvesting sunlight. Our window of opportunity to keep things green is relatively short. In Western Canada, there are 120-130 frost-free

days and usually 1200-1600 growing degree days, depending on the growing region. Despite these limitations, plants other than the crops we typically grow can utilize the sunlight earlier and longer in the season. Mixing these crops with grain crops or sowing land to perennial hay species can keep the land green outside of the short growing season.

Diversity It is important to consider types of plants, but also microbial and macrobial populations when promoting diversity, or biodiversity. Plant and microbe diversity are closely associated with one another. The different

“Significant disturbance, like that caused by pipelines, compromises the integrity of the soil structure.”

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“Nutrients from manure are in a more plant-available form and promote the increase of microbial populations.”

carbon to nitrogen ratios of plants build microbe populations that break down residues and release nutrients back to the soil. As the microbe population grows, it also aids in the resilience of the soil to environmental conditions (soil aggregates) and can start to protect living plants from the threat of disease and pests. Cover crop mixtures do a great job of increasing plant diversity above ground and building the microbe population below ground.

livestock is a great addition to improving soil health. Proper livestock management improves soil health through nutrient cycling. Nutrients from manure are often in a more plant-available form and also promote the increase in microbial populations. The stress caused by animals on the plant encourages roots to grow deeper,

further improving water infiltration, soil structure and compaction.

Soil Armour Enbridge takes the first step in soil armour once the topsoil is moved back into place, by covering the soil with straw. While this does provide some

1960 1965 1970 1975 1980 1985 1990 1995 2000 2005

Reduced or No Synthetic Inputs Resource intensive agriculture has become the mainstream practice for growing crops in Canada. While fertilizers and pesticides have been beneficial in increasing yield, recent global trends show a plateau and even a decrease in yield (Figure 2). Figure 2: Global trends (19602005) in cereal meat production, use of fertilizers, irrigation, and pesticides. (Source: Tilman, 2002; FAO, 2013; International Fertilizer Association, 2008; FAOSTAT, 2009). The increased use of inputs has had a detrimental effect on the soil’s biological system — limiting the plants’ natural association with beneficial organisms. Reducing the use of these inputs can further assist in the regeneration of soil along the pipeline and encourage the development of more diverse populations.

Manage Livestock Mixed farms have moved to specializing in crops or livestock to improve simplicity and logistics on the farm. But for the few that do have both,

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Figure 2: Global trends (1960-2005) in cereal meat production, use of fertilizers, irrigation, and pesticides. (Source: Tilman, 2002; FAO, 2013; International Fertilizer Association, 2008; FAOSTAT, 2009).

early protection from the elements, it does not start the building process to knit the soil structure together. The best soil armour relates back to the living roots. Just like we protect ourselves from the elements with clothing, plants are the best way to cover the soil. More importantly, plants are able to utilize solar radiation and water with heat to grow and in turn, feed organic matter and nutrients back to the soil.

Reduced or No-Tillage This one is already widely practiced by farmers. The western Prairies have benefited from the introduction of reduced or no-till systems through the building of organic matter and soil structure. Much like the disturbance of installing pipelines or integrity digs, any form of tillage disturbs the soil ecosystem with harmful effects. Reduced tillage allows the soil ecosystem to build up and all of the organisms to function in balance. This is just a short outline of steps we can take to bring the pipeline right-of-ways back to life. While some steps may seem a little extreme, I encourage everyone to consider how they can change management practices on their farm to improve two or three steps. î Ź

Andrea De Roo has a BSA in agronomy and a M.Sc. in plant science. Additionally, she is a P.Ag. with the Saskatchewan Institute of Agrologists. Andrea farms with her family near Fairlight, Saskatchewan, and now also works with South Country Equipment as a Crop Intelligence Agronomist.

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BY ROBYN ALLAN

Want Trans Mountain Expanded at Any Price?

hen Finance Minister Bill Morneau announced Ottawa would buy Trans Mountain for $4.5 billion, he assured Canadians that “this transaction represents a sound investment opportunity.” Facts tell us otherwise. Add up every dollar Ottawa has committed to Trans Mountain since

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Morneau bought it and taxpayers are at risk for $20.7 billion the day the project goes into service. Ottawa tells us not to worry. Trans Mountain’s expansion will earn money when it begins operating sometime in 2023. Except, those revenues won’t cover what Ottawa has ponied up. The shortfall is a subsidy of about $11.7 billion. This is how the math works. There were two price tags for Trans Mountain. The first, $3 billion for a 66-year-old pipeline. The second,

$1.5 billion for the right to build the expansion. Ottawa borrowed the money to buy TransMountain and channeled it through the Canada Development Investment Corporation (CDEV) at an interest rate of 4.7 per cent per year. The principal repayment is due five years from the purchase date. Trans Mountain is a federally regulated pipeline so the Canada Energy Regulator (CER) approves the tolls it can charge to shippers who send oil products down the pipeline. When

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Be careful what you wish for, because taxpayers will be eating the expanding costs of TMX.

“If the Crown now responsible for TMX doesn’t know the current cost estimate for the project but have proceeded with construction, they are guilty of gross mismanagement. If they do know the current cost, they are guilty of misleading the public.”

Trans Mountain sought approval for the tolls on the existing pipeline it failed to ensure those tolls would be enough to cover the $3 billion used to buy it. None of that principal and only half the interest expense is covered by the tolls, and those tolls are locked in for at least three years

The expanding costs of TMX they don’t want you to know about Canadians are at risk for the shortfall and this explains why Trans Mountain has been losing money since Ottawa bought it. The taxpayer funded toll subsidy amounts to $3.4 billion over five years. That’s on the existing pipeline. How much will Trans Mountain’s expansion end up costing? Morneau promised to tell us what the expansion would cost when he shocked Canadians by announcing we would buy it. We were assured that if Ottawa knew it was going to buy Trans Mountain by July 22, 2018, Canadians would be given an update on the construction cost. That date came and went. When the project was approved by Prime Minister Trudeau in June 2019, we were again promised an updated cost, but none was provided. Trans Mountain CEO, Ian Anderson said at the time that “There is no update on the last estimated project cost of $7.4 billion.” At its annual general meeting on December 11, 2019, CDEV’s chair, Steve Swaffield was asked for a budget update. He said “we’ll need more clarity on the project’s schedule before we can determine the costs.”

It seemed very strange that the people responsible didn’t know the cost for the project but were proceeding with construction based on a $7.4 billion estimate prepared almost three years earlier. That is not how major projects are built. Either they were guilty of gross mismanagement if they didn’t know the likely cost, or they were guilty of misleading the public by withholding it. Finally in February 2020, Trans Mountain announced the bad news. The cost to build the expansion, including contingency, had skyrocketed to $13.2 billion. An increase of this magnitude might not be a problem if Trans Mountain could pass this increased cost onto shippers through higher tolls. The problem is, Ottawa decided to give the shippers a toll rate exemption on the expansion too. This is where the huge subsidy on the expansion comes in. Ottawa capped the construction budget at $7.4 billion with only 25 per cent of the costs beyond that amount passed on in shippers’ tolls. What this means is that for every dollar spent on the project above $7.4 billion, Trans Mountain — and by extension Canadian taxpayers — bear 75 cents. At a capital cost of $13.2 billion, Canadians have been put at risk for $4.4 billion of the project’s likely cost.

Taxpayers at risk from hidden subsidies, too Then there’s the $1.5 billion Oceans Protection Plan which is a subsidy because Trans Mountain’s shippers told the CER they expected to pay

any marine protection costs related to the project. Trudeau decided to put the cost on the backs of Canadians instead. Even at a pro-rata share for the West Coast, the cost is about $600 million, every five years. We can’t forget the $500 million payment guarantee to BC. These costs are not included in the project’s budget, but Trans Mountain still has to pay them, so they are a taxpayer funded subsidy too. And then there’s the $1 billion that the CER requires must be on hand for inevitable oil spills. The subsidies for Trans Mountain are huge. Adding up the components we get $3.4 billion for the existing pipeline, $4.4 billion for the expansion, $2.4 billion over twenty years for Trans Mountain’s share of the Oceans Protection Plan, B.C.’s accommodation cost of $500 million, and spill liability obligations of $1 billion for a total taxpayer funded subsidy of $11.7 billion. But there’s more because Ottawa is debt financing the cost of building the expansion. We need to add $9 billion more in obligations beyond the subsidies. We find that Ottawa is into Trans Mountain’s rescue for a whopping $20.7 billion. When Trans Mountain’s expansion becomes operational Ottawa will have committed more than $20 billion dollars in taxpayer funds to the project knowing tolls will repay less than half. Hardly a sound investment when more than half the cost for getting this pipeline built will be subsidized by Canadian taxpayers. 

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B Y D AV E B A S PA LY

onitors provide daily observation of all pipeline-related activity, with independent eyes and ears in order to confirm that agreements you enter and promises made to you are truly kept.

Daily Observation From the moment the first pair of surveyor’s boots set foot on your land — to mark boundaries and place warning stakes to prevent trespasses and line strikes — a construction monitor walks alongside to document that those boots and equipment are not bringing weeds, pathogens or destruction with them.

What Every TMX Landowner Needs To Know About Construction Monitors Don’t let the federal fox guard your henhouse

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A monitor tracks the behavior of all workers and traffic as they enter and leave your community. These monitors watch all activity on your land until the last shovel of your dirt is put back where it belongs. On your own, you cannot possibly maintain such a vigil. Construction monitors pay attention for you.

Alamy Stock Photos / Old Paper Studios

“On your own, you cannot possibly maintain such a vigil.”

Confirm Every day a construction monitor submits a report — pictures and description — of what type of activity took place on your land, where and when. This record includes the weather and soil conditions under which the work took place as well as the type of equipment and practices used. Most importantly, monitors document the result and quality of all work. This record can be referenced to resolve any future dispute regarding damages or compensation.

Independent Monitor reports are submitted to both the pipeline company and landowner representatives so that both parties have equal access to the facts on the ground. Most potential disputes can be avoided when all parties have access to the same quality information. Since knowledge is power, independent construction monitors ensure that you stand on equal footing with all stakeholders.

Meanwhile, on the TransMountain Pipleline Project… Construction monitors are the only truly independent set of eyes and ears you can have. This is the first pipeline project in our nation’s history where the same group performing the work (the Canadian government) is attempting to oversee the quality of the work — the Canadian government through the Canada Energy Regulator (CER). This is never a good idea. Imagine if the federal government owned and ran the Toronto Maple Leafs and insisted on controlling all rules and referees for the entire NHL as well.

“Construction monitors ensure that you stand on equal footing with all stakeholders.”

Now, factor in that the CER has demonstrated a higher sensitivity to the concerns of all stakeholders other than landowners, and you realize how essential it is to have a robust group of independent construction monitors on this project. The TransMountain Project is unique in one other respect. Every landowner is also a stakeholder in the success of the project as a taxpaying citizen of Canada. We all have a vested interest that this project is conducted in an environmentally safe, economically sound, and relationally equitable manner. Perhaps the most overlooked advantage of independent construction monitors is that they save time and money for every pipeline project.

Here are two small examples of daily occurrences from projects conducted in Canada this year:

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An independent monitor spotted three rolling hills in the terrain of a farmer’s field where topsoil had just been replaced after pipeline construction. He alerted inspectors who confirmed that a contract operator had buried three utility ramps with topsoil. Such ramps are designed as temporary protection for crossing cables, or “hotlines.” They must be removed before reclamation. The company immediately brought in equipment and personnel from an adjacent section to correct the problem. Had this error gone undetected until the end of the project or later, soils would have been lost forever and the cost to mobilize crews to repair the site would have been multiple times higher for the company.

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A fencing contractor employee tasked to erect a temporary boundary to prevent cattle from falling into an open pipeline trench attempted to save time and effort by placing one less post near a corner gate. His version of a fence would have prevented mature cows from escaping onto the Right-ofWay. But cattle are raised as cow-calf pairs. Calves are small and curious enough to squeeze through narrow fence gaps and become lost, injured or killed. In this case, our monitor pointed out the gap to responsible leaders who quickly added a post. A small thing? Perhaps, but not to that rancher, and not to the company and pipeline industry as a whole.

Without a watchful, independent eye, preventable landowner losses happen nearly every day on pipeline projects, and they cost more than money. They cost reputation and relationships between the pipeline industry and landowners. Cumulatively, they send a message to landowners that “the company” values a $5 fence post over respect for landowners and their livelihoods. Responsible companies know that they can’t afford such a message. Pipeline companies can’t afford to operate without independent monitors. 

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.

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When Pollution Is a Violation of Property Rights

Government legislation licenses bad corporate behaviourâ&#x20AC;¦

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rgaworld is a company that operates a waste treatment facility in London, Ontario, but it also emits offensive odours that affect residents and businesses in the surrounding community. This has been an ongoing problem since 2007, when the plant opened. Despite numerous charges and fines levied by Ontario’s Ministry of Environment, Orgaworld continues to violate the law. The government claims to protect communities and the environment. As Ministry spokesperson Kate Jordan said in reference to Orgaworld’s 2014 fine, “It not only resolves this issue, but as ‘a significant penalty,’ it acts as a deterrent to future problems.” Except it didn’t. Problems persist. The government continually breaks its promise to protect “communities and the environment.” But this should not surprise us. The government’s refusal to protect the property rights of residents is a direct consequence of its immoral process of law-making, which fails to address the relationship between polluters and those whose property is affected. If a more effective and just legal regime were used, you would likely not be reading this article because it is virtually certain that Orgaworld would not exist in its current location.

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Who should make the laws? As it is, regulatory laws made at legislatures and government agencies against environmental pollution are made without the involvement of those who are affected by extant cases of pollution. These laws, written primarily by special interest groups, favour only certain groups at the expense of ordinary residents who

are generally excluded from the lawmaking process. This helps explain why polluters can persist as polluters without being answerable to those who are most directly affected by the pollution. Moreover, those who must pay taxes for the government “services” of preventing trespass on private property, via pollution, often don’t actually receive these services in return. This has been true in the Orgaworld case.

A sea change is needed in law-making To more directly address the property rights of those who are subjected to polluters like Orgaworld, we must go back to earlier, less authoritarian, and more effective means of making law. Government lawmaking via legislatures is a recent development. In the past, “bottom-up law-making,” or customary law, was more commonly used to address issues of property violations through the courts. Those who were directly affected, if they could prove they had been harmed, received recompense directly from the violators. Modern legislature and administrative lawmaking, in contrast, relies primarily on levying fines against polluters, with fines going to government and not to the victims. Moreover, the victims are not involved in these deals between regulators and polluters. Thus, we might think of laws made by the government as being ‘top-down law-making,’ or authoritarian law.

Customary Law — the moral solution Though Orgaworld’s actions are considered illegal under our system of authoritarian law, it is clear that the prevailing legal framework has failed

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“In contrast, Orgaworld seems to be a winner. It has been fined, yet it continues to operate. It would seem that from Orgaworld’s perspective, fines are simply a cost of doing business — there are still profits to be made after fines have been paid to the government.” to provide a resolution. It appears that the polluters will be allowed to continue functioning indefinitely should they meet the requirements of regulatory agencies, which are quite independent from the property owners subject to Orgaworld’s violations. In contrast, under a system of Customary Law, the people themselves (not the government) would play a prominent role in the legal process. In such a system, Orgaworld’s actions would be considered illegal, not because it is polluting the air per se, but because the affected neighbouring properties were owned and occupied prior to Orgaworld’s actions. This is a very important point, as Murray Rothbard explains with the homesteading concept: “Most of us think of homesteading unused resources in the old-fashioned sense of clearing a piece of unowned land and farming the soil. There are, however, more sophisticated and modern forms of homesteading, which should establish a property right. Suppose, for example, that an airport is established with a great deal of empty land around it. The airport exudes a noise level of, say, X decibels, with the sound waves traveling over the empty land. A housing development then buys land near the airport. Sometime later, the homeowners sue the airport for excessive noise interfering with the use and quiet enjoyment of the houses. “Excessive noise can be considered a form of aggression but in this case the airport has already homesteaded X decibels worth of noise. By its prior claim, the airport now ‘owns the right’ to emit X decibels of noise in the surrounding area. In legal terms,

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we can then say that the airport, through homesteading, has earned an easement right to creating X decibels of noise. This homesteaded easement is an example of the ancient legal concept of ‘prescription,’ in which a certain activity earns a prescriptive property right to the person engaging in the action. “On the other hand, if the airport starts to increase noise levels, then the homeowners could sue or enjoin the airport from its noise aggression for the extra decibels, which had not been homesteaded. Of course, if a new airport is built and begins to send out noise of X decibels onto the existing surrounding homes, the airport becomes fully liable for the noise invasion. It should be clear that the same theory should apply to air pollution. If A is causing pollution of B’s air, and this can be proven beyond a reasonable doubt, then this is aggression and it should be enjoined and damages paid in accordance with strict liability, unless A had been there first and had already been polluting the air before B’s property was developed. For example, if a factory owned by A polluted originally unused property, up to a certain amount of pollutant X, then A can be said to have homesteaded a pollution easement of a certain degree and type.” Orgaworld is violating the property rights of its pre-existing neighbours. Orgaworld’s actions, as Rothbard noted, constitute “aggression and it should be enjoined and damages paid in accordance with strict liability.” Under Customary Law, such a legal remedy would have been immediately available to the neigh-

bours after Orgaworld’s first violation many years ago. Authoritarian Law provides no such remedy. Authoritarian law encourages a violation of property rights The quality of life has declined for residents and businesses in the community surrounding Orgaworld. Revolting odours often prevent them from spending time outdoors. Property values are falling, and other economic consequences have been felt. Stress levels are high, and none of the residents have been financially compensated for harm done. For 10 years, residents and businesses have been the losers in this case. In contrast, Orgaworld seems to be a winner. It has been fined, yet it continues to operate. It would seem that from Orgaworld’s perspective, fines are simply a cost of doing business — there are still profits to be made after fines have been paid to the government. Thus, it seems the government is also a winner because it retains the fine money for its own use, as it simultaneously pretends to “protect communities and the environment.” The optics are not good. Orgaworld appears to be buying permission from the government to pollute the air of its neighbours. The government is supposed to resolve conflicts, not create them. Perhaps it is time to reconsider how we make laws and protect property rights.  Following a 23-year career in the Canadian financial industry, Lee Friday has spent many years studying economics, politics, and social issues. He operates a news site at www.LondonNews1.com

BY SHANNON DOKA

5 Ws to Safe Digging in Saskatchewan

iStock / shaojiankang

Digging can be carried out by just about anyone, including homeowners, farmers, contractors, home builders, equipment operators, landscapers, land surveyors, developers, even urban and rural municipalities.

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Under OH&S Regulations, the locations of underground utilities must be accurately established prior to breaking the ground surface where work is to be done, with any equipment, to a depth that may contact the underground utilities.

Who we are

The Saskatchewan Common Ground Alliance (SCGA) works with industry stakeholders and the digging community to promote effective damage prevention and safe excavation practices, with the goal of reducing damages to buried utilities. Membership in the SCGA is open to anyone with a genuine interest in reducing damages to the underground infrastructure. We all share in that responsibility. We are currently funded by 83 corporate members. The fact that underground infrastructure(s) are buried not far from the ground’s surface increases the risk of accident during excavation or rehabilitation work. Despite all efforts made to increase awareness on the importance of exercising vigilance during excavation work, damages still occur too often. There are six other Regional Common Ground Alliances, located in British Columbia, Alberta, Manitoba, Ontario, Quebec and Atlantic Canada. Our national organization in Canada is the Canadian Common Ground Alliance. The largest one in North America is the Common Ground Alliance in the United States (CGA).

What we do

The SCGA works alongside Sask 1st Call in promoting “Click Before You Dig!” and “Dig Safe!” Sask 1st Call is the “Before You Dig” location-screening and notification service for contractors, landowners and homeowners who are planning all types of digging or

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excavating. Once contacted, Sask 1st Call will issue line-locate request notifications to subscriber companies to notify them of the planned ground disturbance. The affected companies will ensure their underground facilities are clearly marked before work starts. Sask 1st Call benefits Saskatchewan people by reducing the number of requests an excavator needs to make to underground facility owners when planning to dig or excavate, in addition to protecting the environment and the integrity of essential services. Sask 1st Call will screen and/or notify many subscriber companies with just one point of contact.

Where

Throughout Saskatchewan, there are thousands of kilometres of underground infrastructure. In fact, underneath much of our farmland lies buried pipeline and utilities. These utilities may carry natural gas or oil, electricity, communication lines or water. Any one of these utilities struck during a

farming operation can cause dangerous consequences for you, your family, tenants, hired hands, your neighbours, your community and the environment, possibly impacting your farm for years.

When

Sask 1st Call is the first contact you should make. However, there may be other companies who have underground facilities in your work area that are not subscribers to Sask 1st Call. Excavators may need to work through land titles, municipalities, cities and towns, to find those unregistered with Sask 1st Call. The excavator (contractor, landowner, homeowner) is responsible to notify those companies of your proposed excavation and locate or hire someone to find landowner (privately owned) facilities. You should also understand that you are not clear to excavate until all Sask 1st Call subscribers have been notified and have located their facilities in your work area or advised you to proceed. It is the excavator’s

Always know what's below! Click Before You Dig costs nothing, not clicking before you dig could cost you and your neighbours everything.

CCGA and Regional Partners

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The Cost! The cost of damage to underground infrastructures is estimated to be over $1 billion per year.

U More than 47 damages occurred per work day. U The total number of damages Canada wide, totalled 11,693, which is 2.6% more than in 2017. �

U Natural gas and telecommunication facilities were affected in 82% of damages, 42% and 40% respectively. � � � �

responsibility not to damage the facilities, and placing a call to Sask 1st Call does not remove that responsibility. Prior to any work being done, excavators must be aware that privately (e.g. landowners with services after the meter) buried facilities may exist within a work area, and they are generally responsible by law to locate those facilities or hire someone to locate them.

Why

Year after year, the societal costs related to damages are significant. In Canada, this type of cost is estimated to be over $1 billion per year. They reflect both direct costs (e.g., cost to repair damaged underground infrastructures) and indirect costs (e.g., loss of productivity due to downtime resulting from damages) including but not limited to:

➥

U Hoe/trencher was the most common equipment type used in damages (68%). Equipment type was omitted in almost one third (29%) of reported damages

U Work on water and sewer systems accounted for 31% of damages. U The most common known root cause of damages was excavation issue (38%).

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and potential ➥ Injury loss of life

➥ ➥

Service disruption

➥ ➥ ➥

Evacuation

➥ ➥ ➥

Economic impact

Deployment of emergency services

Loss of product

RECALL: Note that damages are reported to DIRT on a voluntary basis and thus do not reflect the total number of damages that take place in a year in Canadian provinces. Excerpt from 2018 DIRT Report

sask1stcall.com 1-866-828-4888

! Make the free call to Sask 1st Call to get your underground utilities marked every time before you dig.

Environmental impact and mitigation

Work delays Administrative and legal costs

who work or live in the vicinity of underground facilities and protecting our vital services is everyone’s responsibility.  For more information about the SCGA go to scga.ca or email executivedirector@scga.ca.

Whether you are a facility owner/ operator, locator, design professional, excavator/contractor or other stakeholder, ensuring the safety of those

Shannon Doka is the Executive Director of the Saskatchewan Common Ground Alliance

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BY DALE SWAMPY

New UN Legislation Wages War on Indigenous Anti-Poverty Efforts UNDRIP is one more weapon activists can use to undermine First Nations and landowners.

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“Despite what you may have heard in media headlines, only four First Nations oppose TMX and only a handful of hereditary chiefs oppose CGL.”

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o First Nation, and I expect no landowner, would argue that the government or corporations should be able to do whatever they want on our lands and territories, without consultation, accommodation or compensation. At the same time, most of us want development, when we are included and benefit from it, because of the revenues and employment it creates. For most First Nations, povertyrelated issues, such as addictions, violence, and poor health, will only be addressed when our economies are developed and our people have access to good jobs, a decent income, and health and social services funded and led by the First Nation itself. One important source of economic development for First Nations, espe-

cially in Western Canada, is pipelines. Large projects such as TMX, Coastal Gas Link and Line 3 have signed agreements with well over a hundred Indigenous communities and organizations: 48 in the case of TMX, 20 in the case of CGL, and 98 in the case of Line 3. Despite what you may have heard in media headlines, only four First Nations oppose TMX, and only a handful of hereditary chiefs oppose CGL. Pipelines require consent from nations and landowners across vast distances. If 90 per cent of those impacted want to go forward with development, do the minority in opposition have the right to say “no” and veto such a project? Even when all potential harm has been reasonably mitigated, and such a rejection would have negative economic and social impacts in the form of foregone revenues and jobs?

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“First Nations are trying to develop our economies to lift our people out of poverty and give them the opportunity to have a livelihood. We need to be able to say yes to development that benefits us.” That is the concern many of us have with the new United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP) legislation passed in B.C. as Bill 41. The federal government has also made it a commitment to introduce new UNDRIP legislation within the year. The controversy over Bill 41 turns on its promise to provide Indigenous peoples with “free, prior and informed consent.” Those who have promoted the introduction of UNDRIP into Canadian law have assured us that its intentions are noble and its impacts benign. B.C. Minister of Indigenous Relations and Reconciliation Scott Fraser said in the Legislature that UNDRIP does not include the word veto and does not provide for one. Romeo Saganash, the MP who introduced the UNDRIP legislation in the federal parliament through Bill 262, said that “the right to free, prior, and informed consent, like all human rights…is a relative right. You need to balance that right with the rights and interests of others, which veto does not do.” And Murray Sinclair, Bill 262’s sponsor in the Senate, said that if there is “a reasonable accommodation being offered, if there is still continued refusal to accept the offer being made, then there might be room for the government simply to proceed with its sovereignty, decision-making power.” This sounds reassuring. The problem is, the actual legislation doesn’t

make this clear. It doesn’t define consent, it doesn’t say there’s no veto, and it doesn’t outline a process to resolve lack of consensus. Many legal experts argue that the legislation as written is vague and poorly drafted, with internal inconsistencies, uncertain applications and unclear objectives. And it is that legislation, not proponents’ feelings about it, that will constitute the law. What does this mean in practice? That those who are opposed to new development — and there are some extremists in both the Indigenous and non-Indigenous communities that see oil and gas projects under any circumstances as illegitimate — will have one more tool to challenge and delay good projects in court. Even if these challenges are eventually dismissed, investors have no desire to pay for costly and lengthy legal challenges that our unclear processes and regulations provide space for, and which environmental NGOs know how to manipulate. There are other jurisdictions they can invest in where the risks and requirements are better understood. In fact, the ease of doing business in Canada has dropped from 8th in the world in 2009, to 23rd today, according to the World Bank. First Nations are trying to develop our economies to lift our people out of poverty and give them the opportunity to have a livelihood. We need to have the right to say no to development that negatively impacts us,

“UNDRIP legislation has the potential to make Indigenous territories even more risky to conduct business in.”

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but we also need to be able to say yes to development that benefits us. The Canadian legal structure, in particular the Indian Act, often denies basic property and contractual rights on reserve. This makes it next to impossible to attract investment or requires nations and their partners to develop unique arrangements at considerable cost and time. UNDRIP legislation has the potential to make Indigenous territories even more risky to conduct business in. This will continue to deter economic investments, business development and employment on our reserves and in our territories, and keep us in poverty. First Nations are united in wanting better engagement and involvement in projects that affect our people and territories. But no one knows how the courts will interpret Bill 41. It is my fear that those who oppose resource development under any circumstance will weaponize UNDRIP against First Nations and other rural landowners who are in favour of such development. 

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.

Only a few provinces benefit from pipelines move billions of dollars into Canadaâ&#x20AC;&#x2122;s economy nationwide.

Pipelines drive prosperity across Canada through employment and billions for vital government programs like education and health care. To see how, visit: SHAREDFUTURE.CA/ECONOMY CAEPL A .ORG

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Deep roots. We didnâ&#x20AC;&#x2122;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.

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