16 B.C. First Nations to become part owners of Coastal GasLink pipeline, if project is completed

By Matt Simmons

 Local Journalism Initiative Reporter

TC Energy signed equity agreements with 16 B.C. First Nations that will provide the communities with a shared 10  per cent ownership stake in the Coastal GasLink pipeline, if the project is completed.

The agreements were signed between the  pipeline company and two First Nations coalitions, CGL First Nations  Limited Partnership and FN CGL Pipeline Limited Partnership. Both groups  represent communities along the pipeline route that had already signed  benefit agreements with the company and corresponding agreements with the province.

The March 9 announcement  noted all 20 nations with existing agreements were invited to partner  on the project. It is unclear why four of the 20 First Nations did not  opt in.

It was also not immediately clear whether  any of the 16 First Nations would help assume some of the cost overruns  of a project that TC Energy says is “significantly” over budget, and behind schedule.

The 670-kilometre pipeline, if completed, would connect the province’s Montney shale gas formation in the northeast to the LNG Canada facility currently under construction on Haisla territory, in Kitimat.

“For years we have watched industry and  governments generate revenues from the operations of their projects,  while we live with the impacts,” Chief Justin Napoleon of Saulteau First  Nations, said in a press release.

Saulteau First Nations territory is in  B.C.’s northeast region, a part of the province heavily impacted by  decades of industrial activity, including forestry, hydroelectric dams  and oil and gas extraction.

“This investment in Coastal GasLink will  finally start to shift the landscape, aligning industry and Indigenous  peoples’ interests over the entire life cycle of a project,” Chief  Napoleon said.

Chief Corrina Leween, of the Cheslatta Carrier Nation in B.C.’s central interior, echoed the sentiment.

“For many of us, this marks the first time  that our nations have been included as owners in a major natural  resource project that is crossing our territories,” she said in a  statement. “This deal is important because it demonstrates the value  First Nations can bring as true partners in major projects.”

The equity options in the company would  only come into effect after construction is completed and the pipeline  begins to transport 2.1 billion cubic feet of natural gas across the  province daily. First Nations with signed agreements could then exercise  ownership options, pending regulatory approvals and consents, including  consent from LNG Canada.

The announcement further distances TC  Energy from the pipeline project, which has been contentious since it  was first proposed in

2012 and the centre of controversy and conflict  since construction began in 2019.

In late 2019, the company sold 65 per cent of its shares  in the Coastal GasLink project to U.S.-based private equity company KKR  and Alberta Investment Management Corporation (AIMCo) on behalf of  AIMCo clients. With the new agreement, TC Energy is allocating 10 per  cent of its remaining shares to First Nations.

TC Energy did not respond to The Narwhal’s questions by time of publication, but Bevin Wirzba, president of  Coastal GasLink, celebrated the announcement in a statement.

“We recognize that enduring relationships  need to include long-term economic opportunities that support the  resiliency of Indigenous communities,” Wirzba said. “We continue to  learn a great deal from these relationships and value the opportunity to

While the agreements line up 16 First  Nations to receive economic benefits after the pipeline is completed,  the project’s future remains uncertain.

The pipeline route crosses around 190 kilometres of Wet’suwet’en territory, which the Supreme Court of Canada famously ruled  has never been ceded to the Crown, meaning the Wet’suwet’en retain  jurisdiction over the land and resources. The company has agreements  with five of six elected Wet’suwet’en band councils:

Wet’suwet’en First  Nation, Skin Tyee, Nee Tahi Buhn, Witset and Ts’il Kaz Koh. Hagwilget  elected council did not sign an agreement with Coastal GasLink.

Despite the agreements with elected  councils, the Wet’suwet’en Hereditary Chiefs and their supporters  staunchly oppose the project.

This opposition led to several clashes with RCMP, including in Nov. 2021, when police arrested more than 30 land defenders and journalists  under the authority of a B.C. Supreme Court injunction against anyone  who attempts to impede the project. The conflicts garnered international  attention and condemnation from the likes of the United Nations Committee on the Elimination of Racial Discrimination, which in 2020 urged Canada to immediately cease the forced eviction of Wet’suwet’en Peoples who oppose the Coastal GasLink pipeline.

In February, Coastal GasLink reported an  attack on a key worksite near the Wedzin Kwa (Morice) River on  Wet’suwet’en territory, where the company suffered millions in damages  to equipment and project infrastructure. RCMP have not made any arrests  to date, but say they are investigating.

The Coastal GasLink project has also been facing financial difficulties and TC Energy noted in its most recent quarterly report it remains in dispute with LNG Canada over cost overruns and construction delays.

The company set up a loan agreement for  the project which would provide up to $3.3 billion in temporary  financing. As of the end of 2021, $238 million in loans was outstanding.  It is not clear how this debt will be repaid to TC Energy, nor whether  the sale of equity shares will impact the project’s financial standing.

 Matt Simmons  is a Local Journalism Initiative reporter who works out of the NARWHAL . The Local Journalism Initiative is funded by the Government of Canada.

 

Add Your Voice

Is there more to this story? We'd like to hear from you about this or any other stories you think we should know about. Contribute your voice on our contribute page.