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First Nations Hold the Cards in Northern Gateway Battle with Enbridge

A single holdout could mean indefinite delay. The situation shows how difficult it will be to export Alberta oil sands to Asia.

By Stacy Feldman and Kathryn Doyle, InsideClimate News

Jul 30, 2012
The Northern Gateway twin pipeline system would run 731 miles from Bruderheim, A

When the National Transportation Safety Board released a scathing report this month faulting Enbridge for its Michigan oil spill, speculation began instantly about whether it would harm the company's chances for its Northern Gateway pipeline to the Pacific Coast of British Columbia.

Even without the report, however, the project's prospects have long been slim at best.

That's because most First Nations in B.C.—where more than half the pipeline would pass—never signed treaties ceding their lands to the Canadian government. Despite offers from Enbridge that would give them a 10 percent equity stake worth millions of dollars and other cash benefits, many still refuse to give the needed right of way, setting up a legal clash that could end up at the Supreme Court.

A single holdout could delay the pipeline for many years, if not indefinitely—even if the project wins approval from Prime Minister Stephen Harper's Conservative government.

The debate over the Gateway mirrors that of the Keystone XL pipeline fight in the United States, with one major difference: While U.S. opponents of the Keystone XL are in a David and Goliath contest with TransCanada, that pipeline's builder, the power wielded by the First Nations has made the battle over the Gateway much more even.

"Enbridge has set themselves up for a legal quagmire a lot worse than they ever considered," said Roger Harris, a former vice-president of aboriginal and community partnerships for Enbridge Northern Gateway Pipelines.

The situation shows how difficult it will be to move Alberta's landlocked tar sands to Asia-bound tankers on the West Coast—a long-time goal of industry that became more urgent when the Obama administration rejected the Keystone XL's northern leg from Alberta to Oklahoma.

"Once Canada decided to give near sovereign authority to individual native groups it was like opening a pandora's box," said Jan Stuart, head of energy research at Credit Suisse. "How are you going to get the right of way to build such pipelines [to the West Coast]?"

Jennifer Griffith, legal counsel for the Haisla Nation in B.C., said her clients are unwilling to open their land to any unrefined petroleum product, because they fear leaks would contaminate their salmon-spawning rivers. The Gateway pipeline—like the Michigan line that ruptured in 2010, and like the proposed Keystone XL—would carry diluted bitumen or dilbit (crude oil from Canada's tar sands) .  

A seven-month investigation by InsideClimate News into the Michigan oil spill revealed that dilbit, which has the thickness of peanut butter, made traditional oil cleanup methods almost useless and compounded the concerns of health officials.

"Haisla doesn't think this project can be done in a way that is not a threat to the health of the nation," Griffith said.

"Haisla are not against industry," she added.  The band, for instance, has a stake in a massive liquefied natural gas project in the same area.

Exact Support Unclear, but Clearly Lacking

Canada has more than 630 First Nations groups. One hundred and sixteen of them are in B.C. and by and large have titles to their lands. In Alberta, where 40 percent of the Gateway would cross, First Nations' land rights were relinquished in treaty negotiations beginning in the late 1870s, as in much of Canada.

In an historic 1997 Supreme Court decision, the court ruled that First Nation land entitlements still stand in B.C. and said "Aboriginal title lands must not be used in a way that is irreconcilable with the nature of the group's attachment to the land."

However, the court did not give the bands blanket veto over government-approved projects but rather the right to consultation. "In order for the Crown [the government of Canada] to justify an infringement of Aboriginal title, it must demonstrate a compelling and substantive legislative objective, it must have consulted with the Aboriginal group prior to acting, and in some cases, compensation may be required," the court said.

The lack of details in the court's decision on what constitutes acceptable consultation, among other issues, opens the door to a torrent of litigation, experts say.

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