Blog: First Nations as pipeline owners

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TC Energy’s offer to 20 First Nations of 10% equity in the Coastal GasLink pipeline brings to mind the drive by a number of nations to take over ownership of the Trans Mountain pipeline system from its current owner: you, the federal taxpayer.

At last count, three First Nations groups were working on Ottawa to let them become majority owners (51%) or, indeed, outright 100% owners, of the oil pipeline system. It runs from Alberta to tidewater at Burnaby, and to U.S. oil refineries in northwest Washington State.

And a fourth Indigenous group says it does not itself want to buy the pipeline but seeks to support Indigenous communities in making the best deal possible.

Prime Minister Trudeau has made it clear his government is open to ownership of the pipeline by Indigenous groups, although how that would be achieved is still unexplained.

Certainly the three groups have expressed serious interest. One says it has already lined up the necessary money, although how and for how much is not clear.

We do know that the latest cost estimate for the TMX expansion of the line, which would be part of any deal, has ballooned from $12.6 billion to $21.4 billion. And work on the expansion is at this point only just over 50% complete.

Thus financing is inevitably a challenge for any First Nation interested in ownership. While the one potential investor says it has arranged for financing, others have not reported on their progress. And we’ve heard that at least one is counting on direct federal financial support to pay for a share of the line.

The key groups:

  • Western Indigenous Pipeline Group (WIPG) has leaders from First Nations communities along the pipeline route. To pursue ownership, it now has formed a partnership, Chinook Pathways, with Pembina Pipeline Corp., Canada’s third-largest pipeline company. (Pembina is also a partner in the Haisla Nation’s proposed Cedar LNG project in BC.)

One of the WIPG leaders is Mike LeBourdais, former chief of the Whispering Pines/Clinton Indian Band in BC. He has been pushing for First Nations ownership of the Trans Mountain pipeline since 2012.

“WIPG is the only Indigenous ownership entity which will distribute equity to, and has the support of, the legal rights and title holders on the Trans Mountain pipeline route.”

  • Natural Law Energy is talking with 129 nations along the Trans Mountain route, and says it has secured an unidentified “world-class operator” for the pipeline. Natural Law Energy also pursued a stake in the Keystone XL pipeline from Alberta to Oklahoma, but that project was killed by President Joe Biden on his first day in office.

“We’re here with an economic hunting licence,” says Travis Meguinis of the Tsuut’ina Nation in Alberta, NLE’s CEO and co-founder.

  • Project Reconciliation says it represents 340 different Indigenous groups in C., Alberta and Saskatchewan, and plans to place 80% of the cash flow from its pipeline stake into a “sovereign wealth fund” to invest in environmentally friendly projects.

It proposes “100% Indigenous Ownership in 100% of Trans Mountain Corporation,” with “no up-front equity requirement by participating Indigenous groups.”

(Project Reconciliation has also absorbed the Alberta-based Iron Coalition  that was formed in 2019 to pursue a share in the pipeline, but dropped out in 2020.)

  • And there is Nesika Services. It introduced itself in January with this: “An Indigenous community-led, not-for-profit looks to acquire ownership of Trans Mountain Pipeline.” But it went on to say: “Nesika does not seek to buy the pipeline but rather to support the communities in negotiating and structuring the best transaction possible.”

And it says: “We are a not-for-profit grassroots organization that’s been formed by Indigenous communities impacted by the Trans Mountain (TMX) pipeline.” The chair is Chief Tony Alexis, of the Alexis Nakota Sioux Nation in Alberta,   who was earlier a director of the Iron Coalition.

Ottawa has engaged a facilitator for continued talks with these Indigenous communities. And, at their request, it will provide an independent financial analysis of Trans Mountain when the project is complete and in service. That now is expected in Q3 of 2023.

The final step in the process will be negotiations between the federal government and the interested First Nations groups.

Anti-pipeline groups like to say First Nations oppose the pipeline. That’s true of some nations, and of noisy protest groups such as the so-called Tiny House Warriors. But of 129 Indigenous communities potentially affected by the Trans Mountain project, 120 either support it or do not oppose it, the Federal Court of Appeal found.

And Trans Mountain notes that well over 1,000 Indigenous people have worked on the pipeline expansion, and more than $1.4 billion has been awarded in Indigenous contracts.

Coastal GasLink, announcing the equity proposal from parent TC Energy, also posted some numbers:

“Since construction began, hundreds of key roles have been held by local Indigenous people, and over $1 billion in contracts have been awarded to local Indigenous businesses on the project. In 2021 alone, we invested over $550,000 in local Indigenous communities to support community initiatives, skills training and education.”

And that does not include the benefits that continue to flow to the 20 Nations along the CGL route whose elected councils are supporting the project.

Hear Chief Justin Napoleon of the Saulteau First Nations: “Having the option to get involved in equity opens up the opportunity to have long-term economic benefit from a project that will be there for years.”

The same is being said by the Indigenous groups seeking ownership in, or of, the Trans Mountain pipeline.

(Posted here 19 April 2022)

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