Alberta Premier Jason Kenney is warning the Senate against passing the federal Liberal government's environmental assessment bill in its current form, saying it risks inflaming a burgeoning national unity "crisis" in his province.

In an appearance before the upper house's energy committee Thursday, Kenney said Ottawa's attempt to rewrite existing assessment legislation, do away with the National Energy Board and bolster Indigenous participation in the approvals process — among many other changes to the natural resources regime — creates uncertainty for an industry that is facing constrained pipeline capacity and cratering commodity prices.

"There is a growing crisis of national unity in Alberta which would be exacerbated by the adoption of this bill and other policies like it," Kenney said. "If this bill proceeds, it will be a message to the people of Alberta that their federal government doesn't care about a devastating period of economic adversity in our province."

Kenney said he is prepared to launch a constitutional legal challenge against the legislation if it is passed by the Senate as written, saying Ottawa is unfairly intruding on an area of provincial jurisdiction.

He said former Alberta premier Peter Lougheed signed onto the Constitution Act of 1982 only because of guarantees in section 92(a), the so-called "resource amendment," which gives provinces exclusive jurisdiction for some policies related to non-renewable resources, and this bill violates those provisions.

Kenney tells a House of Commons committee that the Liberals' pipeline bill would 'be a disaster for the Canadian economy and will seriously rupture national unity." 1:26

Kenney said Ottawa's proposed draft regulations, released Wednesday, are a "flagrant" violation of section 92(a) because they propose to put "in situ" oilsands on the projects list for federal environmental assessments and exempt them only if the province maintains a hard cap on emissions from the oilpatch.

"These are exclusively within Alberta territory and they relate to the production of natural resources. There is no rational person who can see, under section 92(a), a federal interest to regulate that. It would be a blatant violation of the Constitution. The federal government is asking you to violate the Constitution of Canada in adopting this bill and that's why, should it proceed in its current form, we'll see the federal government in court," Kenney said.

In situ projects, which use steam to extract crude from deep under the earth rather than open-pit mining, generally have a much smaller environmental footprint and use considerably less water. To this point, environmental reviews for these sorts of projects have been the exclusive jurisdiction of the Alberta Energy Regulator.

The Canadian Association of Petroleum Producers (CAPP) has also expressed anxiety about the risk of regulatory creep and the prospect of Ottawa applying its jurisdiction to projects that have operated solely under the purview of the province.

"You can't exempt something when you don't have the right to regulate it in the first place," Alberta Energy Minister Sonya Savage said Thursday.

Alberta Premier Jason Kenney and provincial Energy Minister Sonya Savage, right, prepare to appear at the standing Senate committee on energy, the environment and natural resources on Parliament Hill in Ottawa on Thursday. (Justin Tang/Canadian Press)

When asked what he thought of Ottawa's pledge to exempt in situ projects from federal review as long as Kenney maintains an overall emissions cap, Kenney said the promise doesn't make the bill any less unconstititutional in his view.

"I think that proviso does nothing to mitigate a clear violation of section 92(a). I think it's beyond presumptuous for the federal government," he said.

While uneasy with tying a regulatory process to an emissions cap, Kenney said his government has no immediate plans to do away with the 100-megatonne cap designed by former premier Rachel Notley — a limit the sector is in no danger of exceeding.

"My government has no intention of changing that. But we do believe that this makes no sense. Only Canada would cap its production and potential prosperity. We don't see Russia, Saudi Arabia, Qatar doing the same thing," he said.

The federal government defended its legislation as a way to fix a broken assessments process that has failed to see a major pipeline built to tidewater.

When asked about Kenney's assertion that the federal government doesn't have jurisdiction to review in-situ projects built in Alberta, Environment Minister Catherine McKenna said regulating greenhouse gas emissions falls under shared federal and provincial jurisdiction — an argument the federal government has used in ongoing court cases brought against the federal carbon tax.

"This is all about setting better rules. I think it's unfortunate to use inflammatory language to foster polarization," McKenna said of Kenney's separatism talk. "And let's be clear the environment is squarely an area of joint jurisdiction. The Supreme Court has been clear about that."

The current environmental regime is the one that was used to assess the Trans Mountain expansion project, McKenna said, and that multi-year battle to build is hardly a process that should be emulated.

She said the assessment process as outlined in Bill C-69 includes more accommodation for Indigenous and environmental concerns so that projects can avoid future court challenges.

"The current system is a broken system that has let good projects languish," McKenna said. "Better rules will improve investor confidence and strengthen our economy. These rules rely on science ... increase transparency, rebuild public trust, and will protect our environment."

Prime Minister Justin Trudeau meets with Alberta Premier Jason Kenney in his office on Parliament Hill in Ottawa on Thursday, May 2, 2019. (Sean Kilpatrick/Canadian Press)

Natural Resources Minister Amarjeet Sohi said he wants to see "earlier and regular engagement" with Indigenous communities to ensure their rights are properly respected through meaningful consultations on major natural resources projects. "The consequences of not fixing the system are simply too great," the Edmonton-area minister said.

He said he understands the current pipeline paralysis has caused anxiety in his home province but the government is confident Bill C-69 will create a new more workable regime to help see projects through to completion.

"I rarely hear my constituents talking about separation or leaving Canada. I think it's irresponsible for anyone to suggest that Alberta leave the Confederation. Yes, we have challenges and we're working hard to fix those challenges," he said.

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