PRGT granted "substantial start" designation
Despite the delays and lawsuits facing Ksi Lisims LNG, the lawsuits directly opposing PRGT, and the reality that the company has done little more than half-clear 42km of right-of-way, the BC government has officially granted PRGT its substantially started designation.
"Substantial start" is a poorly defined legal condition laid out by the Environmental Assessment Act. Once it is granted, environmental certificates are extended indefinitely. Pacific Trails Pipeline, another proposed gas pipeline in the region, was declared "substantially started" since 2016 and remains in Enbridge's back pocket. They can begin building it at any time if market conditions align without having to go through a new assessment process.
PRGT's substantial start does not necessarily mean construction will begin shortly. But it does mean that the project is now permanently approved and the uncertainty for potential investors has declined, making it more likely the project will continue to move forward.
We won't spend too much time analyzing the decision here, but suffice it to say, as flawed as BC's environmental laws are, this decision makes a mockery of even the limited legal framework the province has. The "Substantial Start Determination Policy" directs the EAO to focus on physical work on the ground. No other project has ever been granted the designation based on just three months of work, much of which was "spin-up," particularly when the work occurred on just 1/20th of the project's proposed physical footprint.
The "Reasons for Decision" posted by the EAO and signed by Alex MacLennan, the Chief Executive Assessment Officer, lists the "physical works undertaken:"
- 42km of clearing on the right-of-way (clearing that was only done to half the final width)
- construction of a work camp
- installation of 9 bridges and upgrades to 47km of roads
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That said, the government has been signalling very clearly that they want this project to move forward, so while the decision seems particularly brazen in its flaunting of the regulatory regime, it ultimately comes as no surprise. They were either going to do this or issue a discretionary extension to the certificate.
So, what's next? Well, the company has said in communications with First Nations that they intend to start construction again in November.
The BC Energy Regulator has a rule that prevents work on pipelines from moving forward if the project's associated LNG terminal does not have a "Final Investment Decision." The BCER allowed the work to proceed last year only on Nisga'a territory, because the Nisga'a Lisims Government is a part-owner of the project. Will the province rescind this rule, or find some other work-around? Potentially. If not, project construction won't move beyond Nisga'a territory until Ksi Lisims is not just approved, but attracts enough investment to move forward. It is unlikely that PRGT will begin construction at a significant scale before Ksi Lisims has more financial momentum behind it, but that could happen by the end of the year.
It's all speculation at this point, but our suspicion is that we will see increased prep work over this summer, but no real influx of workers until the fall at the earliest. The company needs to give 30 days notice before beginning construction again.