By Julie Green -- Impatient with the time it was taking the Joint Review Panel to issue its report on the Mackenzie Gas Project, Permafrost Media, an online oil-and-gas industry newsletter, issued its own report in January. It took the author, Tom Detlor, a month to write the 13-page report, and that included time off for Christmas. “This is not a joke, but a demonstration of how this job should have been responsibly addressed by the JRP,” wrote Permafrost Media’s publishers, Tom Zubko and Paul Komaromi. The pair, both lifetime residents of Inuvik, Northwest Territories, claimed that everything necessary to know about the proposed pipeline had been uncovered in a plethora of studies going back three decades.
Detlor efficiently dispatched hundreds of recommendations made to the JRP after almost two years of hearings as outside of its mandate, or covered them off in some other way. He concluded the MGP “is not likely to cause significant adverse affects,” whether to the environment, fish, animals, people or traditional land use. Further, he said the worst-case scenario was not building the pipeline at all: “The lost opportunity costs and the increased social-human cost as a result of a “No Project” decision far exceed the costs of the impacts of the project.”
The report was a gift to supporters of the MGP, furious that an 18-month process is now in its fifth year, and frustrated with their inability to do anything about it. Those who tied their future to construction of the largest industrial project ever contemplated North of Sixty would show the JRP how to get the job done. Even people who oppose the deal, or who are ambivalent about it, wonder how the review of a project widely considered to be a done deal became such a dog’s breakfast.
An even more important question for pipeline supporters is whether the lengthy delay in the environmental assessment will kill the deal. While the JRP has plodded through its review – still writing when the project’s lead proponent, Imperial Oil, had originally predicted natural gas would be flowing – construction costs have soared, financing is harder to get, and there’s now a glut of natural gas on world markets. If Imperial Oil ultimately decides not to build it, those pipeline supporters are going to blame the JRP, even though blame for the elastic deadline can be shared by almost everyone who has had a hand in the review.
It’s hard to imagine now, but when discussion turned to building a pipeline down the Mackenzie Valley 10 years ago, there was more than enough optimism to go around. This time the six trillion cubic feet of natural gas reserves in the Mackenzie Delta would make it to market. The land claims that were an issue during the three-year inquiry (1974-1977) led by Justice Thomas Berger had been settled along 60 per cent of the pipeline route. In fact, aboriginal people might even become one-third owners of the 1,220-kilometre pipeline through the Aboriginal Pipeline Group.
But settled land claims didn’t only create certainty for aboriginal people; they created a plethora of environmental assessment and regulatory boards. That was in addition to the federal boards that have jurisdiction in the North regarding resource extraction, such as the National Energy Board.
In an attempt to simplify this complicated operating environment, 14 boards and agencies came together to create the Co-operation Plan for the Environmental Impact Assessment and Regulatory Review of a Northern Gas Pipeline Project through the Northwest Territories. They published the co-operation plan in June 2002. But for all its noble intentions, the plan had a significant flaw. “That’s where good planning didn’t help as much as it could have, because there was no way of binding the parties to that document,” says Ricki Hurst, who helped negotiate the plan on behalf of Indian and Northern Affairs Canada. He left the federal government in November 2006, and now works as a consultant in Yellowknife.
The plan didn’t produce as much co-operation as Kevin O’Reilly would have liked to see. He reviewed the plan for the Canadian Arctic Resources Committee (CARC) before leaving for a new job four years ago. There were still two sets of hearings and two public registries of documents, one for the National Energy Board (reviewing the engineering and economic aspects of the project) and the other for the JRP (conducting the environmental assessment). “The separate processes put extra demands on everyone in preparation and time – and it’s a root cause for why this report is taking so long,” he says.
The plan alloted the JRP a total of 18 months for its work. That was divided into four months to evaluate the proponents’ environmental impact statement (EIS), 10 months for hearings and report writing, and four months to work with the federal government on its response to that report. If the panel had been able to stick to that schedule, the report would have been delivered in March 2006. “We knew that it was relatively ambitious but it was something we thought was do-able at that time,” Hurst says. So how did 18 months turn into five years? As usual, there’s lot of blame to go around, starting with the makeup of the panel.
The three authorities responsible for environmental assessment in the NWT – the Inuvialuit Game Council, representing the indigenous people of the NWT’s Far North, the Mackenzie Valley Environmental Impact Review Board, representing aboriginal people along the river valley, and the Canadian Environmental Assessment Agency, responsible for reviews everywhere else in Canada – created the Joint Review Panel in the summer of 2004.
“It’s always a challenge to select a panel,” says Todd Burlingame, chair of the MVEIRB at the time. “There are lots of interests at play, and politics. Even the health of the proposed members.” But a thorough search produced a list of seven appointments for then-environment-minister Stéphane Dion to make in August 2004. He endorsed fisheries officer Tyson Pertschy and Berger-era alumni Peter Usher on the recommendation of the Inuvialuit. He appointed Inuvik’s Barry Greenland, community activist Gina Dolphus and Percy Hardisty for MVEIRB. Dion rounded out the appointments with his own choices, Rowland Harrison of the NEB and veteran consultant Robert Hornal. Their initial appointments were for two years. T he panel then hired a staff of six, including a panel manager with no previous administrative experience.
Most people are reluctant to criticize the composition of the panel as a reason for the delay. “It’s clear they have huge differences in background,” says Kevin O’Reilly. Burlingame says that was part of the plan, an attempt to bring traditional knowledge together with western science. Some complain that Peter Usher, who asked most of the questions on the panel’s behalf, spent hours leading his colleagues down blind alleys. O’Reilly disagrees. “His experience and his curiosity produced questions that bore fruit,” he says.
"The EIS was a concept, not a proposal, hovering at 60,000 feet rather than 30,000 feet.” Marc Lange, senior biologist, DFO The panel had been on the job for just two months when Imperial Oil filed its applications, on behalf of partners Shell Canada, ConocoPhillips, ExxonMobil Canada and the Aboriginal Pipeline Group, to build the Mackenzie Gas Project, then estimated to cost $7-billion. The last cost estimate, made in 2006, pegs it at $16.2-billion. The application included a gathering system that would tie the gas fields together in the Beaufort Delta, a liquids line that would connect to the Enbridge oil pipeline at the town of Norman Wells, and a 30-inch line to move natural gas from Inuvik to a connection point in northwestern Alberta. The proponents also submitted their 6,500-page EIS for the project. It concluded that the development would have no lasting impact on the Mackenzie Valley, an extraordinary conclusion given the scope of the project.
The panel’s first task was to determine whether there was enough information in the EIS. A 21-page letter to Imperial Oil, sent in December 2004, detailed gaps in almost every section. The same kind of exercise by a joint committee of federal and territorial government departments produced a similar result: pages of questions about both the results and methodology.
“The EIS was missing quite a bit,” says Hurst, the former DIAND official. The paucity of information worried federal departments with mandates to protect the environment, such as Environment Canada. “There were many times that people said ‘I don’t have enough information to say there won’t be any impact here,’” Hurst says. The gaps “caused a lot of back of forth, and I think it’s fair to say that it protracted the process.” Imperial Oil has repeatedly said it stands by the quality of its EIS.
"They were hired to do a job, and they should have worked nights and weekends to get the job done in a timely manner. There’s no sense of urgency.” Bob Reid, president, Aboriginal Pipeline Group A senior biologist who reviewed the EIS for the Department of Fisheries and Oceans confirms the study lacked the detail he required. “The EIS was a concept, not a proposal, hovering at 60,000 feet rather than 30,000 feet,” says Marc Lange. “The time it’s taking the panel to finish its report in part reflects the quality of the information that was given to them,” says a senior government official who didn’t want to be named. “The proponents can’t substantiate their conclusion of no significant impact.”
Imperial Oil apparently had second thoughts about the project, and put both engineering and regulatory work on hold in April 2005. Part of the problem was the volume of information requests sent to the proponents for answers. Then-president Mike Yeager wondered aloud how long it would take proponents to get all their permits, and warned the company would re-evaluate before committing to public hearings. But the company eventually made that commitment in November 2005. The co-operation plan had allotted four months to evaluate the applications and supporting documents. In reality, the process, thanks largely to Imperial Oil’s incomplete EIS, had eaten up more than a year.
Public hearings finally began on Valentine’s Day 2006 in Inuvik, kicking off nine months of community and technical hearings, with the panel sitting an average of eight days a month, right through the summer. It didn’t take long for someone to tell the panel what many people were saying privately, that the pipeline was a done deal and the review was a sham. “It’s useless to say anything because it sounds like it’s already planned to go ahead,” said Hyacinth Kochon in Colville Lake. Chairman Robert Hornal responded that he wasn’t there to give the MGP a rubber stamp. And then, as if to support his point, the hearing schedule
got longer and longer.
When the Dene Tha’ First Nation in northern Alberta successfully argued in front of the Federal Court they had been wrongly left out of the environmental assessment process, the panel was forced to take a break. By the time the stay of proceedings had been lifted three months later, the hearings had slipped further behind. In March 2007, the schedule was adjusted again to extend the hearings into June, always putting the end out of sight just as it came into view. Finally, in July, closing arguments were scheduled for the end of November. The longer the hearings went on, the fewer days the panel sat. There were a couple of months when the panel didn’t sit at all. Peter Usher commuted to work from England for most of 2007.
“The reason they went an extra year in hearings is because there were huge gaps between hearings,” says Bob Reid, president of the Aboriginal Pipeline Group, who has spent more than 40 years in the pipeline business. “They were hired to do a job, and they should have worked nights and weekends to get the job done in a timely manner,” he says. “There’s no sense of urgency.”
“It’s complex and it’s being run by amateurs,” says a senior official at a land-claims organization who doesn’t want to be named. The Canadian Environmental Assessment Agency “hasn’t taken a big enough role” as the ultimate authority for the panel, he says. The time to rein the panel in was when it first extended its hearing schedule in July 2006. “Now we’re so far down the road, there’s not much they can do.”
But O’Reilly, representing the Yellowknife social-justice group Alternatives North, believes the panel was just doing its job by scheduling more hearings. It was the only way they had to get the information they needed. He believes their job was difficult, even after multiple rounds of information requests, because many government experts gave short presentations that didn’t fully grapple with – or reconcile - the problems presented by the evidence.
Then there was the issue of funding. The panel had some in-house help in the form of half a dozen experts for issues such as soil mechanics and permafrost. But CEAA controlled the purse strings, and it limited spending by the panel to $25,000 at a time for expert help in reviewing submissions. As a result, it was difficult for the panel to retain experts for any length of time. O’Reilly believes the JRP needed more help but found it difficult to get the money.
Many people assumed that since the panel was only sitting five days a month in the last half of 2007, they were busy compiling evidence and writing their report. But that doesn’t seem to be the case, whether because of a lack of resources or a lack of planning. “They could have and should have brought it together during the hearings,” says the senior official in the land claims organization. The JRP’s spokesperson won’t say when the writing began. But Hurst says one of the lessons learned is “there’s value in summarizing the information as it comes in, and to have sufficient support and resources within the panel who could be writing a draft report as the hearings go on.” That’s how other panels do it, according to the APG ’s Bob Reid. In any case, a great cone of silence settled on the panel.
In November 2008, a year after hearings ended, apparently starved for information, two of the three agencies responsible for the panel wanted a specific delivery date for the report. “At this late stage in the environmental impact review process, the panel should be able to estimate a completion date for its final report with some confidence,” said the letter from the Inuvialuit Game Council and the Mackenzie Valley Environmental Impact Review Board.
The JRP responded with a news release in which Hornal attempted to reassure the impatient public. The panel would deliver its report in December 2009. “The panel members are working full-time with our staff to complete the report in an efficient, yet comprehensive and responsible manner, considering the enormous amount of information submitted.” P anel costs, which started at almost $7-million in 2004, will be close to $19-million by the end of this year.
There was no explanation about why the extra year was needed. The new deadline didn’t please the federal minister of the environment, Jim Prentice, who had been quoted just days earlier saying he expected the report in the spring. Nor were the IGC or the MVEIRB any happier. “The revised completion date of December 2009 is not acceptable,” they fired back. The boards wanted to see the panel release its report in two stages, a decision by the end of March, and reasons by summer. All the parties met in February to discuss the deadline, but no change in schedule has been announced.
Todd Burlingame, now an oil and gas consultant in St. John’s, Nfld, believes the game council and the review board took the unusual step of writing because they are concerned about the reputation of the Northern regulatory system, already under fire from developers and the federal government. He says the JRP is a topic of conversation in environmental assessment circles across the country, and kind words are hard to find. “It’s a black eye for environmental assessments,” he says of the time it’s taking to write the report. And Burlingame has a prediction: “It won’t be allowed to happen again.”
Minister Prentice has since hinted panels will be given firm deadlines in the future, and they’ll be held to them. In mid-March he told a Calgary business audience he was seeking legal advice on how to ensure the panel delivers by its new deadline. But whether he replaces the chairman, appoints a new panel or declares the process finished, he might not save much time when the inevitable legal challenges to the pipeline decision are taken into account.
Where does independence end and accountability begin? The panel is designed to be independent, and has to be in order to do a credible job. CEAA provides administrative oversight, including reviewing the panel’s budget and reporting on costs to the proponents, who will end up paying twothirds of the total. MVEIRB will pay the rest. “There needs to be more attention on time and effectiveness, rather than fettering their decision-making power,” says Hurst, the former DIAN D official. Burlingame points to a lack of leadership and confidence among the panel.
Kevin O’Reilly is sympathetic, saying the panel should take its time to write a thorough report. He believes it would be hard to ask the panel to account for the extra time and money it’s spending without edging into political interference. He says the Permafrost Media report triggered a piling on of criticism by “people who are resentful the done deal fell apart, and they’re looking for someone to blame.” The report itself was “nothing more or less than an attempt to put some additional political pressure on the Joint Review Panel to try and get this project approved,” O’Reilly says.
The proof of the pudding, as they say, is in the eating. And the onus is now on the JRP not only to stick to its self-imposed December 2009 deadline, but also to produce a report worth waiting for.
