Hip hip hooray, Alberta, construction on the Trans Mountain pipeline expansion is finally set to restart.
On second thought, hold the big parade. There’s already plenty of cheerleading going on before substantive progress has been made.
In an event Wednesday at a pipeline contractor in Sherwood Park, Natural Resources Minister Amarjeet Sohi touted the news Trans Mountain Corp. has begun moving forward on construction to expand the federally owned pipeline.
The news conference was one part update and 10 parts politics. It came two months after Ottawa re-approved the stalled development, which is expected to nearly triple the amount of oil shipped from the Edmonton area to Burnaby, B.C.
The federal Crown corporation announced it has issued a notice-to-proceed directive to some of its construction contractors on the project, a key step that will eventually see the workforce swell from 650 today to about 4,200 by the fourth quarter.
Some work will begin immediately at the Burnaby Terminal and Westridge Marine Terminal in B.C., and then along the pipeline’s right-of-way.
Aside from the jobs, the most important news was the expanded pipeline should begin operating by the middle of 2022, if all outstanding regulatory approvals are received, as expected.
That’s fully three years away for a project that formally began with a regulatory application in 2013, and was initially expected to be in operation by this December.
“It’s a good day, come on, guys, smile,” Sohi exhorted at the start of his address. “We are very happy that people will be actually in the field, digging the ground and installing the pipe…
“I am very confident that the anticipated date for construction of mid-2022 will be met.”
But confidence is a funny thing. It was a little more than a year ago that such confidence backfired politically.
Last July, Sohi and then-premier Rachel Notley were part of a photo opportunity at the Enoch Cree Nation, donning shovels and hard hats to demonstrate progress was being made on the embattled project.
In an interview last August, Sohi felt assured the project — a development the federal government acquired from Kinder Morgan for $4.5 billion — would withstand a pending legal challenge from opponents.
“We are very confident that we have done extensive consultation,” he said at the time. “I think that puts us in a very strong position.”
Less than two days later, the federal Court of Appeal quashed the permit for Trans Mountain, in part because of inadequate consultation by Ottawa with affected Indigenous communities.
The point here is that feel-good events in the middle of an election cycle are more about symbolism — “Look everybody, headway is being made right before your very eyes” — than reality.
When it comes to building pipelines, nothing is simple.
Now, don’t get me wrong. It’s great news that hiring and construction work are set to begin, but it’s also way too soon to assume the project is bulletproof.
Trans Mountain still has to withstand other legal challenges of the government’s re-approval, while the prospect of civil disobedience by opponents in British Columbia looms.
“We have had subsequent governments over the last eight years say this project is going to move forward and giving new timelines, and it’s never met any of them,” said Greenpeace Canada’s Mike Hudema.
“This project still faces a litany of lawsuits, it still faces a mounting force on the ground.”
The province and the oil industry aren’t quite ready to hold a party, either.
“Nobody is popping champagne corks at this time. When the pipeline is complete, then there will be reason for celebration,” said Gary Mar, CEO of the Petroleum Services Association of Canada.
After watching the demise of the Energy East and Northern Gateway initiatives, and the ongoing delays affecting the three other projects, it’s only natural supporters are reluctant to get too exuberant.
“At the end of the day, it doesn’t hurt to be optimistic, (but) we have had our fair share of setbacks,” said Mark Scholz, president of the Canadian Association of Oilwell Drilling Contractors.
For many in the sector, the real question is whether the Trudeau government has the mettle to deal with opponents marching in the streets of Vancouver.
Construction is starting up in the middle of a federal election campaign. Every twist and turn will be politically charged and under an intense spotlight.
“The federal and local authorities must ensure the rule of law is enforced and that construction is not illegally blocked,” Premier Jason Kenney said in a statement.
Wednesday’s announcement also came just a day after the sobering news the Alberta government will extend its oil curtailment program into 2020 — instead of winding it down by the end of December — due to a lack of pipeline capacity.
Mark Oberstoetter of energy consultancy Wood Mackenzie believes it’s significant Trans Mountain work is starting in the summer, noting construction is estimated to take around 30 to 34 months.
“My issue with TMX is what do they do about protests?” he said. “It’s not so much can you get a shovel in the ground, but do you have line of sight towards actually completing that?”
All the skepticism is well earned, although it shouldn’t overshadow the fact people are about to be hired and bulldozers are set to start moving.
It’s a far sight better than being stuck in legal limbo.
But the reality is the Trans Mountain expansion still has a long way to go before oil starts flowing, and the machinery to make that happen is only beginning to shift back into gear.
Let’s put off the celebratory parade for another day.