Faced with a choice between respecting Supreme Court confirmed indigenous governance and serving foreign financial interests (Shell, Petronas, and PetroChina), BC NDP joined with the land polluters, not the land protectors.
The Horgan Government had opportunity to further reconciliation of historically oppressed people and honour the wishes of Wet’Suwet’en leaders, titleholders responsible for lands upon which Coastal GasLink pipeline is to be imposed.
Somehow, the Premier and his minions believe this in not in conflict with their much ballyhooed CleanBC program.
Following in the Liberal tradition of never missing an opportunity to reward friends and party members with patronage opportunities, NDP appointed 18 people to the province’s Climate Solutions Council. I presume the provincial treasury has ways of lessening any feelings of hypocrisy.
Coastal GasLink is a financial disaster in the making. At NEB hearings, Kinder Morgan said the Trans Mountain pipeline expansion would cost $5.4 billion. Now the estimate is $12.6 billion and counting. Add to that $4.5 billion Ottawa paid KM and more than $17 billion is committed to a project the private sector wouldn’t build.
Like Kinder Morgan, Calgary based TC Energy Corporation bailed on the Coastal GasLink Dawson Creek-Kitimat project, selling 65% to Alberta’s public pension plan manager AIMCo, which is in partnership with the National Pension Service of Korea.
When the final cost escalates and operating losses need coverage, we can bet it won’t be private investors who pay additional amounts. Conservatives like Jason Kenney, who claim to despise socialism, seem always ready to use public funds to protect private interests.
If wondering about appropriateness of investing more than $30 billion (including built-for-gas Site C) in fossil fuel expansion, consider the academic paper Causes and Cures of Poor Megaproject Performance. It suggest certainty there will be more to pay.
A few highlights:
Megaprojects are the delivery model used to produce large-scale, complex, and one-off capital investments in a variety of public and private sectors. With a total capital cost of US$1 billion or more, megaprojects are extremely risky ventures, notoriously difficult to manage, and often fail to achieve their original objectives.
[The paper] rejects technical explanations as the main reason for inadequate forecasting and discusses poor performance as a result of psychological and behavioral reasons and how those affect decision making.
The three most predominant concepts in this theme are:
(1) optimism bias (delusion): executives are overly optimistic and thus overestimate benefits and underestimate costs;
(2) strategic misrepresentation (deception): executives strategically misrepresent the truth and seek to satisfy their own interests; and
(3) escalating commitment (inertia): executives continue to follow the pattern of behavior leading to unsuccessful outcomes rather than follow an alternative course of action.
The main cause of poor performance associated with optimism bias is biased judgment and advice provided by experts in their fields who tend to create an optimistic scenario and circumvent known risks and unforeseeable uncertainties. This is an unconscious phenomenon that psychologists classify as the planning fallacy, leading executives to underestimate costs in several areas of complex projects.
The leading cause related to strategic misrepresentation refers to diverse pressures (political, organizational, and individual) forcing the decision maker to manipulate the situation by usually under-estimating costs and ignoring risks.
Early estimates and forecasts are used deceptively to inform decision making and achieve the necessary alignment and support from stakeholders (including the taxpayer) to proceed with that preferred project.
The primary cause connected to escalating commitment is the overall perception, which mostly works as a norm, that, once started, a megaproject is too big to fail and too costly to stop. Managers allocate resources in order to complete the project, even when subsequent assessments and audits indicate a decision in another direction, where the final benefits are no longer superior to the necessary investment.