Canada regulator allows more Kinder Morgan pipeline construction

VANCOUVER (Reuters) - Canadian regulator National Energy Board (NEB) on Thursday issued rulings that allow Kinder Morgan Canada to do additional construction work on an oil pipeline expansion that is fiercely opposed by the province of British Columbia.

File Photo: Crude oil tanks at Kinder Morgan's terminal are seen in Sherwood Park, near Edmonton, Alberta, Canada November 13, 2016. REUTERS/Chris Helgren/File Photo

The board issued three decisions that collectively allow Kinder to start work in the Vancouver area on the Burnaby Mountain tunnel entrance of its Trans Mountain pipeline expansion, subject to other permits.

It lifted all remaining pre-construction conditions relating to the tunnel, and approved the pipeline’s route where the tunnel will be built.

The decisions inch the Trans Mountain expansion closer to reality, however Kinder Morgan reiterated that it was holding off on starting full construction while it awaited further permits and court decisions.

The NEB has approved just over half of the final route for the expansion, which is a twinning of an existing pipeline extending from Alberta’s energy heartland to a port in Burnaby, a suburb of Vancouver.

A lawyer for the city of Burnaby said that while rulings were expected, the speed of the decisions was frustrating, as detailed route hearings are still ongoing.

“It does seem that whatever Trans Mountain asks for, the NEB appears happy to provide,” said lawyer Greg McDade, adding the city will file an appeal on Friday over previous NEB rulings allowing Kinder Morgan to sidestep some municipal permits.

Kinder Morgan Canada noted the tunnel construction will not disrupt the surface of Burnaby Mountain, and avoids construction through residential neighborhoods.

The pipeline expansion is crucial for landlocked oil producers who receive deeply discounted prices from U.S. refineries because of transportation constraints.

British Columbia’s left-leaning government opposes the pipeline, and has threatened to block additional oil shipments through the province as it studies how to clean up potential spills.

Reporting by Rod Nickel in Winnipeg, Manitoba and Julie Gordon in Vancouver; Editing by Sandra Maler and Richard Pullin