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B.C.’s political intrigue may be trouble for Notley on pipeline front

The imbroglio could affect Ms. Notley’s plans, as it may bolster the chances of NDP Leader John Horgan, who opposes the export pipeline.


Rachel Notley could soon face a family squabble, and it has big implications on the energy front.

The Alberta Premier is already an outlier on various New Democratic Party policy positions. It's now possible she could find herself at odds with a provincial government next door on a key economic prospect for her province – an export pipeline. That is if British Columbia is run by her NDP counterpart after the election in May.

Mounting controversy over questionable fundraising practices that have fattened the coffers of Premier Christy Clark's B.C. Liberals threatens to turn the electorate against her, not long after she dropped her opposition to an oil line to the Pacific Coast.

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A Globe and Mail investigation last weekend showed lobbyists and other power brokers have funnelled money to the ruling party on behalf of corporate and special interests to gain access to political inner circles. Elections BC has launched an investigation into the practices.

It is not known how it all might affect Ms. Clark's re-election hopes in May, but it sure is keeping Albertans interested.

The imbroglio could bolster the chances of NDP Leader John Horgan, who opposes Kinder Morgan Inc.'s $6.8-billion Trans Mountain pipeline expansion, and the much busier tanker traffic it would bring to Vancouver's harbour. He and Ms. Notley met late last year, and Mr. Horgan was not swayed by Alberta's pipeline pitch.

Ms. Notley found after taking power in 2015 that she is duty bound to find common ground with the energy sector, a major employer, contributor to public accounts and, as it happens, an industry really down on its luck due to the collapse in crude prices.

Since then, she has become a champion of expanding market access for her province's oil, and the Kinder Morgan project is the most realistic hope for reducing dependence on the United States as virtually its sole customer.

If environmentalists decry oil sands development and its impact on global warming, the Alberta NDP can point to the politically risky step it took in establishing a carbon-reduction plan with tough measures such as a carbon tax, cap on oil sands emissions and a schedule for ending coal-fired power.

Indeed, Ms. Notley told that story to potential investors at a high-profile gathering of global energy potentates and brass in Houston this week. The trip came on the heels of a visit to Donald Trump's Washington, where she impressed upon anyone who would listen the importance of maintaining tight trade ties, in energy and other sectors key to the Alberta economy.

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This is the reality of running a government and being the servant of even those who didn't vote for you. Certainly, the biggest display of her philosophical split from many of her NDP compatriots came last spring, when a faction of the federal party called for a ban on any new pipelines. The Premier blasted the proposal as "naive," ill-informed" and "tone-deaf."

Now, an anti-pipeline government could emerge to the west. The Kinder Morgan project has the federal regulatory clearances necessary to go ahead after Prime Minister Justin Trudeau's government gave its blessing last fall. But there are legal challenges being attempted and there's no betting against some unforeseen roadblock complicating matters before trenching begins.

One court action charges that B.C.'s environmental assessment certificate for the Kinder Morgan project is tainted by political donations to the Liberals by oil-industry interests.

It took Ms. Clark years to drop her opposition to a pipeline to rich markets in Asia and, when she did, it was after striking a deal with Kinder Morgan that could be worth up to $1-billion in payments to the B.C. government over the next 20 years.

It would be foolish to count her out of the race so early – indeed, her pro-jobs platform made her the Comeback Kid in the most recent election in 2013.

If she can't repeat the performance, though, Ms. Notley will have to find a way to work with a political relative on a very touchy subject where there isn't common ground right now.

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Given the importance of the file to both sides, some family talks in the background have surely begun.

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About the Author
Mergers and Acquisitions Reporter

Jeffrey Jones is a veteran journalist specializing in mergers, acquisitions and private equity for The Globe and Mail’s Report on Business. Before joining The Globe and Mail in 2013, he was a senior reporter for Reuters, writing news, features and analysis on energy deals, pipelines, politics and general topics. More


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