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Enbridge to spend up to $500mn more on Canada pipeline safety features

07.20.2012  | 

The company's plan to build an oil pipeline from Alberta to a port in Kitimat, British Columbia, for export overseas faces opposition within the province, including from native groups and environmental organizations. Northern Gateway would ship up to 525,000 bpd and is scheduled for a 2017 startup.

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By EDWARD WELSCH

CALGARY, Alberta -- Enbridge on Friday said it will spend up to 500 million Canadian dollars ($494.2 million) more on safety features for its proposed Northern Gateway oil pipeline to Canada's western coast.

The Calgary-based energy-infrastructure company's plan to build an oil pipeline from Alberta to a port in Kitimat, British Columbia, for export overseas faces opposition in Canada's westernmost province, including from native groups and environmental organizations.

They say they are concerned about the possibility of oil spills from the pipeline reaching rivers and lakes, or contamination of B.C.'s coast from tanker spills.

Enbridge said it will spend an extra C$400 million to C$500 million to improve Northern Gateway, which was estimated to cost C$5.5 billion to build.

"With these enhanced measures, we will make what is already a very safe project even safer in order to provide further comfort to people who are concerned about the safety of sensitive habitats in remote areas," said Janet Holder, executive vice president of Enbridge's Western Access division.

Opposition within Canada to the pipeline was revitalized last week by events in the US. The US National Transportation Safety Board said repeated mistakes made by Enbridge caused and worsened a 2010 oil spill from the Mainline pipeline in Marshall, Mich.

The spill contaminated the Kalamazoo River, and the NTSB said at $800 million, it was the costliest onshore spill cleanup in US history.

Following the NTSB's report last week, B.C. Premier Christy Clark told reporters Enbridge should be "deeply embarrassed" and that it could "forget it" if it planned to operate the Northern Gateway pipeline in the same way.

The decision to approve the pipeline is made by a Canadian federal review board, though British Columbia's government can make its opinion on the project heard during the review process.

Projects like Northern Gateway have support from Canada's ruling Conservative government, which has said opening new pipeline routes to the western coast in order to ship oil to Asia is a strategic priority for Canada.

Northern Gateway would ship up to 525,000 bpd and is scheduled for a 2017 startup.

Enbridge told regulators the extra safety features would include thicker walls for the entire 730-mile pipeline, and extra thickness in areas where it crosses waterways.

It would also increase the number of valves to cut off the flow of oil by 50%, increase the frequency of inspections by at least 50%, install dual leak-detection systems, and staff remote pump station locations continuously to improve safety and accident response times.


Dow Jones Newswires



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