Canada Court Throws Out Permits for Seismic Testing in North

Canada's top court handed aboriginals a partial victory on Wednesday, ruling there was not adequate consultation on plans to conduct seismic testing for oil and gas in the north of the country, but dismissing a separate attempt to quash permits for changes to an Enbridge Inc pipeline.

In the two separate but related decisions, the Supreme Court of Canada found that while the Canadian government holds ultimate responsibility for ensuring that consultations with First Nations are adequate, it can rely on the national energy regulator's process to fulfill that in oil- and gas-related matters.

The cases were closely watched for their clarification of the government's duty to consult with First Nations at a time when Prime Minister Justin Trudeau has promised to build a stronger relationship with the country's aboriginals.

In the case of plans by a Norwegian consortium to conduct seismic testing in Baffin Bay and Davis Strait, a preparatory step in oil and gas exploration, consultation with the Inuit that hunt nearby was inadequate in a number of ways, the court found, overturning the National Energy Board's (NEB) approval of the project.

The group includes Petroleum Geo-Services Inc and TGS-Nopec Geophysical Co ASA.

"While the Crown may rely on the NEB's process to fulfill its duty to consult, the consultation and accommodation efforts in this case were inadequate and fell short in several respects," the court said in its unanimous decision.

Among other things, the Inuit of Clyde River were given limited opportunities for participation and there was no assessment of the project's impact on their rights to hunt.

In contrast, in the second case, the court found the Chippewas of the Thames First Nation in Ontario were given notice adequately early of hearings on changes to Enbridge's Line 9 oil pipeline, which runs between Sarnia, Ontario, and Montreal, through what the Chippewas regard as their traditional territory.

The NEB assessed the potential impact on their rights and found the negative consequences were minimal, the court found.

"Even taking the strength of the Chippewas' claim and the seriousness of the potential impact on the claimed rights at their highest, the consultation undertaken in this case was manifestly adequate," the court wrote.

The Chippewas had sought to have the NEB's approval of the project overturned.

The changes to the pipeline reversed the flow of oil in a section of the line and increased its capacity to 300,000 barrels a day. Virtually all of the required construction occurred on lands owned by Enbridge and on their right of way.

Reporting by Leah Schnurr