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Donald Trump, Eminent Domain & Property Rights

October 23, 2015 By Admin

Written by CAEPLA

“In the long run, one of the best ways to promote economic development is to respect property rights.”

In the rush to stop Trump’s presidential bid a lot of media and pundits have suddenly discovered property rights because Eminent Domain (government expropriation) is one of the GOP front runner’s vices.

This is good news for Canadian landowners as US political topics eventually trickle into the public debate in Canada too.

This article, while a bit too sympathetic to the “hold out” argument in favour of expropriation, does point out a couple of things CAEPLA supports: engineering innovation and secret assembly.

There is simply no need to violate property rights, ever. Respecting property rights in fact enhances economic development.

Arguably resorting to Eminent Domain/expropriation hurts industry.

The case could be made that had TransCanada not indulged in the practice in Nebraska and other states for the construction of its ill-fated Keystone XL pipeline, the project might have gone through. Local farmers and ranchers would not have been alienated, meaning celebrity and other environmental activists might not have found fertile ground to help create the political cover President Obama needed to block it.

We would note too that in Canada, where TransCanada effectively respected landowners and property rights, CAEPLA was able to negotiate a precedent setting, ‘win, win’ business agreement with the company.

We look forward to seeing how the latest property rights debate plays out over this US election cycle. If you want to take a closer look at the subject we hope you will check out the first issue of the quarterly print edition of the Pipeline Observer, where several writers discuss the topic and its importance to you as a landowner and citizen at length. If you are already a member of CAEPLA you will be receiving your copy in the mail soon. If you would like a free subscription, contact us here.

Filed Under: News

Will Trudeau promote pipelines and make the NEB respect your property rights?

October 23, 2015 By Admin

Pipeline Politics

Written by CAEPLA

Canada’s 42nd federal election is finally over.

Justin Trudeau is in with a majority and Stephen Harper, styled by some the “pipeline prime minister,” is out.

CAEPLA of course is non-partisan but that won’t stop us asking what you and pipeline landowners across the country are wondering right now: what will the Trudeau Liberal government mean for pipelines and property rights in Canada.

No new major pipeline projects were completed on Mr. Harper’s nearly ten year watch, despite the moniker.

We already know PM-elect Trudeau is supportive of TransCanada’s controversial and long delayed Keystone XL, the Canadian leg of which was completed with CAEPLA’s assistance and without incident nearly a decade ago.

Mr. Trudeau has also said he would “send Enbridge back to the drawing board” on Northern Gateway (Source: ResourceWorks Newsletter), adding “I am, however, very interested in the Kinder Morgan pipeline, the Trans Mountain pipeline that is making its way through — I certainly hope that we’re going to be able to get that pipeline approved.”

It appears the incoming prime minister is generally supportive of pipeline development and is on record as saying we need more resource development to create jobs for the middle class he put at the centre of his platform.

Interestingly, a minor controversy during the election over revelations a top Liberal operative was offering advice to TransCanada on how to lobby government to get Energy East built failed to derail the party’s electoral fortunes.

This could indicate popular opposition to the project is not particularly strong and that Trudeau himself will be given a lot of latitude by the public when it comes to high profile pipeline projects.

Indeed left of centre parties like the Liberals are often politically more able to “get away” with implementing “right wing” policies than Conservatives are – case in point the Paul Martin Liberals being more hawkish on the fiscal front than Mulroney ever was.

So if we can be reasonably confident a Trudeau administration will approve major pipelines – albeit with tougher environmental rules, or the appearance of same, along with better salesmanship — sometime soon, what might this mean for the property rights of pipeline landowners looking to participate in a new energy transport boom?

This is a significant question given Mr. Trudeau’s pledge to reform the National Energy Board (NEB).

Could respect for property rights become criteria for the Board along with yet more environmental consideration?

This is not as farfetched as it might sound.

Justin Trudeau has made it clear he is a proud champion of the Charter – his father Pierre was its architect, after all.

What is not commonly known especially among conservative minded Canadians is that the elder Turdeau had originally wanted to include property rights in the document.

That they were left out has been a bone of contention for conservatives and property rights advocates ever since.

The second Prime Minister Trudeau has an opportunity to complete his father’s Constitutional vision in a way that benefits landowners, industry and the economy as a whole.

And the first best opportunity Mr. Trudeau has to do so would be repealing the NEB’s powers of expropriation and allow landowners and industry to partner in the ‘win-win’ business agreements CAEPLA advocates.

Filed Under: News

NEB Promises to “Do Things Differently”

October 7, 2015 By Admin

Written by CAEPLA

Government needs to talk property rights with landowners – or get out of the way.

At this summer’s National Energy Board (NEB) Safety Forum, newly minted Board chair Peter Watson informed those of us in attendance that he planned to do things differently.

As a long-time advocate of the NEB doing things differently – or better yet, not at all – I was curious. His predecessor had claimed the Board could only operate within the limitations of government legislation. So I asked Mr. Watson, publicly, what in fact he meant by “doing things differently.”

His response was that he intended to consult and “talk more” with “stakeholders.”

The new chair did not elaborate on who all he would recognize as “stakeholders.”

But unless Mr. Watson starts talking to landowners – the only real “stakeholders” – about property rights, he won’t really be saying anything new at all.

Property rights are the pre-requisite for any serious discussion about safety.

When most people talk about pipeline safety what they are really talking about is protecting people and the environment – i.e., public and private property – from the risk of leaks and spills.

Property rights empower landowners to demand the safest pipelines possible in the deals we negotiate – something even company shareholders want, too.

That’s because property rights are the foundations of a free market system that includes contract and the rule of law which has always been the real way to guarantee the greater good.

Expropriation of private property for the benefit of governemnt and its cronies throws the whole system out of whack.

It is just a subsidy, a kind of rent control, and license for indifferent or reckless behaviour by the recipient.

In other words, if you get to use something for next to nothing, and you don’t even own it, you tend not to look after it very well. This is what’s known in economics as Tragedy of the Commons. It’s the same reason why rent controlled, subsidized, and public housing usually deteriorates so badly – people are getting it for free or cheap, so they don’t look after it.

Meanwhile, even though the majority of landowners are pro-oil pro-development, they are increasingly also pro-property rights and pro-choice — meaning they want the right to say no to a bad development deal.

As we at the Canadian Association of Energy and Pipeline Landowner Associations (CAEPLA) like to say, “Landowners want in!”

In other words CAEPLA encourages agribusiness and other landowners to see themselves not only as voluntary partners in the energy transport industry, but as part of that industry.

Which of course would make the NEB redundant.

Regulators’ original purpose was never really safety or the environment. Those agenda items were only added to their mandate in order to placate the public and justify the Board’s existence.

The NEB has never been an effective guarantor of safety and has lost whatever public confidence it might have enjoyed in any case.

The real route to pipeline safety are property rights that recognize landowners’ right and responsibility to steward the land, to ensure the safety the public demands by way of ‘win-win’ business agreements bound by contract law.

Why would anybody – industry, landowners, or the public – want government to meddle and insert itself in energy transport?

While it may once have protected pipeline companies and politicians, the NEB has never benefited landowners and the public. In fact, the bureaucratization and politicization of pipelines has now paralyzed the industry, with few or no new project in any danger of proceeding any time soon.

This obviously hurts the companies, but it also hurts farmers and the public who rely on safe, abundant cheap energy.

CAEPLA has proven of late that landowners can work with, in, and as part of the energy transport industry.

So if a safe prosperous energy economy is the goal – why not get government regulators out of the way? Why not let the real stakeholders – landowners and pipeline companies get on with it, just like EVERY…OTHER…INDUSTRY…does?

Filed Under: News

AltaLink line could face fight in Supreme Court

September 30, 2015 By Admin

30 Sep 2015

Lethbridge Herald

THE CANADIAN PRESS — EDMONTON

Some Alberta landowners are hoping to use the Supreme Court to fight a power transmission line that they say could be left idle as the province cuts its greenhouse gas emissions.

The landowners are completing an application to appeal a provincial regulatory decision that gave power transmission company AltaLink approval to use their property for the line.

Lawyer Donald Bur said Alberta’s Surface Rights Board unfairly ruled that AltaLink’s 350 kilometre line from west of Edmonton to the Calgary area should be considered entirely in Alberta, even though it connects to power lines that leave the province.

That would mean the board didn’t have the right to grant permits to the company to access the appellant’s land, he said.

“All we can do is say to the Surface Rights Board, ‘You don’t have jurisdiction, so you cannot grant a right of entry order on this land,’” said Bur.

If the Supreme Court decides to hear the case, Bur said his clients will ask the court to tell AltaLink to remove the line from their property.

The line has long been controversial.

Alberta’s previous Tory government called the line crucial infrastructure. But critics argued its capacity was far in excess of what Albertans required.

Filed Under: News

Lundbreck area resident talks transmission lines to MD council

September 2, 2015 By Admin

Wednesday, September 2, 2015

Photo from Russ Thompson letter
to council – possible location of
power line crossing, north
of Lundbreck

Chris Davis

Lundbreck area citizen Russ Thompson appeared as a delegation before council for the Municipal District of Pincher Creek No. 9 at their August 25 meeting. He expressed his concerns about potential power line construction in his area. Using maps and diagrams he illustrated those concerns and his proposed alternative solutions. Among other things, Thompson would prefer to see a crossing at the man-made Oldman River Dam Provincial Recreation Area instead of across natural areas of the Crowsnest River and Connelly Creek. According to Thompson, “AltaLink’s proposed routing along Highway 3 will devastate existing viewscapes”.

Map of Lundbreck area, from
Russ Thompson document
submitted to council

Regulatory power for transmission lines is reserved for the Alberta Utilities Commission (AUC), Council for the Municipal District of Pincher Creek No. 9 has no regulatory power but is regularly asked by its citizens to present their concerns to the provincial government.

“My background is in pipeline routing, so 30 years of routing experience on linear projects, albeit on pipelines, not power lines,” said Thompson. “I have looked at all the AltaLink routes, and I would like to present some alternates to you today.””In October, 2014 AltaLink had a different map, that showed 500Kv routes, but they really didn’t tell us they intend to build two lines on the site with Kv sections.”

“There is not just one, but but two sets of towers along those roads.””It’s definitely going to impact the viewscapes around here, having 2 500 Kv lines, versus a single line.”

“AltaLink’s shortest route is 38.27 kilometres. The next shortest is 38.4.”

“The one to Chapel Rock is 13.5 kilometres of 500 Kv, so that’s those two lines, whereas our option has 4.7 kilometers of 500 Kv which will equate to 9.4 kilometres of 500 Kv with the two lines there.

Thompson was also concerned about greenfield ratios. “How much of the new alignment is what’s called greenfield. That’s not parallel to existing infrastructure, such as pipeline right away, or utility corridor. Anytime you are not directly abutted to that, it’s called greenfield.”

“Greenfield is fairly important.” Thompson said the level of greenfield can escalate a project to another level of regulatory control.

“I was really alarmed when I saw these green fieldpercentages.” He said one route along the Pincher Creek Airport had 78% greenfield.

Water crossings were also a concern for Thompson. “It (Crowsnest River north of Lundbreck) is the most picturesque part of the river, and that’s exactly where AltaLink is proposing to cross.”

According to Thompson there are some issues around power lines crossing at the Oldman River Dam Provincial Recreation area. “AltaLink is trying to stay out of that, because there are some issues crossing that. In exchange for crossing a man-made feature for ease, they are proposing to cross a pristine river valley.”

Thompson explained the area was enhanced to replace destroyed habitat when the dam was established, and said it was home to wildlife and migratory birds, and frequented by kayakers and fly-fishers.

He demonstrated one proposed route with 4 crossings across Highway 3 between Pincher Station and Lundbreck. “This is going to look like an industrial park, if that route is adopted.”

“These towers are 60 to 70 metres tall. That’s 6 to 10 times taller than any structures, any aluminum power line structures that are out there, so these things are going to be very intrusive. They are going to impact all of our views.”

A view near Lundbreck –
Photo from Russ Thompson
letter to council

He said of a proposed route that goes close to Cowley “You’re pushing 150, 146 residences that would be within 800 meters, which is pretty significant.” He said Lundbreck also was also affected by this route.

“I looked at all these roads on the ground, this wasn’t just a desktop exercise,” said Thompson, at one point explaining he had driven over 300 km of back roads.

“You can lessen the impact everywhere you are, but that requires crossing the reservoir.”He offered alternate routs that he said ranged from 4.8 to 13 kilometres shorter than what Alta Link has proposed. “That being the case, it should be significantly less cost to the rate payers, and should have significantly less footprint in the MD.”

He said the routes he is proposing would have less visual impact as they do not run along the highways as much, two of his alternatives have no crossing of Highway 3, and they cross waterways. “Let’s cross it at the reservoir. It’s a man-made feature versus natural.”

Thompson said AltaLink’s proposed routes have anywhere from 37-146 residents within 800 metres, while his route proposals include some guidelines. “The green option has zero residences within 114 metres, and only 14 within 800 metres.””Another thing I want to point out to you is AltaLink just a few years ago built this line to Goose Lake which is just northeast of town, here. They’ve already developed a corridor to there, now they want to develop another corridor west of the Highway 6 junction that runs north-south. When is enough enough?”

Thompson said he presented his suggestions to AltaLink. “Their current position is they are not going to entertain any of the routes that I’ve suggested. I fully expected that they would say that. I think it is very apparent that AltaLink is not going to do anything, unless they’re forced to do it. The only people that are going to be able to force them to do it are the people who live in this area, and maybe the other people in this province that say enough’s enough.”

Filed Under: News

Windmill in Cowley Falling Down on the Job

September 1, 2015 By Admin

The wind caused a Windmill in the Cowley area to fall down. Pictures shown below provided by alf2000:

Windmill5

Windmill6

Windmill8

Windmill9

Windmill1

Windmill2

Windmill3

Windmill4

Filed Under: News

Canadian Natural posts $405-million net loss on higher tax rate, lower revenue

August 10, 2015 By Admin

Follow The Lethbridge Herald on Twitter @LethHerald Latest Tweet

By The Canadian Press on August 6, 2015.

CALGARY – Canadian Natural Resources Ltd. (TSX:CNQ) had a $405-million net loss in the second quarter but the company says it would have been profitable without a 20 per cent increase in Alberta’s corporate tax rate.

The Calgary-based oil and gas producer says the higher tax rate – which rose to 12 per cent as of July 1 – increased Canadian Natural’s deferred income tax liability by $579 million.

Excluding that item, Canadian Natural says it had $178 million of adjusted earnings from operations.

The results were weak compared with the same period last year, when Canadian Natural had $1.07 billion of net earnings and $1.15 billion of adjusted net earnings.

Canadian Natural’s revenue fell 36 per cent or nearly $2 billion compared with the second quarter of 2014, when global oil and gas prices were much higher.

It says total revenue the second quarter was $3.42 billion, down from $5.37 billion a year earlier.

Filed Under: News

Canadian Natural blames Alta. tax rate for loss

August 10, 2015 By Admin

Follow The Lethbridge Herald on Twitter @LethHerald Latest Tweet

By Lauren Krugel, The Canadian Press on August 6, 2015.

CALGARY – Canadian Natural Resources is warning that Alberta’s corporate tax hike will hit employment, though both company executives and Premier Rachel Notley agree the steep drop in crude prices is a much bigger challenge.

The Calgary-based oil and gas giant posted a net loss of $405 million during the second quarter, mostly because of a $579-million charge related to the higher tax rate.

All things being equal, the higher tax tab means $579 million less will be invested over the lifespan of Canadian Natural’s assets, chief financial officer Corey Bieber said in an interview.

That figure translates into 4,100 fewer “position years” of direct, indirect and induced employment in that time span, he said, citing a study by a third-party consultant.

The study wasn’t undertaken specifically to look into the impact of the tax changes, but is part of work the company routinely does as part of the regulatory process for its projects, said president Steve Laut.

Unlike many of its peers, Canadian Natural has not announced staff layoffs since crude prices began their sharp decline from above US$100 a barrel a year ago to around US$44 on Thursday. Rather, top brass are taking a pay cut and company-wide pay increases have been scrubbed.

Notley, speaking to reporters in Edmonton, said Albertans accept that higher corporate taxes are going to hit the bottom lines of companies.

“Albertans clearly considered that issue very thoroughly in the last election,” she said. Given the province’s fiscal challenges, Albertans realize it’s necessary to “pull up our socks and tighten our belts” and “everybody needs to chip in.”

She said the tumbling price of crude is having a much bigger impact on employment than the tax increase to 12 per cent from 10 per cent, which came into effect on July 1.

Bieber agrees with that assessment.

Between the first six months of 2014 and the first six months of 2015, Bieber figures the price drop had around a $2.3-billion impact on cash flow.

“The bottom line is, reduced cash flow leads to less ability to reinvest in the business and ultimately that’s what drives growth of the economy,” he said.

Canadian Natural is one of a number of major Calgary oil company to take a tax charge against its second-quarter results.

Last week Canadian Oil Sands (TSX:COS) said its deferred tax expense was $120 million during the quarter, while Imperial Oil (TSX:IMO) took a $320-million charge. A $315-million tax expense at Cenovus Energy (TSX:CVE) was mainly due to the Alberta tax hike, as well.

Without the tax expense and other items in the mix, Canadian Natural said its adjusted earnings from operations were $178 million, compared to $1.15 billion a year earlier.

The Alberta government is setting up expert panels to look into the province’s royalty rates and climate change policy. Notley said more details will be coming out next week.

Laut said until there’s clarity on what kind of additional costs may arise from both reviews, it can’t pin down 2016 spending plans.

He sees work on the Horizon oilsands expansion continuing and more drilling off the shores of Cote d’Ivoire in West Africa.

“But other than that we have to wait and see how the world shakes out.”

Follow @LaurenKrugel on Twitter.

Filed Under: News

Abandoned wells remain Alta. concern

August 5, 2015 By Admin

4 Aug 2015
Lethbridge Herald
Ian Bickis
THE CANADIAN PRESS — CALGARY

ALBERTA NEEDS TO STRENGTHEN PROGRAM TO DEAL WITH DORMANT OIL WELLS: CRITICS

A program in Alberta to deal with thousands of dormant oil and gas wells that don’t meet safety and monitoring standards needs to be strengthened, critics say as falling crude prices could see their numbers swell.

Energy operators have brought about 3,600 wells in line with regulations as part of a compliance program the province launched in April. The Alberta Energy Regulator’s goal for the 2015-16 fiscal year is just under 5,500 wells.

While that shows that the organization is two-thirds of its way to meeting its goal, that still leaves more than 22,100 wells that aren’t complying with rules that govern fencing, and testing for leaks, among other measures, said Carrie Rose, a spokeswoman for the regulator.

Rose said the program is meant to bring them into compliance over the next five years.

But Barry Robinson, the national program director for regions at Ecojustice, said in the meantime those wells could still contaminate the environment.

“In the worst-case scenario you can have a well that is venting something or leaking something and not being aware of it because you’ve never done the pressure testing that was required,” said Robinson.

Jason Unger, staff counsel at the Environmental Law Centre, said the regulator should explain why operators were allowed to have so many wells not complying with regulations in the first place.

A bigger problem is that the program doesn’t set deadlines for well closures, Unger added.

He said unreclaimed wells continue to impact the land and could affect property values, while an increase in the number of inactive wells means an overhang of liabilities for companies that may not be able to pay reclamation costs.

“It’s reliant on the operator to determine when to abandon them,” said Unger.

Concerns over inactive wells comes as the number of orphaned wells has swelled from 162 in March to more than 700.

Wells are orphaned when the company that owns them goes bankrupt or can’t be found. The wells then become the responsibility of the Orphaned Well Association, an industry-funded group that was set up to deal with them.

Brad Herald, a director of the association, says low oil prices have contributed to an increase in orphaned wells.

“We know that given the economic times, there’s probably more coming,” said Herald.

Despite an increase in the number of orphaned wells, Herald doesn’t think Alberta needs to set timelines for reclaiming old wells.

He said wells can be inactive for a variety of reasons, from waiting for the construction of a pipeline to holding on until prices recover.

But Robinson says the province should consider firm timelines for well reclamation like many U.S. states have, because many wells in Alberta have been sitting idle for years.

According to the Alberta Energy Regulator, of the roughly 77,000 inactive wells in the province, 18,000 haven’t been active for more than a decade.

“If there’s some good reason why the well’s been inactive for five years and needs to be inactive longer, well then the company should have to justify that,” said Robinson.

Last year, the Progressive Conservative government committed to reviewing well closure timelines.

A spokeswoman for Environment Minister and Lethbridge West MLA Shannon Phillips said in an email that the current NDP government will look at strengthening existing programs to address inactive and orphaned wells.

Filed Under: News

Watchdog welcomes findings against TransAlta

August 5, 2015 By Admin

29 Jul 2015
Lethbridge Herald
Ian Bickis
THE CANADIAN PRESS — CALGARY

HEAD OF UTILITY WATCHDOG PLEASED WITH ALBERTA COMMISSION DECISION

The Alberta Utility Commission’s conclusion that TransAlta triggered outages at power plants to raise electricity rates is a welcome step towards fair markets, the head of the province’s utility watchdog said Tuesday.

“It’s a huge win for Albertans, who deserve to benefit from a fair, efficient, openly competitive market,” said Harry Chandler, administrator of the Market Surveillance Administrator. Chandler accused TransAlta of deliberately timing outages at coalfired power plants in Alberta at peak times in late 2010 and early 2011 in order to drive up electricity prices.

In a report released Monday, Alberta’s Utility Commission agreed.

During hearings held by the commission, TransAlta argued that it believed it was allowed to do that based in part on discussions with the Market Surveillance Administrator. But the commission found that TransAlta should have made further consultations before going ahead with its plan.

TransAlta has said it is reviewing the ruling, and a further response could include the possibility of an appeal to the province’s highest court.

Chandler said the decision provides more clarity for Alberta’s utility market going forward.

“This is a watershed decision that all market participants, and even outside of Alberta, are going to pay a great deal of attention to because it gives very clear guidance on appropriate behaviour in the electricity market.”

The commission said it will resume proceedings later to determine how much TransAlta benefited from the closures and what penalties to impose against the company.

Filed Under: News