An oil tanker passes through the Second Narrows loaded with oil from the Kinder Morgan pipeline. The current 30 to 70 tankers that load at Burnaby's Westridge Terminal each year is expected to climb to about 300 if a pipeline twinning is approved.

An oil tanker passes through the Second Narrows loaded with oil from the Kinder Morgan pipeline. The current 30 to 70 tankers that load at Burnaby's Westridge Terminal each year is expected to climb to about 300 if a pipeline twinning is approved.

Oil pipeline application opens attack window for critics

Kinder Morgan seeks approval of tolls for its customers, triggers early hearings

Opponents of Kinder Morgan’s plan to twin its oil pipeline through the Lower Mainland intend to use regulatory hearings over the business terms with oil customers as an arena to raise broader concerns.

Kinder Morgan Canada president Ian Anderson on Friday announced the company  has applied to the National Energy Board for approval of the tolls and terms for nine major shippers who have signed on to 20-year secure contracts.

Hearings for the toll application will proceed ahead of later NEB hearings on the actual expansion project, for which the company expects to file an NEB application in late 2013.

Anderson stressed the initial application has nothing to do with the construction or the 1,150-kilometre route of the $4-billion oil pipeline from Edmonton to Burnaby, which would be the subject of the 2013 application after extensive study, community consultation and design work.

But NDP associate natural resources critic Kennedy Stewart said the first set of hearings offer an early chance for the public to have their say.

The federal NDP will register as intervenors, the Burnaby-Douglas MP said, adding he expects local cities, interest groups and land owners may do so as well.

“It is the first time we’re going to start getting details about this pipeline,” he said.

“It’s such a massive project we have to get involved at all stages.”

Stewart said intervenors could ask the NEB to increase the toll rates Kinder Morgan will charge its customers to provide extra insurance coverage against a pipeline breach or oil tanker spill.

Likewise, he said, a surcharge on tolls could cover payments to First Nations.

The hearings could also shed light on the future of Chevron’s Burnaby refinery, which critics say could be threatened if it has to pay more for crude oil carried by Kinder Morgan to match the prices the oil fetches in Asia.

Chevron is not among the nine firms Kinder Morgan plans to guarantee secure access to 80 per cent of the expansion volume, but it is seeking priority access to the pipeline’s remaining capacity, ahead of other spot buyers.

Stewart said he wants to see if Chevron registers as an intervenor to fight Kinder Morgan’s toll application.

The loss of the Burnaby refinery would drive Lower Mainland gas prices sharply higher, he warned, because Chevron could no longer supply its stations at lower cost, which other outlets are currently forced to match.

“Chevron’s already being outbid by foreign customers for the existing oil coming down the pipeline,” Stewart said.

“Their supply is being curtailed to the point where it’s cheaper for them to truck in crude oil to be refined. Eventually, if that becomes too expensive, the refinery will close.”

An industry observer this week also speculated Chevron could sell the refinery to Husky, which is among the firms in line for long-term access.

Anderson said he believes Chevron will have sufficient spot market access to the pipeline to supply the Burnaby refinery.

He said the pipeline’s shift to providing access by long-term contract is a fundamental change and it was prudent to seek separate NEB approval to verify the economic underpinnings of the project before moving ahead with detailed work.

It was not an attempt to short-circuit public comment on the pipeline or shorten the later regulatory process on the route, he added.

“We’re not changing at all our commitment process to the proposed expansion.”

Twin pipelines carrying heavier oil sands crude as well as lighter petroleum products are expected to increase the Trans Mountain pipeline’s capacity from 300,000 barrels per day now to 750,000 by 2017.

That would bring about 300 oil tankers a year through Burrard Inlet to load at the Westridge Terminal in Burnaby.

More than 500,000 barrels per day of capacity is now committed to long-term buyers, Anderson said, adding they have signed on the basis of export via the size of tankers that now come to Burnaby, not a larger tanker class that would require dredging of the Second Narrows by Port Metro Vancouver.

Groups opposed to the pipeline expansion also intend to watch the initial set of hearings to see if public access is curtailed as a result of the approval process streamlining passed by the federal government in Bill C-38.

 

Long-term deals

Firms that have signed on to 20-year supply contracts through the expanded Trans Mountain pipeline include:

  • BP Canada Energy Trading Company
  • Canadian Oil Sands Limited
  • Cenovus Energy Inc.
  • Devon Canada Corporation
  • Husky Energy Marketing Inc.
  • Imperial Oil Limited
  • Nexen Marketing Inc.
  • Statoil Canada Ltd.
  • Tesoro Canada Supply & Distribution Ltd.

Just Posted

An example of the forest land in the Port Renfrew and Fairy Creek area of Vancouver Island is shown on May 11, 2021. THE CANADIAN PRESS/Jen Osborne
Old-growth logging opponents launch hunger strike as arrests continue at Fairy Creek

Zain Haq says the hunger strikers will gather today at Burrard Street in downtown Vancouver

The City of Victoria is hoping to ring in the summer by celebrating local art and offering some distanced, live music to surprise people in parks, plazas and other public spaces. (Photo courtesy of the City of Victoria)
Live, pop-up concerts and local art being showcased in Victoria this summer

People will see surprise serenades at 16 locations throughout the summer

An example of the forest land in the Port Renfrew and Fairy Creek area of Vancouver Island is shown on May 11, 2021. THE CANADIAN PRESS/Jen Osborne
Old-growth logging opponents launch hunger strike as arrests continue at Fairy Creek

Zain Haq says the hunger strikers will gather today at Burrard Street in downtown Vancouver

The 14th annual Oak Bay Young Exceptional Star (YES) awards June 3. (Christine van Reeuwyk/News Staff)
Oak Bay celebrates its Young Exceptional Stars with outdoor award ceremony

Nine young people recognized in 14th annual awards

Jada Benwell and Connor Larkey are the valedictorians of the 2021 graduating class at Parkland Secondary School. (Wolf Depner/News Staff)
Pandemic taught lessons in perseverance for North Saanich high schoolers

Parkland Secondary School to release 2021 grad ceremony video on June 25

Canadian Prime Minister Justin Trudeau participates in a plenary session at the G7 Summit in Carbis Bay, England on Friday June 11, 2021. THE CANADIAN PRESS/Adrian Wyld
Canada donating 13M surplus COVID-19 vaccine doses to poor countries

Trudeau says the government will pay for 87 million shots to be distributed to poor countries

Premier John Horgan speaks as provincial health officer Dr. Bonnie Henry, right, and health minister Adrian Dix look on during a press conference to update on the province’s fall pandemic preparedness plan during a press conference from the press theatre at Legislature in Victoria, Wednesday, Sept. 9, 2020. THE CANADIAN PRESS/Chad Hipolito
B.C. officials to provide details on Step 2 of COVID reopening plan Monday

Step 2 could allow for larger gatherings and a resumption of recreational travel

Indigenous Services Minister Marc Miller is seen during a news conference, Wednesday May 19, 2021 in Ottawa. THE CANADIAN PRESS/Adrian Wyld
Indigenous child-welfare battle heads to court despite calls for Ottawa to drop cases

Feds are poised to argue against two Canadian Human Rights Tribunal rulings

The Great Ogopogo Bathtub Race has been held in Summerland as a fundraising event. Do you know which Canadian city introduced this sport? (Black Press file photo)
QUIZ: A summer’s day at the water

How much do you know about boats, lakes and water?

Two-year-old Ivy McLeod laughs while playing with Lucky the puppy outside their Chilliwack home on Thursday, June 10, 2021. (Jenna Hauck/ Chilliwack Progress)
VIDEO: B.C. family finds ‘perfect’ puppy with limb difference for 2-year-old Ivy

Ivy has special bond with Lucky the puppy who was also born with limb difference

A million-dollar ticket was sold to an individual in Vernon from the Lotto Max draw Friday, June 11, 2021. (Photo courtesy of BCLC)
Lottery ticket worth $1 million sold in Vernon

One lucky individual holds one of 20 tickets worth $1 million from Friday’s Lotto Max draw

“65 years, I’ve carried the stories in my mind and live it every day,” says Jack Kruger. (Athena Bonneau)
‘Maybe this time they will listen’: Survivor shares stories from B.C. residential school

Jack Kruger, living in Syilx territory, wasn’t surprised by news of 215 children’s remains found on the grounds of the former Kamloops Indian Residential School

A logging truck carries its load down the Elaho Valley near in Squamish, B.C. in this file photo. THE CANADIAN PRESS/Chuck Stoody
Squamish Nation calls for old-growth logging moratorium in its territory

The nation says 44% of old-growth forests in its 6,900-square kilometre territory are protected while the rest remain at risk

Most Read