All signs point to Kinder Morgan expanding the Trans Mountain pipeline, despite widespread opposition from Burnaby residents, according to local MP Kennedy Stewart.
"Kinder Morgan is putting their toe in the water, and they're looking for what kind of reaction they'll get," Stewart said. "And the communities have clearly spoken to me that they don't want this project."
Kinder Morgan recently announced it's moving ahead with plans to twin the 1,150-kilometre Trans Mountain pipeline, which has been in place since the 1950s and runs refined and crude oil products from Alberta to Burnaby. The oil goes to land-based users - like the local Chevron refinery, Shell and Suncor - and overseas shippers, who fill their tankers with crude at Kinder Morgan's Westridge Marine Terminal in North Burnaby. The pipeline can handle 300,000 barrels per day maximum, but that could rise as high as 700,000 if fully expanded, which would mean more tanker traffic in Burrard Inlet as the company tries to meet rising demand in China. If the project goes through, the line could be ready by late 2016 or early 2017. The pipeline currently supplies roughly 90 per cent of Lower Mainland gasoline. Kinder Morgan has not yet applied to the National Energy Board for project approval or held any public consultation sessions yet.
"Kinder Morgan's been really smart in this application. They've kept it very low, under the radar, but now I think the cat's out of the bag really. It's moving ahead," Stewart said.
Stewart, an associate natural resources critic for the NDP, recently commissioned a phone survey of his constituents in the Burnaby-Douglas riding on the pipeline expansion issue. Of the 3,215 people who knew enough to respond, 44 per cent wanted to keep the existing pipeline as is, while 28 per cent supported expansion, and 28 per cent wanted it removed entirely. Stewart said he also did provincewide polling on twinning the line and the idea was not popular. The company hasn't officially announced details of the project either, but more information is expected in March.
"This doesn't have local support, it doesn't have B.C.-wide support, and I would expect it doesn't have national support either," Stewart said.
Oil shipping customers, however, backed Kinder Morgan's possible expansion with binding commercial agreements in a recent "open season" process, and Ian Anderson, president of Kinder Morgan Canada, said the results were "very encouraging."
"The strong support received through this process will now allow us to complete initial project design and planning," he said in a media statement. "We are looking forward to engaging in dialogue with First Nations, interested stakeholders and communities along the pipeline. The final decision on the proposed project will be known by the end of the first quarter of this year."
Stewart said the Kinder Morgan expansion and Enbridge's Northern Gateway Project would drive up domestic oil prices. Canadian crude sells for less because there's not enough pipeline infrastructure to guarantee a steady supply of oil.
"The reason why it's less is because there's not the access to markets," Stewart said. "Once you build these pipelines, if you do, and guarantee long-term supply, the price will go up. So Alberta producers will make more money, but Canadians will pay more for their own oil."
According to one of Anderson's presentations to investors, expanded pipeline capacity would open markets and reduce "land-locked discounts." Tanker traffic could also rise from 65 vessels in 2009 to an estimated 288 by 2016, and there is talk of larger tankers coming into the Burrard Inlet - from the current Aframax class, which carries 650,000 barrels to Suezmax tankers, which can carry one million barrels.
Kinder Morgan spokesperson Lexa Hobenshield stressed that Anderson's presentation was based on future possibilities. To make way for the bigger tankers, the Second Narrows passageway would have to be dredged, the Westridge Marine Terminal would need to be expanded, and the public would have to be consulted, she added.
It's also not clear exactly where the twin pipeline would go. The current line runs along the south side of Burnaby Mountain, through the Forest Grove area, and over to the Westridge Marine Terminal, but the twin line may not go along the existing right-of-way, Hobenshield said.
"In some urban areas, we may not be able to put a pipeline in our existing right-of-way because of urban infill, ... but we're not at any level of detail to know at this point," she said. "The pipeline does run through some backyards in some locations."