Asia will be the prized customer for crude oil in Kinder Morgan Canada Inc.’s plans to nearly triple its Trans Mountain pipeline capacity from Edmonton to the West Coast.
The current oil pipeline stretches 1,150 kilometres, and Kinder Morgan Canada filed a massive application on Monday to the National Energy Board to seek approval for its planned $5.4-billion line that would boost the total capacity to 890,000 barrels a day. More than 15,000 pages contained in 37 binders that stack up more than two metres high have been submitted to the NEB.
Twinning the existing Trans Mountain pipeline would be an attractive way for Canada to diversify its oil exports, especially as the United States reduces its reliance on imported oil, energy industry leaders say.
Trans Mountain has a capacity of 300,000 barrels a day. An estimated 21 per cent of the oil shipments last year went to Kinder Morgan Canada’s Westridge marine terminal on the shores of Burrard Inlet, while most of the rest was delivered to refineries in British Columbia and Washington state.
The extra 590,000 barrels of day in expansion plans would be primarily heavy oil and destined for loading onto tankers, many bound for Asia.
Currently, five oil tankers a month sail past picturesque sites such as Vancouver’s Stanley Park to get to the Westridge dock. Kinder Morgan is seeking to increase the number of tankers docking at the terminal to 34 a month, up from five. The Opposition B.C. New Democratic Party, First Nations leaders, environmentalists and the mayors of Vancouver and Burnaby have opposed the expansion.
But Kinder Morgan Canada president Ian Anderson said the project will generate benefits for federal, provincial and municipal governments. “We’re not the exporter. We load the tanker. Where it ultimately ends up is really a matter for the shipper or the marketer or the refiner to determine,” he said during a conference call. “But the majority of the expansion is destined for our dock. And the majority of that will be going to Asia or California, off our Westridge dock.”
Canada needs to find new oil markets because virtually all of the country’s oil exports go to the U.S., the Canadian Association of Petroleum Producers said in a statement, noting that “rapidly growing markets in Asia” would help Canada capture world prices for oil.
“Bolstered market access for Canada’s energy is critical to create jobs and provide economic benefits for all Canadians,” CAPP vice-president Greg Stringham said. “The Trans Mountain project expands an existing pipeline that has provided needed energy to North Americans safely and securely for almost 60 years.”
Brenda Kenny, president of the Canadian Energy Pipeline Association, said many regulatory hurdles still need to be cleared. A 15-month NEB review process will be the next step.
Seventy-three per cent of the proposed new routing will follow existing rights-of-way. About 980 kilometres of new pipe would need to be constructed.
“We’ll continue to reach out to interested groups, including the City of Vancouver, with information and with an openness to hear issues,” Mr. Anderson said. He emphasized that consultations over the past 18 months have covered landowners, First Nations and communities along the proposed expansion route.
Kinder Morgan Canada’s application comes days before a federally appointed joint review panel rules on Enbridge Inc.’s proposed Northern Gateway oil pipeline project.
Keith Stewart, Greenpeace Canada’s climate and energy campaign co-ordinator, said Kinder Morgan Canada is setting itself up to be the oil export pipeline of choice, especially should Northern Gateway get rejected or falter. “But both pipeline proposals would put the West Coast at risk of oil spills and deepen our addiction to dirty oil and fuel climate change,” Mr. Stewart said.
Federal Natural Resources Minister Joe Oliver said the Trans Mountain application “will undergo a thorough, science-based review by the independent National Energy Board, taking into account the safety of the public and the environment.”Report Typo/Error