Energy assessment law needed to avoid another Trans Mountain impasse, PM says

Prime Minister Justin Trudeau says he is overhauling how Canada assesses big energy projects in a bid to ensure new projects can get built without the government having to buy them to make that happen.

"We're going to work to make sure that we're creating a system where you don't have to pass a law to get a pipeline built, you don't have to buy an energy project in order to de-risk it," Trudeau said in a recent interview with The Canadian Press.

"We want an energy sector where the private sector has confidence in getting our resources to markets."

The government's $4.5 billion purchase of the Trans Mountain pipeline was one of the biggest and possibly most unexpected political manoeuvres the Liberals made in 2018.

The government bought it from Kinder Morgan at the end of the summer after political opposition to expanding the pipeline gave the company and its investors cold feet.

• Ottawa to announce $1.6B for battered energy sector
• Western oil price rally unlikely to last after curtailments begin: expert panel

Trans Mountain hit a major snag in August when the Federal Court of Appeal tore up federal approval for the expansion citing insufficient environment and Indigenous consultations.

The government is trying to get it back on track by redoing parts of those consultations to do what the court said was lacking.

Trudeau believes his government's Impact Assessment Act will fix a flawed review process that created the uncertainty around Trans Mountain. Bill C-69 is one of the last big pieces of legislation the government wants passed before the next election and potentially is in for a very rough ride.

• 6 things to know about Canada's oil-price gap, from gluts to the differential
• Notley's frustration over pipeline inertia leads to idea to purchase hundreds of rail cars

The bill sets in place new timelines and parameters for reviews, lifts limits set by the previous Conservatives on who can participate in the process, and creates an early-phase consultation with Indigenous communities and anyone else impacted by the project to identify concerns.

Trudeau said is open to amendments if it makes the bill better, but added he won't agree to dropping the legislation entirely. He said not passing the legislation is not an option if Canadians want to see their resources developed.

"No matter how much we're investing in the knowledge economy and education, Canada will always have a core of natural resources as an important part of our economy," he said.

• Notley says Alberta will buy rail cars to move oil, wants Ottawa to chip in
• Stop with the sympathy and take action, Notley urges Ottawa on oil prices

A Senate committee is scheduled to start hearings on C-69 at the end of January, but the bill faces stiff opposition from Conservative senators spurred by an angry oil industry and the Alberta government.

Conservative natural resources critic Shannon Stubbs said if the law is approved, there won't be any new energy projects like pipelines approved in Canada because no investor would believe it could withstand the tests required under C-69.

Stubbs said she thinks the bill needs to be scrapped altogether, or at the very least remove the discretion for the government to put the proposed two-year review process on hold.

She also wants the government to rework the bill so that environmental assessments only contemplate greenhouse gas emissions produced by the pipeline itself and not those produced by the refining process.

The bill does not specifically require upstream emissions be looked at. Rather, the legislation says the project has to be considered in terms of its impact on Canada meeting its greenhouse gas reduction targets.