Pipeline feeding Burnaby terminal to be twinned

Kinder Morgan announces plans for $ 3.8- billion expansion of Trans Mountain line

CALGARY — Kinder Morgan Energy Partners LP said Tuesday it will move ahead with planning a $ 3.8- billion proposed twinning of its Trans Mountain oil pipeline to connect growing oilsands production with Canada’s West Coast for export, after receiving strong and binding commitments from shippers.

The company said it will decide on the expansion size by the end of the first quarter for the Alberta- British Columbia project, which competes with Enbridge Inc.’ s proposed Northern Gateway pipeline.

Both pipeline projects are based on a desire for increased access to global oil markets by landlocked oilsands producers set to more than double bitumen output by 2020, from a decade earlier. Canadian crudes are earning steep discounts to international prices on each barrel exported into the primary U. S. market, largely due to a glut in supply at Cushing, Okla. and increased production south of the border.

Kinder Morgan is still determining the expanded capacity of the existing 1,150- kilometre line, which currently delivers 300,000 barrels of oil per day from Edmonton to Burnaby, B. C., the company said. The so- called open-season process to gauge support from shippers on the line, which began last October and closed earlier this month, was based on a 600,000 barrel- per day capacity design.

A “diverse group of existing and new shippers” back the expansion, Kinder Morgan said, not naming those shippers.

“The strong support received through this process will now allow us to complete initial project design and planning,” Ian Anderson, Kinder Morgan Canada president, said in a statement.

“We are looking forward to engaging in dialogue with First Nations, interested stakeholders and communities along the pipeline.”

The Trans Mountain expansion has received less public attention and scrutiny than the 525,000 barrel- perday Northern Gateway proposal from Bruderheim, Alta. to Kitimat, B. C.

Environmental groups, some First Nations communities and a group of B. C. mayors have been among those to publicly sound the alarm about the Trans Mountain expansion, though, over fears it would increase oil- tanker traffic and the risk of spills in coastal waters off B. C.’ s Lower Mainland.

Kinder, a Houston- based pipeline partnership, has not yet applied for Canadian regulatory approval of the Trans Mountain expansion and didn’t say when the expansion could be operating.

The joint regulatory review panel assessing Northern Gateway has said it expects to issue a recommendation on that project late next year.