Bloomberg News

Canada Plans to Speed Up Environmental Project Reviews

April 17, 2012

Canada will speed up and simplify environmental reviews for major energy and mining projects, the federal government said today, expanding on plans first announced in the government’s March 29 budget.

Details released by Natural Resources Minister Joe Oliver show there will be hard deadlines on the approvals process, a consolidation of the agencies that conduct environmental reviews to three from 40, and provincial agencies will study smaller projects in a bid to reduce duplication.

“It will help prevent the long delays in reviewing major economic projects that kill potential jobs and stall economic growth,” Oliver said in Toronto. “The bill will be tabled fairly soon.”

Canada is betting oil companies such as Suncor Energy Inc. (SU) and Enbridge Inc. (ENB) will boost the world’s 10th-largest economy out of a sluggish recovery. The measures will seek to expedite the environmental review of Enbridge’s Northern Gateway pipeline, which would move crude from Alberta’s oil sands to the West Coast where it can be shipped to Asia, capitalizing on demand for natural resources.

Under the proposed rules, the maximum time frame would be limited to two years for a major environmental review panel, 18 months for National Energy Board hearings and 12 months for standard environmental assessments, Oliver said.

The government would decide within 45 days if a federal review is required, Oliver said.

Northern Gateway

Since winning a parliamentary majority in last year’s elections, Prime Minister Stephen Harper’s Conservative government has pledged to support economic growth by developing the country’s resource wealth and encouraging business investment.

The government began hearings in January on Northern Gateway, which has become a flash point between environmentalists and Harper’s government. Regulators have received more than 4,000 requests by individuals to testify at public hearings.

Environmental and aboriginal groups say the project will increase the risk of an oil spill off the coast of British Columbia. The regulatory panel has said it plans to complete the review by the end of 2013. The government’s proposal won’t cancel reviews that have started, Oliver said.

Kinder Morgan Energy Partners LP (KMP:US) plans to expand its Trans Mountain pipeline from Alberta to Vancouver and file its application to Canadian regulators “late next year,” Ian Anderson, who heads the company’s Canadian division, said in an interview on BNN television.

‘Good Public Policy’

“What they’re doing in Ottawa is they’re making some very good public policy decisions around how major projects are defined, how the scope of the reviews are to occur and create predictable, efficient time lines for everybody,” he said.

The federal government’s plan narrows the focus of its main environmental assessment agency so it can accelerate reviews of major industrial projects. The Canadian Environmental Assessment Agency examines projects that receive funding from or require the approval of the federal government, including oil and gas pipelines.

“These changes make it clear that powerful oil interests are running the show with the federal government bending over backward to do their bidding,” Gillian McEachern, deputy campaign director of Environmental Defence, a Toronto-based advocacy group, said in an e-mailed statement.

‘Sloppy Environmental Protection’

“Canadians will get weaker, less-informed decision-making, sloppy environmental protection by resource developers, and an increased likelihood of environmental impacts,” Simon Dyer, policy director at the Pembina Institute in Calgary, said by e- mail.

Reducing the agency’s workload would eliminate redundancies created by overlapping reviews also done by Canada’s provinces, according to the government document.

Provinces will have the final say in smaller projects after demonstrating they are capable of conducting a “comprehensive, scientific, objective environmental review,” Oliver said. “We don’t second guess their conclusion,” he said.

The federal government and the provinces agreed last year to pursue the goal of “one-project, one-review” for environmental assessments and regulatory reviews.

Major Projects

Canada expects 500 new major projects valued at about C$500 billion ($506 billion) to qualify for federal review over the next decade, Oliver said. Any pipeline longer than 40 kilometers (25 miles) will qualify as a major project.

Oliver also said the government would spend more than C$35 million on marine safety, including requirements for double hulled tankers, and C$13.5 million on more pipeline inspections over two years.

The proposed legislation will introduce fines of C$100,000 to C$400,000 against companies that violate environmental review decisions, and as much as $100,000 for breaking nuclear safety and energy board laws, according to the document. Also, the federal environment ministry can order an assessment for any project subject to federal jurisdiction.

To contact the reporter on this story: Colin McClelland in Toronto at cmcclelland1@bloomberg.net

To contact the editor responsible for this story: David Scanlan at dscanlan@bloomberg.net


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