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British Columbia announces scientific panel that could delay or even end the Kinder Morgan pipeline

The Council of Canadians Victoria chapter helped block the Kinder Morgan terminal yesterday in opposition to the 890,000 barrel per day Trans Mountain pipeline.

Kinder Morgan’s proposed Trans Mountain pipeline may have just been dealt a decisive blow by the BC government.

The Globe and Mail reports, “British Columbia’s NDP government is moving to block Kinder Morgan Inc.’s planned pipeline expansion with new oil-spill regulations that would prohibit companies from expanding shipments of diluted bitumen from the oil sands through the province until it can review oil-spill response capabilities.”

The BC government will launch an independent scientific panel to study the ability to mitigate spills and while provincial environment minister George Heyman says new oil-spill response rules could become law “later this year or in early 2019”, Global News reports the study itself “could take about two years to complete”.

Burnaby Now reports, “Trans Mountain spokesperson Ali Hounsell … did not provide comment when asked if the province’s new rules will further delay the project.” But West Coast Environmental Law comments, “The proposed regulation should be a huge wake-up call for Kinder Morgan because it signals that there are significant and potentially insurmountable regulatory hurdles that still face the Trans Mountain project. If a dilbit spill cannot be safely and effectively cleaned up, the new B.C. regulations may prevent the company from turning the taps on, even if it’s able to complete construction.”

Heyman says that the province’s Environmental Management Act (that regulates substances that can potentially harm the environment) gives it the right and responsibility to conduct this study and notes, “We know the regulation of vessels is federal jurisdiction, but the impact of a spill on the coastline, that’s B.C.’s jurisdiction.” And while he acknowledges that pipelines that cross provincial borders are federally regulated said the province would “deal with a legal challenge when and if it happens”.

In December 2017, Kinder Morgan said that each month of delay in construction of the Trans Mountain pipeline costs them $35 million in hard costs (salaries, etc), while each month of delay after the start-up date costs them $90 million in lost profits. Kinder Morgan had originally set the pipeline’s in-service date as December 2019. Two months ago, it delayed that in-service date to September 2020 (which implies $810 million in lost profits). Then last month it delayed that in-service date even further to December 2020 (which implies an additional $270 million in lost profits).

It’s not clear how long a delay will make the $7.4 billion pipeline an unprofitable proposition for the Texas-based transnational corporation. But The Globe and Mail reports, “Should the [scientific panel] determine there is no effective clean-up for bitumen dumped into waterways, the province would likely move to make the regulation [prohibiting companies from expanding shipments of diluted bitumen through the province] permanent.”

The BC Government’s media release notes, “The general public will be able to provide input online through written comments, once an intentions paper is released. The intentions paper will provide an overview of the proposed regulations, and is expected to be posted before the end of February 2018.”

The Council of Canadians will both encourage and assist the public to provide input into the proposed regulations.