If opposition to Canadian exclusive jurisdiction over inter-provincial pipelines grows, would Supreme Court back “co-operative federalism”?

“Sabre rattling doesn’t get you very far,” was Premier John Horgan’s response to the decision by Alberta to ban BC wines. He’s right. After several years of a deft touch on the Trans Mountain Expansion pipeline file, Rachel Notley has made her first misstep in the escalating feud with her fellow NDP premier. What she should do is continue to emphasize exclusive federal authority over inter-provincial pipelines and leave the heavy lifting to Ottawa and the National Energy Board.

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BC Premier John Horgan.

The issue at hand is last week’s announcement that BC might consider ”[r]estrictions on the increase of diluted bitumen (“dilbit”) transportation until the behaviour of spilled bitumen can be better understood and there is certainty regarding the ability to adequately mitigate spills.”

Given the Horgan Government’s opposition and delaying tactics on the project since the BC NDP formed government last summer, no one believes outside of Vancouver believes the proposed restriction is anything but a delaying tactic designed to frustrate the Texas-based pipeline company until it gives up and cancels the 525,000 b/d pipeline that will start near Edmonton and terminate in Burnaby.

Horgan’s description his government’s intent is comically inept.

“We’ve not put in place anything at this time,” Horgan told reporters. “We’re going to put in place a scientific panel to look at the potential consequences of a catastrophic (bitumen) spill. I don’t think that’s unreasonable and I’m surprised at the response we’re getting from Alberta.”

The Alberta premier, an old colleague of Horgan’s from their days in the Glen Clark government of the 1990s, probably rolled her eyes at that stretcher.

Horgan is being disingenuous, but he’s also being very clever.

As a student of history (he has an M.A. from the University of Sydney), he knows that under the Canadian Constitution the federal government has exclusive authority over inter-provincial pipelines. And if he didn’t know before becoming premier, he certainly understands now that the principle of paramountcy means that when federal and provincial laws conflict, Canada trumps BC.

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Alberta Premier Rachel Notley. Source: CBC.

In this case, that means the National Energy Board can issue any permit or approval required by BC law.

The NEB has already twice granted permits required by the Burnaby when the regulator determined the City was

There is only one thing that can trump the Constitution: politics.

Horgan’s only hope is that before Kinder Morgan begins construction in BC this fall, that opposition to Trans Mountain Expansion becomes so fierce that the Province and the municipalities like Burnaby have public support for their foot dragging strategy.

Prime Minister Justin Trudeau is adamant the pipeline will be built, but the company has already said delays are costing it up to $35 million a month and its patience has a limit.

Which means Horgan has to grasp at every opportunity to rile up not only the 50 per cent of British Columbians who dislike the pipeline, but the remaining half that are supportive.

What better way to start than having Alberta declare war on the provincial wine industry?

“We will not let the Government of BC hold Alberta’s and Canada’s economy hostage, and jeopardize the economic security of hundreds of thousands of working families across this province and across this country,” Notley said Tuesday afternoon at a media conference.

Not only will the Alberta Liquor and Gaming Commission not spend $70 million buying BC wines, but Albertans will be prohibited from ordering by phone, email, online to be shipped from BC.

“My immediate reaction is this is utterly stupid,” Jeff Guignard, executive director of the Alliance of Beverage Licensees, told Edmonton Journal reporter Emma Graney. “Punishing British Columbia wineries for something that they have nothing to do with is frankly … amateurishly political…I think Albertans should be embarrassed their premier is advocating for it.”

Albertans really should be embarrassed.

The far smarter play? Let Horgan hang himself.

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Prof. James Coleman, Dedman School of Law, Southern Methodist University.

“If there’s just some law on the books that forbids the transport [of dilbit in a pipeline] it’s possible that Kinder Morgan could just ignore it on the assumption that it’s invalid,” Prof. James Coleman of the Dedman Law School, Southern Methodist University, said in an interview. The company could just say to the BC government, “‘There’s no way you can enforce that law against us.”‘ 

Attempts to enforce the the prohibition would almost certainly fail in a court of law, says Coleman. And if BC tried to punish Kinder Morgan by refusing permits or approvals, those could be granted by the NEB.

In other words, if the system has worked in Trans Mountain Expansion’s favour thus far, don’t mess with a good thing.

Turning up the political heat, however, could have serious unintended consequences for Alberta.

“Ultimately, we might need the Supreme Court of Canada to tell us if they want to move away from those older decisions, which are pretty clear that the federal government has paramountcy over inter-provincial pipelines,” he said.

“If Canada’s going to move from paramountcy toward the overlapping jurisdiction of co-operative federalism, there are some reasons that you could imagine that happening, such as Canadians feeling there is this nation-wide movement for provinces to play a bigger role to play over pipelines.”

Hmm, which provinces might be interested in co-regulating pipelines with Ottawa? Well, after the Energy East debacle, Quebec comes to mind.

Ontario probably wouldn’t be far behind. Indigenous communities would jump at the chance to gain jurisdiction in this area.

And that’s how a minor hot-headed squabble over wine between BC and Alberta ends up gutting the constitutional authority Alberta needs to get pipelines built.

Is that scenario likely? Probably as likely as BC backing down on Trans Mountain Expansion, but never say never.

Premier Notley should have said “never” when her advisers presented the bone-headed wine ban idea to her and let the NEB continue to fight Alberta battles with British Columbia.