British Columbia Approves Kinder Morgan Pipeline Expansion

Reuters, January 13, 2017

British Columbia on Wednesday gave the green light to Kinder Morgan Inc's plan to nearly triple its Trans Mountain oil pipeline, which runs from Canada's oil sands through the province to a marine terminal on the Pacific Coast. British Columbia Premier Christy Clark said in a statement the C$6.8 billion ($5.16 billion) project had satisfied or was close to satisfying the five conditions she laid out in 2012 for any company wanting to build pipelines in the province.

The Canadian government in November approved Kinder Morgan's proposal to expand the Trans Mountain pipeline, which would help ensure oil exports from the oil sands in the neighboring province of Alberta reach Asia. Although inter-provincial pipelines fall under federal jurisdiction, if provinces are opposed they could impose conditions that would make it onerous for a company to build a pipeline. Environmental groups were swift to condemn the Western Canadian province's decision to approve the project, which comes four months before a provincial election.

"We expect that today's decision on the Kinder Morgan pipeline will come back to haunt Premier Clark when B.C. voters go to the polls," Sven Biggs of said.

"British Columbians will continue to fight this decision in the courts and on the streets well past next spring's election," he said.

Earlier on Wednesday, the province had given its approval to an environmental review of the project but recommended 37 conditions be attached to address concerns raised by communities and aboriginal groups. With the environmental approval, only two more approvals were outstanding on Trans Mountain: the province getting a "fair share" of jobs and economic benefits from the pipeline and a marine response plan to oil spills.

On getting its fair share, Clark said the province had struck an "unprecedented" agreement with Kinder Morgan under which the company would pay it up to C$1 billion in installments of between C$25 million and C$50 million a year over 20 years. The province was working closely with the Canadian government to have a "world-leading" marine spill response plan in place before the pipeline starts operations, which could be as early as December 2019, Clark said. Kinder Morgan welcomed the province's approval. The Texas-based company's board now has to make a final investment decision on the project. Construction is slated to start in September.


(Reporting by By Nicole Mordant; Editing by Bernard Orr and Chris Reese)

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