Montreal, Canada - Canada's Federal Court of Appeal on Tuesday dismissed a challenge to a contentious, multibillion-dollar oil pipeline, effectively giving the Trans Mountain pipeline expansion project the green light to move forward.

In its unanimous decision, the court said the government's consultation process with indigenous groups "was anything but a rubber-stamping exercise".

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The legal challenge centred around whether Canada had adequately consulted with a handful of Indigenous groups along the 1,150 kilometre (715-mile) Trans Mountain route. Some of those groups had raised concerns about the project's effects on the environment and their rights.

"The evidentiary record shows a genuine effort in ascertaining and taking into account the key concerns of the applicants, considering them, engaging in two-way communication, and considering and sometimes agreeing to accommodations," the court said. "It is true that the applicants are of the view that their concerns have not been fully met, but to insist on that happening is to impose a standard of perfection, a standard not required by law."

The Trans Mountain pipeline runs tar sands oil from Edmonton, Alberta, to a terminal on the British Columbia (BC) coast.

Steel pipe to be used in the oil pipeline construction of the Canadian government's Trans Mountain Expansion Project lies at a stockpile site in Kamloops, British Columbia [Dennis Owen/Reuters]

The $5.6bn ($7.4 billion Canadian) expansion project, which Ottawa purchased in 2018 and approved in June 2019 amid widespread opposition, would see the pipeline's capacity nearly triple to as many as 890,000 barrels of oil per day.

In December, the Federal Court of Appeal heard from four indigenous groups who said they were not adequately consulted by the government between August 2018 and June 2019.

The Squamish and Tsleil-Waututh nations, the Coldwater Indian Band, and a coalition of smaller indigenous nations from the BC interior said their concerns about the project's effects on their way of life and the environment were not meaningfully considered.

They also raised fears that an increase in tanker traffic off the BC coast near Vancouver - from where the oil will be exported abroad - could lead to a spill.

'Very disappointing'

Rueben George of the Tsleil-Waututh Nation, one of the applicants in the case, said the court's decision was "very disappointing".

"Reconciliation stopped today," said George, speaking to reporters from a podium marked with "Together Against Trans Mountain" in Vancouver on Tuesday afternoon.

But he said the Tsleil-Waututh "always said we would do what it takes to make sure that we stop this pipeline".

"We have proven that it's not in the best interest of our nations that are standing here - for Vancouver, for British Columbia, for Canada," he said.

The Tsleil-Waututh are awaiting a decision on an earlier appeal to the Supreme Court of Canada to widen the scope of its legal challenge against the expansion project and George said the community would not give up its fight.

"This government is incapable of making sound decisions for our future generations, so we are and we will," he said.

Canada has what is called a "duty to consult" indigenous groups when their rights may be affected by resource development projects that cut through their territories.

The more a project could affect indigenous rights, the higher the duty to consult, Canadian legal scholars have explained.

Chief Lee Spahan of the Coldwater Indian Band, a Nlaka'pamux Nation community in the BC interior and another applicant in the case, said contrary to the court's decision, Canada's consultation with his community was "not meaningful at all".

"It wasn't meaningful. Canada had their mindset already on this decision," Spahan said.

Coldwater chief Lee Spahan holds a feather at a briefing with other First Nations chiefs and Coast Salish drummers before Federal Court of Appeal hearings on the Trans Mountain Pipeline in Vancouver, British Columbia [File: Jennifer Gauthier/Reuters]

He said the decision states, however, that the pipeline route through the Coldwater area still has to be determined and that the project's potential risks to the community's drinking water source still need to be studied.

"The court has confirmed Canada has ongoing duty to consult with us on these very important issues," Spahan told reporters. "We will continue to stand strong and do everything in our power to ensure our sole source of drinking water is protected."

Khelsilem, a councillor and spokesman for the Squamish Nation said the community and its legal advisers would evaluate the court's decision and then decide on next steps.

"We will continue to fight to enforce our jurisdiction within our territories no matter what project that is because we have an absolute obligation to protect the interests for our people," he said.

Government welcomes decision

The Trans Mountain project has been an important source of contention with indigenous leaders, environmental groups and politicians at the federal, provincial and municipal levels coming out in opposition to the pipeline.

Canada has what is called a "duty to consult" indigenous groups when their rights may be affected by resource development projects.

The Federal Court of Appeal in August 2018 overturned an earlier approval of the project after it found that the government had "failed to meaningfully engage" with indigenous groups.

But in its decision on Tuesday, the court said it rejected the indigenous applicants' submissions, which it said "essentially [posited] that the project cannot be approved until all of their concerns are resolved to their satisfaction."

"If we accepted those submissions, as a practical matter there would be no end to consultation, the Project would never be approved, and the applicants would have a de facto veto right over it," the court said.

Prime Minister Justin Trudeau has insisted that the Trans Mountain pipeline is in the best interests of all Canadians and he has pledged to use the revenue generated by the pipeline to help "transition to a clean economy".

Trudeau has also promised to rebuild Canada's strained relationship with indigenous peoples.

His government welcomed the court's decision on Tuesday.

"I think what the court's decision says is that if you go about things the right way, if consultations are meaningful and in good faith and you roll up your sleeves and you do the work and listen ... you can get stuff done," Seamus O'Regan, Canada's minister of natural resources, told reporters.

The ruling was also celebrated by right-wing Alberta Premier Jason Kenney, a top backer of the Trans Mountain project. "Another win on the #TMX pipeline for Alberta!" he tweeted. "Now let's get it built."

A Trans Mountain sign warning of high-pressure petroleum [Jillian Kestler D'Amours/Al Jazeera]

Construction under way

Trans Mountain hailed the start of construction activities on the pipeline right of way in early December, just days before the Federal Court of Appeal hearings began.

The federal government also welcomed continuing construction on the Trans Mountain following the court's decision.

"We see this project as one that will enable us to get our resources to international markets," Bill Morneau, Canada's finance minister, told reporters on Tuesday.

"We also know of course that this is a project that can deliver significant economic benefit: economic benefit to Alberta, economic benefit to Canadians across the country."

But indigenous leaders, lawyers and economists have questioned the pipeline's viability.

In December, environmental advocacy groups launched a petition calling on the federal government to publish an updated cost analysis for the project.

"The Trans Mountain pipeline is already a massive multi-billion dollar subsidy and Canadians have the right to know how much the price has increased," Eugene Kung, staff lawyer at West Coast Environmental Law, said in a statement at the time.

"Canadians were told this would be a profit-generating investment and the profits would be devoted to renewable energy. Instead, it's operating at a consistent loss and it isn't even clear the government will be able to sell it, without taking another loss of billions of taxpayer dollars."

Leah George-Wilson, chief of the Tsleil-Waututh Nation, also said the Trans Mountain case raised questions about Canada's commitment to reconciliation with indigenous peoples.

"Is not reconciliation the most important item on the prime minister's agenda? Did he not say reconciliation was important and the most important relationship to him was with First Nations? Well, we need to see some of that now," George-Wilson told reporters on Tuesday.

"When we say that this project cannot go through, we are standing on our own indigenous law and on the path laid forward for us by our ancestors," she added.

"Tsleil-Waututh will always exercise every legal option that we have."