EDMONTON – A new 500-km pipeline to be built by PetroChina subsidiary Phoenix Energy Holdings and TransCanada Corp. between northwest of Fort McMurray and Fort Saskatchewan cannot be allowed to proceed, says the Council of Canadians. But if the Harper government ratifies the Canada-China investment treaty (FIPA), then PetroChina will be guaranteed excessive compensation for any future cancellations or delays.
“These pipelines are not only the arteries carrying the dirtiest oil on Earth, they become the drivers of an expanded industry as there will be relentless pressure to keep them full. The threats to Indigenous communities and the environment are too great. We must and will stop these pipelines,” says Maude Barlow, national chairperson of the Council of Canadians, who is on tour in B.C. this month to build community solidarity and support in the growing fights to stop pipeline expansions.
“Given the dangers these tarsands projects present us with, the province cannot let Harper give Chinese companies, state-owned or otherwise, a 31-year trump card on decisions related to pipelines, oil, gas and mining projects,” adds Barlow. “This is exactly what the Canada-China investment treaty will do by giving foreign investors excessive rights to profit and the ability to challenge public policy in closed-door tribunals shielded from Canadian law and the courts.”
The Canada-China Foreign Investment Protection and Promotion Agreement (FIPA) is an investor rights agreement similar to the investment chapter (Chapter 11) of the North American Free Trade Agreement (NAFTA), which has already resulted in almost $170 million in payouts or settlements to U.S. corporations. Recently, Canada lost a NAFTA investment dispute to ExxonMobil and Murphy Oil, who complained about a profit-sharing policy in Newfoundland and Labrador that contributed to research and development in the province. The award has not been made public by the Harper government, despite its claim that these investor-state disputes are transparent.
The FIPA is also similar to several free trade deals and investment treaties Canada has signed with developing countries, including Colombia and Peru, where the Harper government wants Canadian mining companies to be able to challenge governments for any delays to their own projects. Canadian mining firms are currently disputing delays and failures to get approvals for projects in Bolivia, El Salvador, Mexico and other countries under existing FIPA-like investment treaties. U.S.-based energy firm Occidental just won a $1.8-billion award in a controversial investor-state dispute against Ecuador where the company lost an oil production permit for breaking its contract rules with the government.
“Unlike these existing deals, which are bad enough, the China FIPA guarantees excessive investment protections to Chinese firms for 15 years plus another 15 after the treaty is cancelled, if it is ever cancelled,” says Scott Harris, Edmonton-based Prairies Organizer with the Council of Canadians. “These treaties tie our hands regardless of changes in federal or provincial governments. Any province with China-based investment in natural assets or infrastructure over the next 31 years, like this proposed pipeline, should be asking Harper to delay ratification of this FIPA until a proper assessment of the impacts can happen.”
-30-
