Court Nullifies Trans Mountain Approval in Setback for Trudeau

(Bloomberg) -- Prime Minister Justin Trudeau’s bid to press ahead with construction of the Trans Mountain pipeline suffered a major setback after a Canadian court nullified approval of the project.

The Federal Court of Appeal ruled Thursday that the regulatory review of the projection was “impermissibly flawed” because it excluded project-related tanker traffic. In addition, the court also found the government failed to fulfill the legal duty to consult indigenous people.

The legal challenge had been brought by First Nations, the City of Vancouver and others, who say they weren’t adequately consulted on the National Energy Board’s approval of the project. The government can appeal the decision.

If the government is forced to redo consultations, it could mean the restart of at least an 18-month process, analysts say. The Canadian government is purchasing the pipeline from Kinder Morgan Inc. in order to ensure its construction amid opposition from indigenous and environmental groups, as well as British Columbia’s provincial government.

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