September 18, 2014 / 3:13 AM / 3 years ago

British Columbia court rejects bid to block Kinder Morgan pipeline

VANCOUVER (Reuters) - The Supreme Court of British Columbia has rejected a local municipality's bid for a temporary injunction to stop survey work for an oil pipeline expansion project proposed by Kinder Morgan Energy Partners KMP.N.

Justice Brenda Brown issued her decision on Wednesday, but her written reasons will not be released until next week.

Burnaby mayor Derek Corrigan said he was "disappointed and frustrated" by the court's decision but said the municipality will continue to push for a permanent injunction.

"We are considering whether or not we want to appeal the interim injunction denial," he said. "We won't know that until we see the reasons sometime next week."

The court case is the latest in a long-running battle between the City of Burnaby, part of Metro Vancouver, and Kinder Morgan over the Texas-based company's plans to nearly triple the capacity of its Trans Mountain crude pipeline to 890,000 barrels per day.

The company wants to twin the pipeline, which was built in 1953 and runs from the oil sand hub of Edmonton to its marine terminal in Burnaby. But the city, which has grown into a major urban center over the last 60 years, is opposed to the plan.

While much of the new line would run along the existing right-of-way, the company has changed its preferred route through Burnaby and now wants to run a key segment under Burnaby Mountain, a local conservation site.

City officials and crews hired by Kinder Morgan clashed last week over whether the company was allowed to cut down a handful of trees on the mountain to do survey work for the new route.

The company said it had been granted permission to carry out the work by Canada's energy regulator, the National Energy Board (NEB), while the city argued it was against municipal law and blocked access to the site.

Burnaby then asked the court for an injunction to block any work that would disrupt parkland. The pipeline company responded by asking the NEB to prevent the city from stopping its crews.

The Trans Mountain expansion is supported by Canada's oil producers, who are eager to sidestep the over-supplied U.S. Midwest, where Canadian crudes sell at a discount to benchmark prices, and tap directly into foreign markets.

But the project is facing growing opposition from communities throughout Metro Vancouver, who worry about the risks that come with more oil being stored in tanks in Burnaby and more tanker ship traffic on Pacific Coast waters.

Kinder Morgan has said it needs access to the mountain to complete environmental and geotechnical studies that it must submit to the NEB before a Dec. 1 deadline. The regulator has already pushed back its decision on the project by about six months to January 2016.

Reporting by Julie Gordon; Editing by Ken Wills

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