Canada’s Trans Mountain Pipeline Set To Expand
Canada’s Trans Mountain pipeline, a key component in transporting oil from Alberta to the coast in British Columbia since 1953, is set to double in carrying capacity thanks to a decision from the Canadian government to proceed with a proposed expansion. The pipeline decision was originally scheduled for later in December, but Prime Minister Justin Trudeau decided to make the announcement early ahead of meetings with premiers from the Canadian provinces. The expansion promises to raise the carrying capacity of the pipeline to almost 900,000 barrels of oil per day.
According to the Trans Mountain website, the project will cost $6.8 billion, will only need to create new right of ways over 11 percent of the route, and will be operational by 2019. The new pipeline is designated to carry heavy crude products with the capacity to transport light crude, while the existing line will carry refined oil, synthetic products, and light crude. Overall, the project will create just short of 1,000 kilometers of new pipeline for Canada’s oil industry.
Other benefits of the expansion, according to the Trans Mountain website, are improvements in the Westridge Marine Terminal in Burnaby, as well as more storage capacity with more tanks, and new pumping stations along the route. Environmentalists have opposed the expansion on the grounds that it further endangers the climate. Local leadership among native peoples have stated that they did not consent to the decision, and some believe that without that consensus, the project cannot proceed. Many are concerned about the potential dangers associated with the Trans Mountain pipeline expansion on tribal lands.
The expansion westward for Canada’s oil industry coincides with protests in the United States against a pipeline scheduled to be built across tribal lands in North Dakota. The decision ends Canada’s discussion of the Northern Gateway pipeline proposal, but also gave the go-ahead for a $7.5 billion pipeline expansion from Alberta to Wisconsin. Trudeau also claims that the new Trans Mountain pipeline expansion is a boon to the economy, creating over 15,000 new jobs and opening new markets for Canada’s oil.
While local elected officials in Alberta celebrate the economic prospects of the pipeline, many tribal leaders in the path of the proposed expansion object to the decision. Those leaders are promising to challenge the pipeline in court, and are prepared for a long battle. No protests were scheduled as yet. As a part of the agreement, Alberta is set to raise its carbon tax rate to offset the expansion.
Another critical aspect of the proposal, according to the government, is that Canada plans to place a moratorium on oil shipments off the North Coast of British Columbia. The government claims that doing this will reduce the threat of a shipping accident in the crowded shipping lanes. The initial expansion proposal failed in a local vote in 2014.
Unlike the Keystone XL pipeline, the expansion of the Trans Mountain pipeline will not require a presidential approval, as it is an expansion. The National Energy Board of Canada approved the project and stated that it was in the national interest. It also recommended a large slate of safety precautions to mitigate potential environmental impact.
The Conference Board of Canada believes that the pipeline will return triple the initial investment in revenue over the next two decades. Proponents of the expansion also tout the benefits of increasing oil flow to the West Coast to open new markets. Doing so could increase the chances of making inroads into China, as well as other smaller markets in Asia and the Pacific Rim. With the U.S. set to abandon its position in the Trans Pacific Partnership, Canada could make inroads into Asian markets in many industries, and a larger supply of oil with which to bargain could set the country on solid trade footing.
[Featured Image by Greg A. Syverson/Getty Images]
