Friday, 08 July 2016 08:22

BC Shipping News Op-ed

Mixed (moratorium) messages by By Robert Lewis-Manning, Chamber of Shipping of British Columbia

By BCShippingNews
July 8 2016
Robert Lewis-Manning, Chamber of Shipping of British Columbia

Op-ed piece highlights risks of tanker moratorium...

It is now well-known that the Federal Government intends to formalize a moratorium on the shipment of crude oil in waters off Northern British Columbia. Such a moratorium would be a precedent in Canada in so much as it would limit the ability of the supply chain to move a specific commodity by a specific mode of transportation in a specific area. For many in the marine industry, this appears to be a premature decision that was based on speculation rather than fact, or at least didn’t fully consider the industry’s safety record and the regulatory framework in which it operates, the legal obligations inherent in the United Nations Convention on the Law of the Sea, or the industry’s leadership approach towards continuous improvement. It was not precipitated by a significant incident involving damage to the environment or loss of life, nor was the requirement identified by another government process such as a risk assessment. While transportation professionals may view the proposed moratorium as ill-conceived, it is clearly supported by some stakeholders who may not fully understand the scope of regulatory options available to the government to manage risk.

It would be easy to view the proposed moratorium in a negative light, especially as it appears to be a predetermined outcome without respecting due process. Notwithstanding, the Government has an opportunity to get this one right now by establishing a deliberate process from the start that is inclusive of stakeholders, transparent, and which clearly recognizes fact-based decision-making. This is clearly an emerging and important theme demanded by Canadians and First Nations, and supported by governments. The Government also has the advantage of time as it does not appear as if the proposed project will move forward quickly. Northern Gateway and the Aboriginal Equity Partners have requested that the Government, through the National Energy Board, approve an extension to the sunset clause for an additional three years in order to address regulatory and legal issues and further develop partnerships with First Nation communities in the region. Although a comprehensive marine environmental assessment was covered in the Northern Gateway regulatory review, additional time provides an opportunity to further examine the risk of marine operations in Northern B.C. and how to mitigate such risk. By doing so, it should become very clear as to whether a moratorium would be the appropriate tool to address the residual risk associated with possible tanker traffic.

Perhaps this is also an opportunity to address several other important challenges associated with the management, protection and use of our waters. Canada has a sporadic strategy and approach to marine spatial planning and this continues to play out under a new government. While the Minister of Transport quite rightly speaks about the need for transportation corridors to leverage increasing trade opportunities, he does not have a direct role in developing such corridors when it concerns Canada’s oceans. In fact, the statutory authority to plan and manage the use of Canadian waters rests with Fisheries and Oceans Canada, and to a limited extent, Environment and Climate Change Canada through its agency, Parks Canada. While all of these departments have strong mandates and capable teams, none of them has a clear vision or mandate from the government to lead comprehensive marine spatial planning and so it is inevitable that a patchwork of initiatives will continue to unfold. The proposed moratorium is but one of many initiatives.

Many non-industry stakeholders may not be aware of the existing moratorium on Canada’s Pacific Coast. Concerns for the protection of the marine ecosystem are embodied in an existing voluntary Tanker Exclusion Zone that was created in 1985 largely to address the potential for a laden tanker to drift onto Canadian shores. This accomplishment was achieved through collaboration of the Canadian and United States Coast Guards and the U.S. marine industry involved in trading between Alaska and southern ports in the United States. More than 300 laden tankers transit annually along the B.C. Coast while respecting the Tanker Exclusion Zone. This positive example of collaboration and fact-based decision-making was made possible because all stakeholders had a common understanding of the risk and the objectives of mitigating the risk.

It is probable that an unsubstantiated moratorium on Canada’s West Coast would negatively affect the reputation of Canada’s commodity supply chain, potentially making Canada and Canadian ports less competitive. If the Government imposes a moratorium without due process, it would send a signal that the Canadian supply chain may not always be open for business. This approach would establish a precedent for managing undetermined risk that could propagate to other regions of the country and other modes of transportation. This mixed messaging contrasts the Government’s support for more open trading through free trade agreements such as the Comprehensive Economic and Trade Agreement and the Trans-Pacific Partnership, and growing support for fact-based decision making. The timing of such a negative signal could not be worse as a sputtering global economy continues to have negative ramifications in Canada and for marine transportation in general.

This summer will be a busy period for the government and the marine industry. Minister Garneau is convening various round tables across the country while his department conducts extensive consultation on the future of Canada’s transportation framework. While many stakeholders will naturally draw a connection between the export of oil and the proposed moratorium, the significance of the moratorium as it relates to the Canadian supply chain is cause for greater concern. The use of moratoriums should be reserved as a last resort to halt an ongoing or imminent activity that could result in social, economic or environmental harm. This proposal does not appear to pass this litmus test and perhaps there is a better regulatory approach to address a risk that has not yet been fully determined. While not necessarily easy, it will be important for our industry to demonstrate to the government that it should avoid the establishment of any moratorium affecting transportation, and that it already has several strong statutory instruments at its disposal in order to manage risk.

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