Coastal GasLink could face million-dollar fines for repeated environmental infractions

Dec. 8, 2021

B.C’s environmental assessment office has issued 11 orders to Coastal GasLink since the project began, including three in November

Jerry cans of gas in an overflowing pool of water. Oil barrels lying on the ground. A dumpster filled to the brim, its lid propped open and bags of garbage left out in bear country. Murky water flowing into wetlands, lakes, streams and rivers. 

These are scenes from the route of the Coastal GasLink pipeline, as documented by provincial inspectors.

All of this, including impacts to watercourses, their beds and banks not properly restored after workers cleared the land in preparation for laying pipe, violates the terms of its project approval — adding to a growing list of 11 non-compliance orders issued by B.C.’s environmental assessment office since construction on the project began in 2019, including three new orders issued in November.

At one site, inspectors found willows were planted to revegetate cleared banks but the willow stakes were too small and planted too shallow, limiting their chance at survival. “The willow stakes had more than 25 centimetres left exposed and the planting rate of one stem per 15 centimetres was often not met,” inspectors stated in a report dated Sept. 23, 2021, that laid out their concerns about environmental infractions along the pipeline’s right-of-way.

The inspectors recommended an administrative penalty, which could mean daily fines of up to $750,000 for every day infractions are not addressed, according to the Ministry of Environment and Climate Change Strategy. In the coming weeks, the ministry will determine whether a penalty is necessary — or if additional information is needed — and then give Coastal GasLink another chance to respond to its findings and any proposed penalty.

“Matters of non-compliance are taken very seriously — as evidenced by the recent orders that included taking the additional step of recommending an administrative penalty for continued non-compliance,” the Ministry of Environment told The Narwhal in an emailed statement.

While Coastal GasLink, owned by TC Energy, largely admitted to errors in responses to the inspections throughout the report, it also disputed whether it needed to do everything outlined by inspectors, arguing that some of it was “optional” and not mandatory.

“As willow staking is an optional mitigation intended to help promote new growth along a reclaimed watercourse bank, Coastal GasLink argues that any use of willow staking (whether it adheres to the typical guidance or not) is more beneficial than no willow staking,” the company said in response to the inspectors’ findings.

The Coastal GasLink pipeline, if completed, would transport 2.1 billion cubic feet of natural gas daily, with capacity to expand to five billion cubic feet per day, from sources in B.C.’s northeast to the LNG Canada facility currently under construction on Haisla territory in Kitimat.

On Nov. 9, nine days before RCMP units began arresting Wet’suwet’en land defenders on Gidimt’en clan territory in northwest B.C., the province’s environmental assessment office issued three more non-compliance orders to Coastal GasLink related to the Sept. 23 report. 

Sleydo’ Molly Wickham, a wing chief of Cas Yikh house and Gidimt’en camp spokesperson, said the company’s history of environmental infractions is a key part of why Gidimt’en members and supporters are committed to preventing the company from drilling under the Wedzin Kwa (Morice) River. 

When the company cleared land in late September, in preparation for drilling and laying pipe under the river, Wickham and supporters occupied the Coastal GasLink drill site. Land defenders, acting under the authority of Dinï ze’ (Chief) Woos of Cas Yikh House, held the location for 50 days before enforcing an eviction order first issued by the Wet’suwet’en hereditary chiefs on Jan. 4, 2020, triggering a chain of events that led to the arrests of more than 30 land defenders, supporters and journalists.

“We have the ability to drink water right out of our river,” Wickham told The Narwhal in an interview days before being arrested. “We cannot afford for Wedzin Kwa to be destroyed.”

Elected chief Maureen Luggi and councillors Karen Ogen and Heather Nooski, of the Wet’suwet’en First Nation, one of five Wet’suwet’en band councils in the 22,000 square kilometre territory, have said that those opposed to the project do not speak for all Wet’suwet’en people.

“We want to make it absolutely clear that the actions of a few members of the Gidimt’en clan who claimed to evict Coastal GasLink and the RCMP from the headwaters of the Morice River (Wedzin Kwa in our language) do not represent the collective views of the clan or of most Wet’suwet’en people,” they wrote in a public statement on Nov. 14. 

The chief and councillors represent about 140 community members, roughly half of whom live on-reserve west of Burns Lake. But it was not immediately clear how project supporters view Coastal GasLink’s environmental infractions.

The Narwhal reached out to the chief and council but did not receive a response prior to publication.

As journalism professor Candis Callison told The Narwhal in September, it’s vital to remember that all communities — Indigenous and non-Indigenous — rarely agree on an issue unanimously. 

“There has to be more spaces for dissent within Indigenous communities,” she said. “In B.C. politics, there’s so much room for dissent within the NDP party, within the BC Liberals. And yet somehow, Indigenous people have to package themselves for mainstream narratives as if there’s no dissent within.”

Inspections of Coastal GasLink flagged pollutants, garbage and ‘project-related’ impacts to watersheds

The November orders followed another issued on Sept. 24, noting the company has been out of compliance since May 7, 2020, for not posting signage to “identify sensitive environmental features to ensure they are protected.”

Chris Parks and Clayton Smith, members of the province’s compliance and enforcement division, also found the company was not meeting its requirements to prevent human-wildlife interactions by properly securing, storing and disposing of attractants — like food — in vehicles and at work camps. The inspectors first flagged the problem in 2019 and noted recent inspections included a work camp on Unist’ot’en territory, where attractants were left “in project vehicles in a manner accessible and being accessed by wildlife.”

They also noted improper storage of gas canisters, oil barrels, diesel generators and drip trays under heavy machinery and fuel tanks, some of which were overflowing with contaminated water.

The company responded that its workforce was diminished due to public health orders related to COVID-19, but inspectors said “at the time of inspection workforce restrictions were no longer in place.”

Officers conducted follow-up inspections in October, one year after the company was found to be inadequately preventing sediment-laden water from entering four wetlands and more than a dozen watercourses, including the Clore River, a tributary of the Skeena River and important habitat for wild salmon and steelhead. The inspectors and Coastal GasLink were again at odds over the findings.

In the report, Coastal GasLink claimed sediment-laden runoff on Wet’suwet’en territory was not a product of work on the pipeline. The company told the province it is “confident that what is identified as sediment being deposited on the lake ice, is in fact natural tannins leaching out of the forest during spring melt. This is a natural process and should not be associated with Coastal GasLink’s [erosion and sediment control] compliance record.” 

Inspectors disagreed.

“No evidence, such as a signed submission by a qualified professional, was provided to verify this assertion,” the report noted. “Similar lakes in the area did not appear to show the same visible amount of sediment-laden runoff transporting into them.”

“On the balance of probabilities, the sediment-laden water observed to reach the lake at this location is project related,” inspectors concluded.

“This has been ongoing for the last couple of years, these violations, and there’s a big question of how the government can allow the company to continue pouring sediment into our local rivers and wetlands, without any real consequences,” Greg Knox, executive director of SkeenaWild Conservation Trust, told The Narwhal in an interview, noting the Clore River is one of the best steelhead rivers in the world.

Knox explained the impacts of sediment — from pipeline construction, logging, road-building and landslides — can be fatal to fish.

“It’s deposited on top of the gravel, which prevents water from flowing under and through the gravel and that’s what brings oxygen to the salmon and steelhead eggs. So you basically suffocate salmon and steelhead.” 

“It can also kill juvenile salmon at high concentrations and impede adults from being able to draw oxygen out of the water,” he added.

For Mike Langegger, a Kitimat resident and employee of Rio Tinto’s local aluminum smelter, whether you are for or against industrial development shouldn’t come into play when considering these infractions — it’s about balance.

“I work in industry, I get it,” he said in an interview. “It’s created a great quality of life for myself, personally, my family, for my peers, it’s good for the community.”

“We’re in the middle of a boom,” he continued, noting the economic boost the LNG Canada facility, under construction in Kitimat and which will be fed by the Coastal GasLink pipeline, has brought to the community. Langegger, an avid hunter and fisher, said while industry brings benefits, he’s concerned about the impacts an influx of industrial development will have on his community. “If you don’t have teeth in your regulations and bylaws, really what do you have? You have these companies that have more money than some countries.”

The Nov. 9 orders gave Coastal GasLink until Nov. 19 to provide confirmation that measures had been implemented to bring the project back into compliance. Natasha Westover, media spokesperson for the pipeline project, told The Narwhal in an emailed statement that the company is cooperating with the environmental assessment office.

“Erosion and sediment control is dynamic and changes constantly,” Westover wrote. “We adapt along the way and are constantly evaluating places along the project that require attention and are working to ensure that erosion and sediment control is managed appropriately.”

“Coastal GasLink continues to cooperate with the [environmental assessment office] and all other appropriate regulatory agencies to meet their requirements, standards, expectations and reviews,” Westover added.

The Ministry of Environment and Climate Change Strategy said the company has provided proof of coming into compliance regarding human-wildlife interactions, and added the enforcement department is continuing to investigate the other infractions.

“Verification of compliance at those sites will require ongoing evaluation and follow-up, including site inspections,” a ministry spokesperson told The Narwhal.

B.C. holds ‘significant enforcement powers’ to prevent further impacts

Knox said he’s not convinced Coastal GasLink will adequately address its environmental infractions, given the company’s history of failing to remedy problems flagged by the environmental assessment office and the province’s history of issuing warnings and orders but not taking further action.

“The question is, whose interests does the province have here?” Knox asked. “Is it the people of B.C. and people in the communities who are impacted by this? Or is it the company’s interests that they’re upholding? Because they’re not acting on these issues — the company continues to get away with these infractions with little or no consequence.”

He added the province’s lack of decisive action is inconsistent with B.C.’s salmon conservation goals.

“The government of B.C. has committed to protecting salmon and steelhead, and to increasing their efforts by developing a B.C. wild salmon strategy and more robust tools to protect salmon habitat. And yet, they continue to allow industry to do whatever they want.”

He explained the Clore River system is already heavily impacted by logging, including road-building, and increasingly prone to landslides as the impacts of climate change bring extreme rainfall events to the region. 

“This added siltation from pipeline construction means that the habitat in that system is being severely degraded,” he said, noting local chinook and steelhead populations are in decline, due to cumulative impacts of industrial development and climate change. 

“The solution to this problem is to enforce the rules,” he continued. “If [Coastal GasLink] isn’t willing to do proper construction that minimizes impacts on salmon habitat and water, then they should be stopped until they can clean up their act.”

“We’ve seen so many environmental infractions through this whole time,” Howihkat Freda Huson, a chief of Unist’ot’en clan, told The Narwhal in October. “They just [get a] slap on the wrist and pay a little penalty. The government makes all the rules and they watered down all the rules.”

Gavin Smith, lawyer with West Coast Environmental Law, told The Narwhal the environmental assessment office has power and authority under the Environmental Assessment Act to ensure infractions are nipped in the bud.

“It could [be] stopping work entirely and stepping in and actually actively overseeing or even, in theory, performing certain measures to ensure that the act is being complied with,” he said in an interview. “But that’s not the path that they’ve chosen.”

“The intention of the act was to have … significant enforcement powers in place that could be used if there’s recurring instances of non-compliance, for example,” he added. “I’m not sure that we’ve seen that borne out in practice.”

Last year, after Unist’ot’en and Gidimt’en clans flagged concerns about wetlands to the environmental assessment office, inspectors discovered the company did not follow its own wetlands management plan and adversely impacted 42 ecologically sensitive areas along the pipeline route and also failed to follow proper procedure to mitigate impacts to whitebark pine, an endangered species in Canada. 

As The Narwhal reported at the time, the province then ordered Coastal GasLink to stop all work within 30 metres of wetlands. To resume construction, the company had to send a qualified professional to conduct surveys and mitigation plans and provide notice to the environmental assessment office.

“Those qualified professionals are contractors or consultants that are being hired by Coastal GasLink,” Smith said. He noted the problematic nature of “having that lack of a degree of separation between someone who’s got power to essentially restart your project, who also happens to be on your payroll.”

Economic fate of Coastal GasLink pipeline and LNG Canada intertwined

Provincial fines issued to Coastal GasLink, which could escalate to include court-imposed penalties of up to $1,000,000 for a first conviction and up to $2,000,000 for subsequent convictions should they fail to make amends, would put the company’s relations with the Kitimat gas liquefaction facility on shakier ground. 

LNG Canada is a partnership between Shell Canada, Petronas, PetroChina, Mitsubishi and Korea Gas. This summer, a dispute was made public between LNG Canada and Coastal GasLink over increasing costs and delays on the pipeline project — and who would ultimately be responsible for these cost overruns. Coastal GasLink was initially estimated to cost around $4 billion to build in 2012, but by 2019, estimates had grown to $6.6 billion. A more recent price tag for the pipeline has not been made public, but TC Energy stated in its Oct. 29, 2021 quarterly shareholder report that it expects “project costs to increase significantly.”

In order to continue construction on the pipeline this fall, Coastal GasLink borrowed $840 million from TC Energy, which it repaid in October, and then borrowed additional amounts adding up to $175 million that was still owed as of the quarterly report. TC Energy has committed an additional $3.3 billion short-term loan to support the project, should it become necessary. 

Cost overruns on Coastal GasLink could eventually fall on gas shippers through increased pipeline tolls that would mean less profit for all of the oil and gas companies involved — several of which are backing LNG Canada. And any delay to the pipeline’s completion is a delay to production, and revenue generation, at LNG Canada. 

The economic viability of the two projects is also linked to government support. Both Coastal GasLink and LNG Canada are benefiting from significant government subsidies and tax breaks to support construction. In 2020, the Coastal GasLink project received a loan worth up to $500 million from Export Development Canada, a federal agency, and in 2019, LNG Canada added a $275 million direct investment from the federal government to a long list of exemptions and financial breaks from the province.

“Oil and gas is not sustainable,” Wet’suwet’en hereditary Dinï ze’ (Chief) Dsta’hyl Adam Gagnon told The Narwhal in an interview. Dsta’hyl, chief of Lihkt’samisyu clan, condemned the Nov. 18 and 19 arrests and said he considers continued government support of the projects deplorable.  

“The Crown is sponsoring terrorism on the Wet’suwet’en and all First Nations across Canada. The provincial government, the federal government are 100 per cent unilaterally supporting terrorism [and] they’re not just supporting it, they’re financing it. They’re pushing industry ahead to steamroll right over all Indigenous groups.”

In late 2019, the United Nations Committee on the Elimination of Racial Discrimination called on Canada to immediately halt construction of the pipeline and withdraw RCMP and security forces from Wet’suwet’en territory, noting it was disturbed by the “disproportionate use of force, harassment and intimidation by law enforcement officials against Indigenous peoples who peacefully oppose large-scale development projects on their traditional territories.”  

“They have a lot to gain because they’re going to collect tax off of it and they’re subsidizing it at the same time to make sure it happens,” Huson said. She added while it’s true many locals are employed by the projects, especially during construction, those jobs are short-lived. The pipeline, if completed on schedule, will be ready in 2023.

“Boom and bust, I call it,” she said. “They’re all going to make money real quick. And then after, they’re going to have no job. And how long is that money going to last?”

“I have a strong feeling that everything is going to collapse, and they’re not gonna finish that project.”

“We were taught by our grandma and our parents that we had to take care of the land in order for it to take care of ourselves, and always taught that you don’t just take, take, take,” Huson said. “You only take what you need.”

“This is the headwaters, why we’re fighting so hard.”

​​Editor’s note: Candis Callison is a member of The Narwhal’s board of directors. As per The Narwhal’s editorial independence policy, our news judgments are made independently of our board of directors, who are not involved in day-to-day news operations.

[Top photo: A worker stands on a newly cut access road for the Coastal GasLink pipeline near Houston, B.C., in 2019. Since then, the company has faced 11 non-compliance orders from the environmental assessment office for contravening its operating permit. Photo: Amber Bracken / The Narwhal]