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.
Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Saanich police officers were one group of dozens that submitted dance clips to the Greater Victoria Festival Society, to help create the Dance Across Victoria video montage. (Youtube/Screenshot)
WATCH: Saanich police, Victoria mayor bust some moves in new Dance Across Victoria video

Montage features submitted dance clips from across Greater Victoria

Saanich’s Malia Brodie competed in the Vancouver qualifiers for the 2020 National Championships. (Photo by BC Sport Karate Snaps)
PHOTOS: Saanich teen awarded $1,800 Karate Canada bursary to pursue officiant certification

Malia Brodie, 18, has black belt, nearly 15 years experience in karate

Former Oak Bay High Grade 12 student Brandon Kip plays the $100,000 Steinway piano in the Dave Dunnet Theatre. (Black Press Media file photo)
Oak Bay High Alumni Association passes torch to new president

The association has given back more than $70,000 in its 16 years

After more than a year, open forums will resume at a Saanich committee of the whole meeting on April 19 with up to five residents having the chance to speak for three minutes each about any district-related matter. (Black Press Media file photo)
Public input resumes at Saanich council following lengthy suspension due to pandemic

Up to five residents can present by phone for up to three minutes starting April 19

Sooke pickleball enthusiasts are rallying for funds to resurface the local outdoor courts. The group will come before council on April 13, where they will request for $7,000 towards the resurfacing project. (Photo from Sooke Pickleball Facebook page)
Sooke pickleball enthusiasts push for outdoor court resurfacing

Group to come before Sooke council April 13, asking for $7,000 grant

Vancouver resident Beryl Pye was witness to a “concerning,” spontaneous dance party that spread throughout social groups at Kitsilano Beach on April 16. (Screen grab/Beryl Pye)
VIDEO: Dance party erupts at Vancouver’s Kitsilano Beach to the dismay of onlookers

‘It was a complete disregard for current COVID-19 public health orders,’ says Vancouver resident Beryl Pye

Deputy Prime Minister and Minister of Finance Chrystia Freeland responds to a question during Question Period in the House of Commons Tuesday December 8, 2020 in Ottawa. The stage is set for arguably the most important federal budget in recent memory, as the Liberal government prepares to unveil its plan for Canada’s post-pandemic recovery even as a third wave of COVID-19 rages across the country. THE CANADIAN PRESS/Adrian Wyld
Election reticence expected to temper political battle over federal budget

Opposition parties have laid out their own demands in the weeks leading up to the budget

A syringe is loaded with COVID-19 vaccine at a vaccination clinic run by Vancouver Coastal Health, in Richmond, B.C., Saturday, April 10, 2021. THE CANADIAN PRESS/Jonathan Hayward
B.C. to open up COVID vaccine registration to all B.C. residents 18+ in April

Registration does not equate to being able to book an appointment

Pat Kauwell, a semi-retired construction manager, lives in his fifth-wheel trailer on Maxey Road because that’s what he can afford on his pension, but a Regional District of Nanaimo bylaw prohibits using RVs as permanent dwellings, leaving Kauwell and others like him with few affordable housing options. (Chris Bush/News Bulletin)
Rules against RV living hard on Island residents caught in housing crunch

Regional District of Nanaimo bylaw forcing pensioner to move RV he calls home off private farm land

(Black Press file photo).
UPDATED: Multiple stabbings at Vancouver Island bush party

Three youths hospitalized after an assault in Comox

Selina Robinson is shown in Coquitlam, B.C., on Friday November 17, 2017. British Columbia’s finance minister says her professional training as a family therapist helped her develop the New Democrat government’s first budget during the COVID-19 pandemic, which she will table Tuesday. THE CANADIAN PRESS/Darryl Dyck
B.C. finance minister to table historic pandemic-challenged deficit budget

Budget aims to take care of people during pandemic while preparing for post-COVID-19 recovery, Robinson said

Each spring, the Okanagan Fest-of-Ale is held in Penticton. This year, as a result of the COVID-19 pandemic, the festival will not be held. However, beer is still available. How much do you know about this beverage? (pxfuel.com)
QUIZ: How much do you really know about beer?

Put your knowledge to the test with this short quiz

Lord Tweedsmuir’s Tremmel States-Jones jumps a player and the goal line to score a touchdown against the Kelowna Owls in 2019. The face of high school football, along with a majority of other high school sports, could significantly change if a new governance proposal is passed at the B.C. School Sports AGM May 1. (Malin Jordan)
Power struggle: New governance model proposed for B.C. high school sports

Most commissions are against the new model, but B.C. School Sports (BCSS) and its board is in favour

Most Read