Majority in B.C. Want Harper to Delay or Kill Gateway

A majority of British Columbians want Prime Minister Stephen Harper to reject or delay Enbridge Inc. (ENB)’s Northern Gateway pipeline amid concern the project could lead to oil spills, a Bloomberg-Nanos poll shows.

Thirty-four percent of respondents want the Canadian government to block the C$6.5 billion ($6 billion) project, which would ship crude from Alberta’s oil sands to the B.C. coast for export to Asia, and 33 percent want it delayed for further review. Twenty-nine percent say they want it approved, according to the poll.

With two weeks to go before the deadline for a government decision on Gateway, the poll shows environmentalists and aboriginal groups have more credibility on the project than Enbridge and the Harper government, making it harder for pipeline proponents to win support in Canada’s westernmost province.

“It’s a no-go politically if environmental and aboriginal groups have concerns,” said Nik Nanos, chairman of Nanos Research Group. “The data shows there needs to be a B.C. solution, not one that’s imposed from outside.”

While crude producers say pipelines such as Northern Gateway and TransCanada Corp.’s Keystone XL would ease transportation bottlenecks that have depressed the price of Canadian heavy oil, efforts to build energy infrastructure have run into opposition both at home and in the U.S.

President Barack Obama said in April he was delaying a decision on the Keystone project because of a court battle in Nebraska, extending a review that is now in its sixth year.

Threatening Lawsuits

Aboriginal groups in Canada are threatening lawsuits and protests to stop Gateway if it gets approval. Harper’s cabinet has until June 17 to decide on the project. Canada is home to the world’s third largest crude reserves, much of it buried in the oil sands of northern Alberta.

B.C. Premier Christy Clark has said her government will only back the pipeline if it satisfies five conditions: successful completion of an environmental review, “world-leading” oil-spill response systems on water and land, adequate involvement of aboriginal groups and the allocation of a “fair share” of the fiscal and economic benefits to B.C. A regulatory panel recommended approval in December, subject to 209 conditions.

While Clark’s government has more credibility than Harper’s on the pipeline issue, both trail environmentalists and aboriginals, the Bloomberg-Nanos poll found.

‘Building Confidence’

Environmental groups are seen by 75 percent of respondents as credible or somewhat credible, while aboriginal leaders are viewed as such by 71 percent. The B.C. government has a rating of 52 percent, followed by Enbridge at 49 percent and Harper’s government at 46 percent, the data show.

Enbridge “remains focused on building confidence in the project,” company spokesman Todd Nogier said in an e-mail. “We have more work to do and are committed to it.”

Janet Holder, who heads up the company’s efforts to build support for the pipeline, has been traveling around British Columbia and listening to people’s views, Nogier said. Holder has “made good progress in building confidence,” he added.

Harper’s office referred questions to Natural Resources Minister Greg Rickford. “The federal government is reviewing the independent regulator’s recommendation,” Rickford said in an e-mailed statement. “Our government has been clear that proposals cannot proceed unless they are safe for Canadians and safe for the environment.”

‘Self-Interested Public’

The poll also shows fears of an oil spill are top of mind. Thirty-six percent of respondents said the idea that the pipeline might lead to a spill best represented their view. Next was the perspective that the project will create jobs in the province, at 25 percent. Only 15 percent said the idea that the pipeline will contribute to climate change best represented their viewpoint.

The results suggest global warming isn’t “really a factor at this time,” said Nanos, who also serves as a global fellow at the Woodrow Wilson International Center for Scholars. “This is a very self-interested public: What does it mean for the environmental risks and jobs?” he said. “This project isn’t dead yet. There’s still an opportunity to turn this around for pipeline proponents.”

The telephone survey of 500 British Columbians was conducted May 27 to May 31, contacting both land lines and mobile phones. Based on the sample size, the poll is considered accurate 19 times out of 20, with a margin of error of 4.4 percentage points.

Local Opinion

Harper’s government has taken into account local public opinion in the past on major resource-related decisions, including his rejection of the takeover of Canada’s largest potash producer and more recently his move to slow investment by state-owned enterprises in the nation’s oil sands.

His decision in 2012 to keep state-owned firms from taking control of oil sands businesses was consistent with polling at the time that found Albertans opposed to full Chinese ownership and more favorable to minority holdings.

With 4.6 million people, B.C. ranks third in population behind Ontario and Quebec and is home to the most protected parkland of any of the nation’s 13 provinces or territories. The province’s unemployment rate of 5.8 percent compares with a national level of 6.9 percent.

The federal government has recently taken steps to meet B.C.’s conditions, while cautioning that the moves aren’t aimed at helping any particular project.

The government said last month it will increase the liability of pipeline operators for spills, and draw up safety plans to deal with offshore spills in four areas, including southern B.C.

Lost Support

Harper has lost support by signaling he would support the project before starting meaningful consultations in British Columbia, said Megan Leslie, a New Democratic Party lawmaker.

“How are people supposed to believe in the project when they feel that government doesn’t care about what they have to say?” she said today in an interview in Ottawa. “The fix has been in for this process since the beginning.”

Natural Resources Minister Greg Rickford said last month his department would open a branch office in Vancouver to step up talks with aboriginal groups, some of whom say the government has failed its constitutional obligation to consult them. The pipeline would cross territory claimed by aboriginal groups, and many have raised concern about the risk of spills.

Thirty-six percent of respondents said aboriginals have the right amount of influence over Northern Gateway’s approval, while 35 percent think they deserve more influence and 22 percent think they should have less, according to the poll.

Kitimat Plebiscite

A majority of residents in Kitimat, a port town of 9,000 people that would be the pipeline’s terminus, opposed the pipeline in a non-binding plebiscite in April. The town’s council later voted to formally oppose the project.

Threats by opponents to block or delay the pipeline haven’t hindered Enbridge’s share performance. The company’s stock has gained 13 percent this year, compared with a 9.6 percent average among oil and natural gas pipeline companies across North America, according to figures compiled by Bloomberg.

Many analysts following the company, including Robert Kwan at RBC Capital Markets in Vancouver, don’t factor Gateway into their price targets for the stock given it’s years away from being built. After the National Energy Board recommended the Canadian government approve the line in December, Kwan said in a note to clients that Gateway has a “long road ahead,” and Enbridge faces hurdles in garnering support from the B.C. government and aboriginals.

“We continue to believe that any future delays and/or negative developments should not have a material impact on the share price,” Kwan said.

To contact the reporters on this story: Theophilos Argitis in Ottawa at targitis@bloomberg.net; Andrew Mayeda in Ottawa at amayeda@bloomberg.net

To contact the editors responsible for this story: David Scanlan at dscanlan@bloomberg.net Paul Badertscher, Chris Fournier