Canadian Oil Pipeline Approval Called Tainted by Money

VANCOUVER, B.C. (CN) — Approval of an oil pipeline through British Columbia was tainted by Kinder Morgan’s $560,000 in political donations to the province’s governing party, a government watchdog and environmental group claim in court.

Democracy Watch and the Pipe Up Network sued British Columbia and its Ministers of Environment and Natural Gas Development on Tuesday in B.C. Supreme Court, seeking to quash the Jan. 10 approval of the controversial project.

The Trans Mountain pipeline is to snake more than 600 miles from Alberta’s oil sands and carry 590,000 barrels of diluted bitumen per day to a coastal terminal in the Vancouver suburb of Burnaby. Trans Mountain ULC is a subsidiary of Texas-based Kinder Morgan Inc.

The plaintiffs say approvals for the project were “tainted by reasonable apprehension of bias arising from the accretive effect of approximately $560,000 in payments made to the Liberal Party of British Columbia by Kinder Morgan and oil shippers that intend to use the pipeline (‘KMP Shippers’), together with payment to the Premier of British Columbia of an annual salary of approximately $50,000 by the Liberal Party of British Columbia. The Premier was paid more than $300,000 by the Liberal Party during the six-year period that Kinder Morgan and the KMX Shippers paid more than $560,000 to the Liberal Party.’

Canada’s federal government approved the project in November 2016. British Columbia also approved it, with additional conditions.

“Some of Kinder Morgan’s corporate subsidiaries are in Canada but the vast majority of capital flows from Kinder Morgan’s Canadian pipeline operations and moves untaxed to Texas by means of unlimited liability partnerships and other such devices,” the petition states.

The New York Times printed a muckraking story about British Columbia on Jan. 13, under the headline, “The ‘Wild West’ of Political Cash.”

The provincial government defended its approval of the project in an emailed statement to Courthouse News.

“This project was given approval by the Trudeau government last November and attached 157 conditions. Approval was given after a lengthy environmental review process conducted by the federal government. The environmental review process is led by professional staff whose analysis and recommendations are then forwarded to elected officials for decision,” according to the statement from Ministry of Environment spokesman David Karn.

“Separate from any environmental review process, the Province’s clear, consistent and principled position on its five conditions has resulted in tangible and significant investments that will protect British Columbia’s environmental and economic interests.”

The plaintiffs seek, at the very least, judicial review and costs of suit.

In a concluding statement in the lawsuit, they say: “The bottom line is that a reasonable, informed and thoughtful person, after thinking about it for a while, would think that the Premier and the Ministers would have at least been unconsciously affected by more than $560,000 in payments to the Liberal Party of British Columbia. The KMP Approval is tainted by money.”

Democracy Watch and Pipe Up Network are represented by Jason Gratl in Vancouver, who could not be reached for comment after hours on Tuesday.

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