Environmentalists celebrate as B.C. rejects controversial Northern Gateway pipeline

The B.C. government has formally rejected the $5.5-billion Northern Gateway project that would have piped Alberta oil sands bitumen across the province to a new export terminal on the northern B.C. coast.

The Liberal government, which won re-election less than a month ago on a mandate of resource-driven job creation, disclosed its decision Friday in its final written submission to the Northern Gateway Pipeline Joint Review Panel.

"British Columbia thoroughly reviewed all of the evidence and submissions made to the panel and asked substantive questions about the project, including its route, spill response capacity and financial structure to handle any incidents," Environment Minister Terry Lake said in a news release.

"Our questions were not satisfactorily answered during these hearings."

B.C. Premier Christy Clark had set several conditions for the province to approve the project proposed by Calgary-based Enbridge Inc., which is a high priority for the federal Conservative government.

[ Related: Northern Gateway cannot go ahead as proposed, B.C. government tells review panel ]

They included measures to minimize the risk of an oil spill either from the 1,177-kilometre pipeline or the supertankers that will have to thread their way into the proposed terminal at Kitimat, B.C., a quick spill-response plan, as well as satisfying legal and treaty obligations to B.C. First Nations.

The most controversial condition demanded that B.C. receive a "fair share" of the economic benefits from the project "that reflects the level, degree and nature of the risk borne by the province, the environment and taxpayers."

Clark had argued that the lion's share of the benefits would flow to Alberta and its energy sector, and to manufacturers and supplies in eastern Canada.

"Northern Gateway has said that they would provide effective spill response in all cases," Lake said in his news release.

"However, they have presented little evidence as to how they will respond. For that reason, our government cannot support the issuance of a certificate for the pipeline as it was presented to the Joint Review Panel."

The B.C. government's complete submission to the federally run review panel can be seen here. The province is scheduled to present its final oral arguments to the panel when hearings resume June 17 in Terrace, B.C. The panel is expected to give its recommendation on the project next fall.

Enbridge had not reacted to the announcement as of early Friday afternoon but the environmental movement was quick to praise the move.

"Days like this give meaning to 50 years of environmental activism," John Bennett, executive director of Sierra Club Canada, said in a news release congratulating Clark and the people of British Columbia for "their historic decision" to reject Northern Gateway.

"Words cannot express how much I admire the activists and First Nations who made this decision possible."

George Hoberg, a professor of environmental and natural resource policy at the University of British Columbia and self-styled "climate hawk," tweeted this reaction.

The U.S.-based National Wildlife Federation also welcomed the announcement.

Greenpeace Canada was ecstatic.

The B.C. government's rejection of Northern Gateway likely spells the end of the controversial project, which ran into staunch opposition from environmentalists, First Nations and other residents along the route.

[ Related: Northern Gateway panel releases 199 pipeline conditions ]

But the province left the door open to another contentious proposal to more than double the capacity of the existing Trans Mountain pipeline into Vancouver operated by Kinder Morgan Canada.

"The position adopted by B.C. on the Northern Gateway Pipeline project as currently proposed is not a rejection of heavy-oil projects," the government said in its news release.

"All proposals — such as Kinder Morgan's Trans Mountain Pipeline Expansion or the Kitimat Clean project — will be judged on their merits. The province's five conditions would still apply."

[ Related: Clark found the right formula in focusing on economy and debt ]

NDP leader Adrian Dix's unexpected announcement midway through the election campaign that he would reject the Kinder Morgan project is thought to have factored into the party's surprising defeat at the polls. Clark and the Liberals painted the party as opposed to resource-based economic development.