Screws turned on BC pipeline, LNG plans

City of Burnaby says Kinder Morgan filed insufficient pipeline expansion information; BC government under fire over water permits

Gary Park

For Petroleum News

The opposition keeps piling up against plans to export oil sands bitumen and LNG from the British Columbia coast.

Under the gun are Kinder Morgan’s plans to almost triple capacity on its Trans Mountain pipeline system to 890,000 barrels per day and both the British Columbia government and natural gas producer Encana, which could be one of the leading sources of gas for LNG.

Three months after submitting an application to Canada’s National Energy Board to add 590,000 bpd of crude bitumen to its plans for twinning the Trans Mountain system, Kinder Morgan is being accused of failing to provide sufficient information in its filing on how it will handle pipeline spills or what environmental impact the C$5 billion will have.

The City of Burnaby — a city of 250,000 within the Greater Vancouver region — initiated the complaint on behalf of its residents, who live alongside the Westridge Marine Terminal and storage tanks in Port Metro Vancouver.

It said Kinder Morgan’s plan lacks critical details, including safety measures and a clear indication of what route it will take through the city.

Greg McDade, the city’s attorney, requested that the initial application be rejected, arguing residents have been led to believe that the new pipeline will follow the existing right of way in Burnaby when 90 percent will follow one of two possible new routes.

He said the project involves major expansion of a tank farm to store 15 million barrels of crude for loading on tankers.

Burnaby Mayor Derek Corrigan said the company has been less than candid about its safety record.

He said Kinder Morgan claims Trans Mountain has been operated safely for 60 years, when more than one spill has occurred in Burnaby, the latest happening in 2007 when 1,500 barrels spilled, damaging a neighborhood and a fish habitat and costing C$15 million to clean up.

Two contractors and Trans Mountain eventually pleaded guilty to 21 charges in a British Columbia court.

“Kinder Morgan’s application is incomplete, which makes it impossible to know the extent of the impacts the pipeline would have on our city,” Corrigan said in a release.

Government charged

The suits filed in the British Columbia Supreme Court target the use of hydraulic fracturing, which they claim is linked to problems such as water pollution, and requested that permits issued to Encana be withdrawn.

Under provincial water legislation, companies that need fresh water for their operations can either apply for a long-term water permit or seek short-term approval for a term of up to two years.

Karen Campbell, an attorney for the environmental groups, said that obtaining a full license requires people who are potentially affected to be notified and given the chance to provide input or submit objections.

The short-term approvals can be issued by the British Columbia Oil and Gas Commission, which has the option to keep renewing the same licenses, allowing companies to use thousands of gallons of water without facing a full-scale hearing.

Campbell said any company planning to use water beyond two years should only be allowed to do so through licenses.

She said her groups have discovered that 83 percent of short-term permits were renewed at least once, some as many as six times.

Encana said 82 of those 83 approvals involved drawing water from excavated pits that collect water naturally, rather than from lakes, rivers or streams.

The government countered that its officials have acted within the terms of the Water Act, which “contains no express prohibition on repeats of approvals.”

It is also planning a major overhaul of its water legislation, including the right to issue consecutive short-term approvals to the same company.