Report: Industry Backing for Oil Sands Pipelines to Canadian West Coast Growing
21 November 2009
With the Canadian energy industry seeking diversification from the US and potential greenhouse gsa regulations, the Globe and Mail reports that commercial backing is growing for Enbridge Inc.’s stalled Northern Gateway pipelines project.
| The Northern Gateway Project. Click to enlarge. |
The Northern Gateway is a proposed 1,170-kilometer twin pipeline capable of carrying 525,000 barrels per day of oil sands crude from Edmonton, Alberta to Kitimat on the British Columbia coast and more than 190,000 barrels per day of condensate back from Kitimat to Edmonton.
In 2005, when Enbridge Inc. sought shippers for its Northern Gateway project...support was too low and the proposed project lost traction. By early next year, however, Enbridge expects to announce for the first time that it has secured “solid” commercial backing for Gateway, marking a major step forward in the country’s plans to diversify its oil exports.
That comes amid a shifting of the landscape, as industry executives, politicians and economists increasingly promote the idea that it is risky to rely solely on the United States to buy Canadian crude, especially as the oil sands grow in importance and demand for oil stagnates south of the border.
Northern Gateway’s West line, 36 inches in diameter, will transport an average of 525,000 barrels of oil sands crude per day. The East Line, 20 inches in diameter, will carry 193,000 barrels of condensate per day back to Edmonton. Condensate is used to thin petroleum products for pipeline transport.
Enbridge would build and operate a marine terminal at Kitimat with two ship berths. The terminal would include storage tanks for petroleum and condensate.
The Globe and Mail also notes that Kinder Morgan Canada, which currently owns the 300,000 barrels per day Trans Mountain pipeline to the Pacific, is drafting two expansion plans, one to expand Trans Mountain capacity by 80,000 barrels, and another to add a further 320,000, which it plans to detail in the next three to six months.
Kinder Morgan is also working with Vancouver port authorities to sail huge, one-million barrel Suezmax tankers into harbour there, in hopes of boosting exports, which have already seen a dramatic rise this year.
This borders on criminal. Remember a couple years ago a BC Ferries ship SANK in the inlet to Kitimat? And we are proposing bringing giant oil tankers in there every day?!?!?!!?
Posted by: Mark_BC | 21 November 2009 at 11:17 AM
The Canadian have a problem to day, the crude oil made out of tar sand can only be sold at a discount price to US and be paid with a depreciated dollard. bad news since tar sands crude oil is expensive to extract so margin is low. With pipeline going to the cost they can sell this crude oil to china, japan, taiwan, korea, philipina. No need to discount the price, it is a no brainer. like it or no
Posted by: Treehugger | 21 November 2009 at 11:27 AM
"This borders on criminal."
Can you cite the law they are violating?
Posted by: Joff | 21 November 2009 at 01:54 PM
I expect that my ENCANA stock should do quite well, thank you very much.
Posted by: Mannstein | 21 November 2009 at 04:01 PM
Brilliant move from a business & energy independence perspective.
Posted by: ejj | 21 November 2009 at 07:22 PM
Kitimat already has what looks like an industrialized port, albeit a small one.
http://maps.google.com/maps?f=d&source=s_d&saddr=53.996771,-128.695393&daddr=&geocode=&hl=en&mra=mi&mrsp=0&sz=13&sll=53.985973,-128.674278&sspn=0.048953,0.143509&ie=UTF8&t=h&z=13
Posted by: ejj | 21 November 2009 at 07:45 PM
Don't forget Exxon Mobil just found the mother-of-all natural gas finds in BC too...I wouldn't be surprised if nat gas operations are established or expanded at Kitimat as well if this project goes through.
Posted by: ejj | 21 November 2009 at 08:04 PM
NG, Crude oil ports and pipelines are nothing new. Both products could be exported to Asia for decades to come.
Customer diversity would be multiplied, specially with countries with stronger currencies.
Canada would be much beter off than having to rely on a single customer with a peaked economy.
Posted by: HarveyD | 22 November 2009 at 09:12 AM
Another informative site on the Port of Kitimat http://www.kitimat.ca/assets/Business/PDFs/private-international-port-of-kitimat.pdf
Posted by: ejj | 22 November 2009 at 10:47 AM
BC voters will never let this happen. Pipelines direct to the south of the tar sands will find far less resistance.
The First Nations legal impediments are alone enough to kill any pipeline through British Columbia.
Posted by: Reel$$ | 22 November 2009 at 01:17 PM
joff,
AFAIK, there are no laws against insanity, making lots of money, suicide, or corporate vandalism so no luck there.
Assisted geneotypecide, environmental vandalism laws,as practiced in this Dickensian world are a bit "17th century" , so no luck there either.
Unfortunately the world demand for All the above will not be met very soon but hopefully we can school up and make a difference.
Just don't stop expressing your opinions for the best possible outcome.
Posted by: arnold | 22 November 2009 at 06:46 PM
More big investments in fossil fuels. At some point it will cost SO much to do all of this that other methods will look attractive. You build a pipeline and it runs for 30 years and then the source is tapped out. $100s of billions of dollars are spent and then it is the end of the line. I would want something more sustainable for my large investment if I were them.
Posted by: SJC | 22 November 2009 at 07:57 PM
@ arnold
As an amusing piece of information, I inform you that suicide was considered a crime in several countries and sometimes was punished by death (no kidding).
Look at this link:
http://law.jrank.org/pages/2180/Suicide-Legal-Aspects.html
Posted by: Simodul | 23 November 2009 at 01:17 AM
"amusing" of course only referred to the fact that people who commited suicide and died could still be sentenced to death.
Posted by: Simodul | 23 November 2009 at 01:18 AM
What is basically wrong with shipping 1 billion tonnes (or more) of coal, crude oil and NG to China and India and other countries in Asia during the next decades, if they can pay for it?
Canada was and still is on the receiving end for the same products for decades and nobody complained.
An about face is not so bad for the Canadian economy.
Posted by: HarveyD | 23 November 2009 at 09:43 AM
Arnold:
I suppose my original post was unclear. I know that there is no law preventing Canada or its companies from building a pipeline to transport natural resources. What I was attempting to do (unsuccessfully) was to point out to Mark BC that hyperbole cheapens an argument and makes the the person using it appear foolish.
If I could invest in the pipeline I would, so count me among your "insane".
Posted by: Joff | 23 November 2009 at 10:03 AM
I don't judge criminal behavior based on laws made up by lawyers 50 years ago, rather I use science, morals, and common sense.
The BC Ferry sank 2 years ago almost exactly where these freighters will go. And amazingly, at this very second, I am listening to a news item about how the ferry from Prince Rupert to the Queen Charlotte Islands got battered on the crossing and had to turn around halfway through today. And you believe we can be sure to avoid oil spills?
Sure, this pipeline will bring BC money. All that will do is bring in yet more people and raise real estate prices even higher, leading to even more unsustainable economic growth used by the real estate profiteers to make money off our publicly owned forest lands, for the government to sell off more publicly owned forest land for private real estate "development" to bring in revenue to help balance its budget because we have way too much economic growth for sustainable infrastructure improvements to keep up with.
The pipeline would be just the beginning. This would of course be the logical stepping stone to opening up the coast to drilling, after all the supposedly beneficial economic growth from the olympics ends and we are left with thousands of unemployed people who came here for the unsustainable construction boom and need new jobs.
How much did it cost to clean up the Exxon Valdez spill? How much do the cumulative losses to the fishing industry add up to?
Why are we promoting a dirty unsustainable industry when the demand for fisheries products is only growing?
Asia can solve its own energy problems. Canada is setting itself up for some major economic problems in 15-20 years when the oil industry dies and all this current economic activity comes to a decline and we scramble to find alternatives to take up the slack.
Why should we be bowing to the pressure of big oil, the industry that does everything it can to manipulate patents, politicians and public opinion to try to stifle innovation and keep us all addicted to fossil fuels?
Next summer I'm kayaking to Alaska through the Inside Passage and making a documentary about the nature and the threats it faces from oil development and unrestricted gas and mining development of pristine publicly owned watersheds.
Posted by: Mark_BC | 23 November 2009 at 06:23 PM
"I don't judge criminal behavior based on laws made up by lawyers 50 years ago, rather I use science, morals, and common sense."
The word "criminal" is a real word and has a real legal meaning - it is not derived from the opinions of one individual, regardless of how arrogant that person is.
The problem with forming an idea of criminal based on "science, morals, and common sense" is that those concepts change for every individual.
If you think I'm wrong, then attempt to get the police to arrest the people involved in the construction of the pipeline. I would be interested in seeing how far you get with that - I think you will receive a lesson regarding how seriously people take the idea that your "science, morals, and common sense" are the arbiters of what constitutes criminal behavior.
Thank you for taking the time to post your response - you helped me prove the point I was attempting to make.
Posted by: Joff | 24 November 2009 at 07:51 PM
"The word "criminal" is a real word and has a real legal meaning"
OK, thanks Mr. Webster's New World Dictionary.
"If you think I'm wrong, then attempt to get the police to arrest the people involved in the construction of the pipeline. I would be interested in seeing how far you get with that"
Yes, those people are on the forefront of defending science, morals, and common sense.
"The problem with forming an idea of criminal based on "science, morals, and common sense" is that those concepts change for every individual."
Science doesn't change for any individual.
Morals are pretty ubiquitous, mostly consistent across all cultures, and basically boil down to -- don't unfairly shaft other people for personal gain. Unfortunately, that is what the oil industry and its conspirators are doing -- shafting future generations and those who own property below 7 m elevation, and basically anyone who wants to drive a car or heat a building, unnecessarily I might add, when the above mentioned science has provided viable solutions that don't involve fossil fuels.
Common sense is also pretty ubiquitous. When you have better ways of dealing with energy that are both cheaper and more environmentally friendly (electric cars for transport and ground source heat pumps for heating), then don't pursue oil.
Posted by: Mark_BC | 24 November 2009 at 08:07 PM
"Science doesn't change for any individual."
A week ago I would have agreed with that notion. CRU has changed that.
"Morals are pretty ubiquitous, mostly consistent across all cultures, and basically boil down to -- don't unfairly shaft other people for personal gain."
I guess you have never done business in Hong Kong. Certain Southwestern Native American tribes believe that cheating is okay until you get caught. Perhaps you don't think they count? Besides, how do you know someone else thinks they are shafting you? Is everybody expected to read your mind and act accordingly? I live approximately 100 meters from the beach and well below 7m elevation, and I don't have a problem with them building a pipeline and using fossil fuels.
As far as viable ways to avoid fossil fuels, such as electric cars, let me know where I can purchase an electric car that is similarly equipped to the 4 door vehicle I drive now and that allows me the same range, and I will purchase it in 6 months when I trade my current vehicle in.
Posted by: Joff | 24 November 2009 at 08:54 PM