B.C., Alberta premiers clash over Gateway pipeline revenue

The fight between the premiers of B.C. and Alberta over how to divide the revenues from Enbridge's proposed Northern Gateway pipeline is quickly heating — even before the $5.5 billion project has approval to go ahead.

B.C. Premier Christy Clark told CBC Radio on Tuesday morning that the province will only approve the project if it gets its fair share of the revenue from the proposed crude oil pipeline, in order to compensate the province for taking on the majority of the environmental risk.

"Alberta's interests in this are pretty obvious. Alberta gets the large bulk of the benefits, takes very little of the risk. B.C. takes most of the risk and we get very few of the benefits. So I think it's pretty obvious that we have some talking to do here," said Clark.

But Alberta Premier Alison Redford said Clark is simply pitting one province against another, rather than doing what is best for Canada as a whole.

"We will not share royalties and I see nothing else proposed and would not be prepared to consider anything else at this time," Redford said in Edmonton on Tuesday morning. 

"It's not how Canada has worked. It's not how Canada has succeeded, and I'm disappointed to hear the comments."

Redford said she was not interested in cutting a deal with B.C. and suggested the province would have to look to the federal government for a transfer payment if it wanted a larger share of the pipeline revenue.  

"We have in our provinces the right to income from resources. We have Confederation, which allows for people in each province to benefit from the resources they have to retain jurisdiction over those resources, and then to be part of federal system that allows for transfer payments," said Redford.

"Leadership is not about dividing Canadians and pitting one province against another. Leadership is about working together. That’s when our country benefits, that’s when Canada leads," Redford also said in statement issued on Monday.

'Troubling precedent,' says Saskatchewan premier

Saskatchewan Premier Brad Wall echoed Redford's concerns, saying cutting B.C. a share of the royalties would set a "troubling precedent," especially for landlocked provinces that have no ports to get their exports to foreign markets.

"This is the thin edge of a very big wedge," Wall told CBC News Network's Power and Politics on Tuesday.

"You can't just say look we only want to do this in the case of bitumen. What about the rail transport of other minerals? Or perhaps ... potentially dangerous chemicals that are manufactured in other parts of Canada and shipped across?"

The three premiers are expected to meet in Halifax this week, but Alberta's strong reaction to B.C.'s proposal on Monday could lead to some tension in the room when the premiers begin their talks on Thursday. 

Redford was hoping to use this week's meeting of the Council of the Federation in Halifax to garner widespread support for her proposed national energy strategy. She talked up the idea with other western premiers at their meeting in late May, but Clark did not attend that gathering.

Enbridge spokesman Todd Nogier called the debate over revenue an "opportunity," but said the existing deal would already give B.C. tangible benefits.

"The tax revenue that would flow to the B.C. government would be $1.2 billion over the course of 30 years. There will be about 560 to 600 full-time jobs, good-paying full-time permanent positions," said Nogier

Under the current terms, B.C. Environment Minister Terry Lake said Monday that British Columbia would get only eight per cent of the pipeline revenue while assuming 100 per cent of the marine risk for the port terminal and tanker traffic on the West Coast, and 58 per cent of the land-based risk for the pipeline.

'We need the market access'

The Alberta premier also said the additional safety measures proposed by Enbridge last week should quell any concerns about the environmental risk.

"The fact that pipelines are still by far the safest means by which to transport oil, significantly mitigate the environmental risk and weaken the B.C. government’s argument for compensation based on potential risk."

Alberta Energy Minister Ken Hughes has also defended the Northern Gateway project, saying the pipeline review he ordered on Friday should take care of any safety concerns around the proposal.

Alberta Intergovernmental Affairs Minister Cal Dallas also dismissed the idea of paying for B.C.'s approval.

"We don't have any history of sharing in uranium in Saskatchewan or the vast mining resources that exist in Ontario and Quebec, and certainly with respect to forestry products and the like that move from west to east from British Columbia."

Dallas says Alberta was hoping to have full co-operation from B.C. in winning public support for the pipeline.

"Obviously we're going to pursue every available option that we have. We need the market access. We need to move product to market."

5 criteria laid out by B.C.

Premier Clark has yet to say if B.C. will give its approval to the controversial pipeline.

"It hasn't even finished its environmental review. The company changed their proposal last week and I imagine it will change again before we get to the end of the process," Clark told CBC Radio.

"So we don't have all the information yet, no one has all the information yet, no one has all the information and I don't think anyone could sensibly say well gee we know enough about it to be able to say yes or no at this stage," she said.

B.C. has also yet to put a price tag on its approval of the project, but financial compensation is just one of the five criteria laid out by B.C. on Monday for its approval of the pipeline.

"I can't put a number on that today, but I can say it doesn't matter what the number is if we can't make sure we do this in a way that protects the environment," said Lake.

The other criteria include a successful completion of the federal review, upgrading the marine and land oil spill response capabilities at the federal and provincial levels, and addressing the legal requirements regarding First Nations' aboriginal and treaty rights.

First Nations' and environmental concerns

The new criteria are just the latest challenges for Enbridge's proposed $5.5-billion pipeline to link Alberta's oilsands with a West Coast tanker port, which is already facing stiff opposition from First Nations, environmentalists and B.C.'s opposition New Democrats.

Forest Ethics spokeswoman Tzeporah Berman was one of several environmentalists to point out the unrefined crude oil the pipeline would carry would be particularly difficult to clean up in the event of a spill. 

"Bitumen is very hard to clean up. It sinks. So they say they're going to put world-class standards in place, but the fact is the risk is unacceptable," said Berman on Monday. 

B.C. Union of Indian Chiefs Grand Chief Stewart Phillip said he only got a call about the new criteria minutes before they were announced on Monday.

"It was a very frantic phone call, two minutes trying to articulate the assurance for our aboriginal title and rights interest," said Phillip.

Just last week, Enbridge announced plans to spend up to $500 million to improve Northern Gateway's safety features. But First Nations quickly dismissed the plan, saying they have no trust in Enbridge given the company's poor record when it comes to handling spills.