A tanker loads from the terminal of the Trans Mountain oil pipeline in north Burnaby.

Pipeline hearings on hold after appointment

New NEB director worked for Kinder Morgan as a consultant before becoming regulator

Oral hearings that were supposed to begin this week in Burnaby into Kinder Morgan’s oil pipeline expansion plan are on hold in the wake of the appointment of one of the company’s consultants to the National Energy Board.

Steven Kelly was named this summer to a seven-year NEB term, beginning in October.

He won’t sit on the three-member NEB panel considering the proposed Trans Mountain  pipeline twinning, but his appointment has drawn fresh accusations that the process is unfair to project critics.

The NEB has struck the evidence provided by Kelly from the record – citing concerns about the integrity of the process – and Kinder Morgan is having new consultants review and re-file those reports before the NEB lays out a revised schedule for the review.

The City of Burnaby is now arguing that doesn’t go far enough – it says a whole new review panel must be constituted to review the project, effectively rebooting the process.

“Mr. Kelly’s evidence has tainted this entire hearing, and the process must begin again to erase the perception of bias towards Trans Mountain,” wrote Greg McDade, lawyer for the municipality.

The NEB had begun advertising for permanent board members in January, so McDade argues Kelly’s appointment had been in the works for months, with both he and the NEB aware of his application as he continued to work on evidence in support of the project.

“Replacing (Kelly’s) evidence at the eleventh hour in no way legitimizes this hearing process.”

Burnaby is also demanding draft conditions for the project that were released last month be withdrawn and reconsidered.

Kelly’s work had been focused on the economic justification for the new pipeline.

Kinder Morgan estimated the revised evidence will be resubmitted by Sept. 25 and it wants the NEB to expedite the conclusion of the review.

“Obviously restarting the regulatory process is not a viable option for us,” Trans Mountain spokesperson Lisa Clement said.

The $5.4-billion pipeline project would nearly triple Trans Mountain’s capacity and result in a seven-fold increase in tankers carrying oil out through Burrard Inlet.

 

Deal-making on benefits okay, NEB rules

Meanwhile, the NEB has ruled against another intervener that had argued Kinder Morgan should stop offering municipalities and universities lucrative community benefit deals in advance of the hearings.

The group WaterWealth had objected to the offers of benefit agreements – which some critics have called “bribes” to mute criticism at the hearings – arguing they erode trust in the NEB and cast doubt on the evidence of beneficiaries who are also intervenors.

The NEB concluded the agreements or negotiations toward them don’t undermine its credibility and authority, and are consistent with the consultation requirements placed on the company.

Trans Mountain officials had in part argued the NEB had no jurisdiction over the company’s dealings with third parties.

Kinder Morgan struck a deal in June to contribute $300,000 over 20 years to Kwantlen Polytechnic University.

Earlier in the spring, Chilliwack council voted to defer an $800,000 offer for a pedestrian walkway until the project review ends.

Kinder Morgan has benefit deals worth $5 million with 18 municipalities along the pipeline route from Hope to northern Alberta, and has had talks with others, including Abbotsford, Langley Township and Surrey.

All the contribution agreements are subject to approval of the project.

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