Canadian regulator to hold hearings on Trans Mountain pipeline

VANCOUVER, April 2 Wed Apr 2, 2014 7:32pm EDT

VANCOUVER, April 2 (Reuters) - Canada's energy regulator said on Wednesday it would hold hearings on Kinder Morgan Energy Partners LP's proposed expansion of the Trans Mountain oil pipeline from Edmonton to Vancouver, with its review expected to wrap up in mid-2015.

The National Energy Board (NEB) said it identified 12 issues for discussion during the hearings, including the environmental effects of the project, its impact on aboriginal interests and contingency planning for accidents, among other things.

Kinder Morgan filed an application in December to nearly triple the capacity of its 715-mile (1,150-km) Trans Mountain line, which is the only pipeline running from Alberta's vast oil sands to British Columbia's coast.

The C$5.4 billion ($4.89 billion) project involves twinning the existing pipeline where possible and would boost capacity to 890,000 barrels per day (BPD) from 300,000 BPD.

The proposed expansion has strong support from oil producers, who are eager to get their product to Canada's Pacific coast for export to international markets, potentially alleviating steep price discounts on oil sands crude.

But the increased capacity would add to tanker ship traffic along the Pacific Northwest, fueling backlash from environmental groups over the potential for marine oil spills.

The public hearings on the Trans Mountain expansion will start in January 2015, with the NEB set to hear traditional aboriginal evidence in August and September of this year.

The regulator will hear from environmental and nature conservation groups, municipalities, community organizations and private citizens affected by the proposed expansion, along with energy producers and business groups that back the pipeline.

"The groups and individuals who have been granted standing to participate in the hearings really cover a very broad range of interests," said NEB spokeswoman Sarah Kiley.

"That broad range of information and evidence that will be placed before the board is very helpful in coming to a recommendation or decision."

But Sierra Club BC, an environmental advocacy group, criticized the regulator for denying or downgrading the participation of 920 of the 2,118 people or groups applying to speak at the review.

"This is a rigged process, deliberately designed to silence the legitimate voices of British Columbians on an issue that has profound implications for our province," said Sierra Club BC campaigns director Caitlyn Vernon in a statement.

Kinder Morgan's Trans Mountain expansion is just one of numerous new pipeline projects being planned to help transport booming crude production from Alberta's oil sands, where output is expected to more than double by 2025.

The NEB has already recommended approval of Enbridge Inc's controversial Northern Gateway pipeline, provided the company complies with some 200 conditions. That line would run from Alberta to the port of Kitimat in northern British Columbia.

In the coming months, U.S. President Barack Obama is expected to rule on TransCanada Corp's Keystone XL pipeline, which would send Canadian oil to the U.S. Gulf Coast. TransCanada is also developing the Energy East line, which would bring Western Canadian oil to Eastern Canadian refineries. ($1 = 1.1038 Canadian Dollars) (Reporting by Julie Gordon; Editing by Richard Chang)

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