| VANCOUVER/CALGARY, April 14
VANCOUVER/CALGARY, April 14 Opponents of
Canada's Northern Gateway pipeline, bolstered by a coastal
town's vote against the project, said on Monday they will now
push harder for a provincial referendum they hope would kill
Enbridge Inc's plan to move oil sands crude to Asian
Residents of Kitimat, located in British Columbia's remote
northwest, voted against the proposed project on Saturday, with
58.4 percent of residents opposed in the non-binding poll. The
small town is where the terminal facilities for the C$7.9
billion ($7.21 billion) pipeline would be built.
The victory has fueled calls for a vote to determine if
there is public support in the rest of the West Coast province
of British Columbia, which would host more than half of the
pipeline and all the marine transport facilities.
"This is a turning point in Enbridge's campaign to buy
social license," said Kai Nagata, energy & democracy director at
the Dogwood Initiative, an environmental group campaigning for a
provincial vote on Northern Gateway.
The group hopes to use a so-called citizen's initiative,
legislation last used to launch a British Columbia-wide vote
that succeeded in getting rid of an unpopular sales tax.
Saturday's vote in Kitimat came after a month of divisive
campaigning by both sides. Supporters pointed to the jobs and
tax revenue that would be generated, while opponents cited their
fears of an oil spill.
As with TransCanada Corp's proposed Keystone XL
pipeline to the United States, environmentalists also fear that
Northern Gateway will hasten the development of Canada's oil
sands and exacerbate climate change.
The line would be Canada's first major export route to the
oil-hungry economies of Asia. It's backed by Canada's energy
industry, which currently sells most of its oil to U.S. buyers
at a steep discount to benchmark prices.
But numerous recent polls have found that more people in
British Columbia oppose the project than support it, although
support is increasing.
And Enbridge has also faced strong opposition from many
aboriginal communities, who are concerned about the impact the
project will have on British Columbia's pristine northern realm.
Still, the company said on Monday it is unfazed by the
plebiscite result and would keep trying to win public support.
"We will be continuing on our original plan, which is to
continue to engage with the district of Kitimat as well as with
other communities in British Columbia as well as Alberta," Janet
Holder, Enbridge's executive vice-president, western access,
said in an interview.
"It has always been our plan to continually ... travel
around the communities, talk to the communities, provide them
opportunities to ask questions, provide the opportunity to
For now, the future of the 1,177-kilometer
(731-mile)pipeline is in the hands of the Canadian government,
which has jurisdiction over the project.
Regulators in December recommended it be approved,
contingent on Enbridge meeting 209 technical, environmental and
social conditions. The government, which has the final say, is
expected to make its decision in June.
Prime Minister Stephen Harper's ruling Conservatives have
been largely supportive of Northern Gateway, but reiterated on
Monday they will only approve projects if they are safe for
Canadians and the environment.
Despite a supportive federal government, investors are not
banking on the project just yet.
BMO Capital Markets analyst Carl Kirst thinks Northern
Gateway will eventually be approved, yet he does not include the
project in his valuation of Enbridge.
Even if approved, he expects the proposed pipeline will face
lengthy legal battles from opponents and noted the company must
still address the conditions outlined by regulators.
"In a couple of years, if this project is actually moving
forward, once perhaps they get to a point where ground is
actually broken on it, then I think we'd start to reassess what
the long-term, incremental value would be," said Kirst.
"From our standpoint ... We need a little more clarity and
certainty before we move that valuation into our targets."
In Kitimat, school teacher and Douglas Channel Watch
volunteer Patricia Lange was cheered by the vote, but knows
first-hand that the potential of jobs and tax revenues will be a
tough lure to beat.
Northern Gateway is expected to create 180 direct, permanent
jobs in Kitimat, in addition to some 3,000 construction jobs
along the right of way. Total municipal, provincial and federal
tax revenues over 30 years are projected to be about C$2.6
"It's a lot of money and it would be hard for the government
to ignore that," said Lange. "But that might not be the will of
"There's no doubt to me that communities throughout British
Columbia are going to stand up. I think there will be protests -
that idea of a wall being formed."
($1 = 1.0959 Canadian dollars)
(Editing by Jeffrey Hodgson and Eric Walsh)