(Adds reaction from federal government, TransCanada)
By David Ljunggren
OTTAWA, Sept 9 Canada's energy regulator said on
Friday that a panel assessing TransCanada Corp's
proposed Energy East pipeline was quitting, a decision that will
drag out an already-lengthy appraisal process.
Critics had demanded two of three panel members quit after
it emerged they had privately discussed the project last year
with former Quebec Premier Jean Charest, who was working for
TransCanada as a consultant at the time.
The regulator, the National Energy Board (NEB), said in a
statement that the panel was stepping down "to preserve the
integrity" of the board and the Energy East review.
Although the panel members had talked to Charest and others
in good faith, "they understand that their participation in
these meetings may have created an apprehension of bias," which
could undermine the board's credibility, the statement said.
The announcement represents another challenge for the
project, which is designed to carry 1.1 million barrels of crude
per day from Alberta's oil sands to Canada's East Coast, where
it can be sold onto more lucrative international markets.
The push for Energy East came after U.S. President Barack
Obama last November rejected TransCanada's Keystone XL pipeline
to the United States. Environmentalists fear the projects would
spur development of Canada's carbon-intensive oil sands.
The panel that quit had been probing the section of the
pipeline that would cross the predominantly French-speaking
eastern province of Quebec.
That hearing will now be suspended until the NEB names
another panel. This could take time since there are very few
qualified French-speaking experts, officials say.
As it stands, the NEB has until March 16, 2018, to issue its
Keith Brooks, a program director for Environmental Defence,
a leading green group, welcomed the announcement, but complained
it did not go far enough.
"The apprehension of bias ... has damaged the entire review
process beyond repair," he said in a statement.
A spokesman for Canadian Energy Minister Jim Carr described
the delay of the review as unfortunate, but added it was crucial
that the NEB showed itself to be independent and neutral.
TransCanada said it accepts the panel's decision and looks
forward to the hearings resuming, according to a company
In January, the Liberal government of Prime Minister Justin
Trudeau said it would modernize the NEB, but not before the
regulator had examined Energy East.
More than 50 environmental groups sent a letter to Carr and
Trudeau on Thursday demanding an overhaul of the regulator
before an Energy East decision.
(Reporting by David Ljunggren; editing by Andrew Hay and G