Canada approves controversial pipeline to ship Alberta oil to BC

Native and green groups vow to block project to make Alberta oil available to Asian markets

PUBLISHED : Wednesday, 18 June, 2014, 9:58pm
UPDATED : Thursday, 19 June, 2014, 12:13pm


Canada's government has approved a controversial pipeline proposal that would bring oil to its Pacific coast for shipment to China and elsewhere, a major step in the country's efforts to diversify its oil exports if it can overcome fierce opposition from environmental and native groups.

Tuesday's approval for Enbridge's Northern Gateway project had been expected, as Canada needs infrastructure in place to export its growing oil-sands production.

The project's importance has only grown since the US delayed a decision on TransCanada's Keystone XL pipeline that would take oil from Alberta to the US Gulf Coast.

Canada's Alberta province has the world's third-largest oil reserves, with 170 billion barrels of proven reserves.

Enbridge's pipeline would transport 525,000 barrels of oil a day from northern Alberta's oil sands to the Pacific to deliver oil to Asia, mainly China. About 220 large oil tankers a year would visit the British Columbia town of Kitimat, and opponents fear pipeline leaks and a potential tanker spill on the pristine Pacific coast.

But the project has been fiercely opposed in BC. Hundreds of people protesting the decision blocked main streets in Vancouver on Tuesday.

Prime Minister Stephen Harper has said national interest made the pipelines essential.

He has spoken of the need to diversify Canada's oil industry. Ninety-seven per cent of Canadian oil exports now go to the US.

Meanwhile, China's economy is hungry for oil, with state-owned companies investing more than US$40 billion in Canadian energy in the past few years.

"They are watching this very, very closely," said Wenran Jiang, an energy expert and adviser to Alberta's Department of Energy.

"They told us as recently as a couple of weeks ago that further investment will depend on whether there will be at least opportunities to ship some of this crude to China."

Canadian Natural Resources Minister Greg Rickford said Enbridge must meet the 209 conditions Canada's regulator imposed on the pipeline.

The company has previously said it would.

Enbridge CEO Al Monaco welcomed the decision but noted "we still have some more work to do".

BC Premier Christy Clark set out five conditions for the province's support, and on Tuesday she repeated that those conditions had yet to be met. The British Columbia government can deny permits.

Environmentalists and Canada's native tribes could delay approval all the way to the Supreme Court, and the tribes still hold title to some of the land the pipeline would cross.

Union of British Columbia Indian Chiefs grand chief Stewart Phillip said natives would blockade any attempt to start work.

Environmental groups said Ottawa's approval is no guarantee that the controversial project would be built.

"We are deeply disappointed, but you need to look no further than the spate of legal challenges filed against this project to know that cabinet's approval is by no means a guarantee that this project will ever be built," said Barry Robinson, a lawyer for Ecojustice.