http://business.financialpost.com/2014/06/03/kinder-morgans-once-surefire-trans-mountain-plan-now-struggling-against-overwhelming-opposition/
Kinder Morgan’s once surefire Trans Mountain plan now struggling against
‘overwhelming’ opposition
[Let's see. The Canadian pipeline/bitumen industry gamed the Joint
Review Panel on the Northern Gateway pipeline to the point the JRP did
not follow its own guidelines, nor observe federal law in its zeal to
approve the deal. Now, we learn that Kinder Morgan - like TransCanada
Pipeline for the Energy East proposal - has included a bait and switch
in their proposal - post one capacity for approval, but include a larger
value as a potential future capacity, both under the same approval
process. Couple that with a 'world-class' label for a clearly deficient
oil response capability and an actual response plan 'to be provided
later' in the case of Northern Gateway, and it seems eminently logical
that the citizens are concerned about the track record, proposals and
motivations.]
Jeff Lewis | June 3, 2014 | Last Updated: Jun 3 8:04 PM ET
CALGARY — Ian Anderson, president of Kinder Morgan Canada, expected
questions and concerns about oil-spill response capabilities, tanker
safety and pipeline routing when the Canadian unit of the Texas-based
company applied last year to triple capacity on its Trans Mountain pipeline.
What caught him and the company off guard, he said Tuesday, is the
degree to which politics has played a role in shaping public opinion
about the $5.4-billion expansion project.
“Sometimes the political voice is held out to represent public opinion
and other times it influences public opinion, so sorting through that
has been one of the more difficult aspects of the past year,” he said in
an interview at the company’s Calgary headquarters.
The plan to build a second, 540,000-barrel-per-day pipeline from
Edmonton to the Vancouver region will increase capacity on the Trans
Mountain system to 890,000 barrels daily, from its current design of
300,000.
Once a viewed by industry as a slam-dunk proposal to open potentially
vast new markets in Asia for fast-growing oil sands production, the
expansion now faces some of the same resistance that has threatened the
viability of rival projects, from TransCanada Corp.’s Keystone XL to
Enbridge Inc.’s contentious Northern Gateway.
A Bloomberg News poll this week said 34% of B.C. residents want the
federal government to block Gateway, while 33% want the project sent
back to regulators for further review. Twenty-nine per cent of 500
residents polled in the telephone survey said it should be approved. A
decision on the project is due this month.
Mr. Anderson said there is strong support in the westernmost province
for oil pipelines and energy infrastructure. “They tend to be quieter.
They tend to be less active” than opponents, he said.
Kinder Morgan has nevertheless struggled with the “overwhelming”
interest in its plan, he said. The company last week asked regulators
for more time to respond to requests by participants seeking additional
information about the proposal.
Company officials said they would file responses Wednesday to questions
posed by 60 of 117 interested parties with so-called “intervenor” status
in the proceedings; the rest will get answers by June 18, two weeks
after an original deadline of June 4.
Mr. Anderson said the company is fielding a dizzying array of questions
from regulators, municipalities and various levels of government.
The B.C. City of Burnaby is home to an oil-storage facility and loading
dock that serves ocean-going tankers. It has asked 1,700 questions
seeking information about the company’s emergency response plans, he
said. The City of Vancouver has asked 400 questions of its own, on top
of 300 detailed queries from federal agencies and another 300 from
regulators.
“I’ve got 60 people working around the clock trying to respond to that
volume,” Mr. Anderson said.
Whether the answers mollify critics is an open question.
Thirteen large oil sands producers, including Suncor Energy Inc.,
Cenovus Energy Inc. and Husky Energy Inc., have signed up to ship crude
on the expanded system. Mr. Anderson said the company has also forged
relationships with communities along the pipeline route — it is close to
finalizing three contracts for integrity work with First Nations-led
corporations, he said.
But key players remain opposed to the project. The Tsleil Waututh First
Nation, which claims much of Burrard Inlet as traditional territory,
refuses to meet with the company, as do Burnaby city staff.
Mr. Anderson said Kinder Morgan has also been stymied in efforts to meet
with the city’s fire department, which has raised concerns about the
risks of more than doubling oil-storage capacity at an existing facility
on Burnaby Mountain. Burnaby Mayor Derek Corrigan confirmed the
municipality has not met with the company since it submitted its
application in December.
The Financial Post has reported Kinder Morgan is designing the pipeline
expansion with room to potentially add another 240,000-barrels-per-day
of capacity over and above what’s proposed.
Mr. Anderson played down such a scenario, calling the option
“theoretical” and dependent on commercial support and further regulatory
work. “We haven’t assessed it yet,” he said, adding the company is
focused on what’s on its plate today.
Under federal rules, the National Energy Board must make a
recommendation on the project to the Governor-in-Council by July 2015.
If it’s approved, Mr. Anderson said Kinder Morgan would not follow
Enbridge’s tack and delay construction in a bid to win over opponents.
“My objective is to have as shovel-ready a project as I possibly can,”
he said.
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