Canada regulatory board greenlights Trans Mountain pipeline

AP News
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Posted: May 19, 2016 6:04 PM

VANCOUVER, British Columbia (AP) — Canada's energy regulator on Thursday recommended the approval of Kinder Morgan Canada's plan to expand the Trans Mountain oil pipeline, subject to dozens of conditions.

Kinder Morgan wants to triple the capacity of its existing Trans Mountain pipeline, which carries diluted bitumen from oil sands near Edmonton to Burnaby, British Columbia for export. The US$5.9 billion (CA$6.8-billion) Trans Mountain pipeline expansion would bring capacity to 890,000 barrels a day.

The regulator's positive recommendation has cleared a major hurdle for the project, with Prime Minister Justin Trudeau's cabinet set to make a final decision by the end of the year.

But Kinder Morgan would have to address 157 environmental, safety and financial conditions, including holding $1.1 billion in liability coverage and detailing its plans to protect endangered species. The board said the project is the first to be required to detail plans for offsetting emissions.

There was fierce opposition to the project and the process throughout the energy board's hearing, with the British Columbia government and cities of Vancouver and Burnaby opposing the expansion.

Environmental groups said they weren't surprised by the decision.

"This is exactly what we expected from the National Energy Board, an industry-captured regulator that never met a pipeline it didn't like or environmental impact it couldn't ignore," Larissa Stendie of the Sierra Club said in a statement.

But the board concluded the project presents significant benefits to Canada, including increased access to diverse markets for Canadian oil, thousands of construction jobs and hundreds of long-term jobs, development opportunities for indigenous and local communities and considerable government revenues.

Canada has the third largest reserves of oil after Saudi Arabia and Venezuela but 97 percent of its oil exports go to the United States and Canada is eager to diversify.

Kinder Morgan said in a statement it was "pleased" the board had recommended approval of the project.

Peter McCartney, a climate campaigner with the Wilderness Committee, said the project has no social license and will not be built.

"I shouldn't be surprised, but this is an outrageous decision. The National Energy Board has ignored and wasted the time of countless communities, First Nations and individuals who have stood up to oppose this irresponsible pipeline proposal," he said in a statement.