Oilpatch downplays conditional approval of Trans Mountain

Oil executives downplayed the National Energy Board’s recommendation Friday to, once again, approve the Trans Mountain pipeline expansion as only a small step toward building a project that will continue to face challenges.

The NEB announced the 590,000 barrels-per-day Trans Mountain expansion project could have “significant adverse environmental effects” on the West Coast and marine wildlife, but is still in the national interest. The pipeline regulator recommended the federal government, which bought Trans Mountain last year for $4.5-billion from Houston-based Kinder Morgan Inc., proceed with the project subject to 156 conditions and 16 non-binding recommendations.

It’s the second positive recommendation for the project from the NEB, which first approved the plans to twin an existing pipeline to the West Coast subject to 157 conditions in 2016. But a new regulatory review was ordered after the Federal Court of Appeals found in August 2018 that the first recommendation failed to consider the pipeline’s contribution to tanker traffic on the West Coast.

“It feels like a re-victory,” Canadian Association of Petroleum Producers president and CEO Tim McMillan said of the new NEB recommendation.

The Canadian energy sector considers the pipeline to be critical infrastructure because oil output outstrips available export pipeline capacity, but executives stopped short of excessively celebrating the decision. “Until we get the oil flowing, we don’t have a pipeline,” Canadian Energy Pipelines Association president and CEO Chris Bloomer said.

That reaction was shared both inside the energy sector and the Alberta provincial government. “It’s a step, not a victory, but it is an important step,” Alberta Premier Rachel Notley said Friday.

Trans Mountain president and CEO Ian Anderson suggested the updated conditions and new recommendations would not impede construction. “It provides specific and achievable conditions under which we must operate to ensure, if approved, the project will protect the marine and terrestrial environment and communities,” he said in a release.

The federal government makes a decision on whether to build the project 90 days from now.