Canada approves new pipelines to boost exports, greens ready to fight

Tue Nov 29, 2016 6:10pm EST
 
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By David Ljunggren and Leah Schnurr

OTTAWA (Reuters) - Canada on Tuesday approved Kinder Morgan Inc's hotly contested plan to twin a pipeline from the Alberta oil sands to the Pacific coast, setting up a battle with environmentalists who helped elect Prime Minister Justin Trudeau.

The government, under pressure from both green groups and the energy industry, said allowing Kinder Morgan to build a second pipeline next to its existing Trans Mountain line will help ensure oil exports reach Asia and reduce reliance on the U.S. market.

"Our duty is to permit infrastructure so Canada's resources get to market in a more environmentally responsible way, creating jobs and a thriving economy," Trudeau told a news conference, adding he was "under no illusions" that the Kinder Morgan decision would be bitterly disputed.

The government blocked Enbridge Inc's Northern Gateway pipeline from Alberta to the Pacific Coast, as expected. Trudeau had long opposed the project, which would run through the Great Bear Rainforest.

Enbridge, however, will be allowed to replace the Canadian segments of its ageing Line 3 from Alberta to Wisconsin. The proposed upgrade had been less controversial than Northern Gateway project. Enbridge said it expected the pipeline to enter service in 2019, pending U.S. regulatory approval.

Canada's energy sector, hit hard by a two-year slump in oil prices, wants more pipelines to help ease bottlenecks in moving crude out of Alberta. Canada, home to the world's third-largest crude reserves, wants to diversify away from its reliance on the United States and into Asian markets.

Kinder Morgan's C$6.8 billion ($5.06 billion) project would nearly triple capacity on the artery to 890,000 barrels a day.

""We are getting a chance to break our landlock. We're getting a chance to sell to China and other new markets at better prices," Alberta Premier Rachel Notley said in a statement.   Continued...

 
A tanker docks at Westridge Terminal, the loading area for Kinder Morgan's Trans Mountain pipeline in Burnaby, British Columbia, Canada in a May 10, 2013 file photo. Kinder Morgan Canada/Handout via REUTERS