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Alberta Wins “Turn Off Oil Taps” Court Battle

Canada’s oil-producing province of Alberta scored a win in court this week after the Federal Court of Appeal said that the province had the right to enact its “turn-off-the-taps” legislation and to control the volume and the destination of oil flowing through its pipelines to other provinces.

During the height of the dispute between Alberta and neighboring British Columbia over the Trans Mountain Expansion project to twin the existing pipeline and expand the terminal in Burnaby, B.C., Alberta’s government approved in early 2018 the so-called Bill 12, which would give it the powers to reduce the flow of crude oil to British Columbia in retaliation for B.C.’s relentless efforts to put a permanent end to the expansion of the Trans Mountain pipeline.

Immediately after Alberta adopted the legislation, British Columbia’s Premier John Horgan threatened to take Alberta to court to prevent the neighboring province from enacting the legislation.

“If the Alberta government chooses to proclaim their legislation, we will move quickly to strike it down,” Horgan said at the time.

The court battle that ensued resulted in 2019 in a court granting British Columbia a temporary injunction against the bill on the grounds that the “turn-off-the-taps” legislation, if acted upon, would cause harm to its residents. Alberta’s argument in the case was that this harm was speculative.

The Federal Court of Appeal, however, ruled on Tuesday that the injunction granted to British Columbia by the lower court should be overturned. The province of British Columbia was also ordered to pay the costs of the litigation, the three justices said.

“We are pleased with yesterday’s decision by the Federal Court of Appeal. We remain committed to standing up for Alberta, including protecting the value of our natural resources,” Alberta Energy Minister Sonya Savage said in a statement on Wednesday carried by The Canadian Press.

By Tsvetana Paraskova for Oilprice.com

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