BRITISH COLUMBIA

Northern Gateway Approval Conditions Include Enhanced Oil Spill Response

04/12/2013 01:41 EDT | Updated 06/12/2013 05:12 EDT
CP
VANCOUVER - The panel weighing the future of the proposed Northern Gateway project released a long list of conditions Friday that the company would need to meet should the project receive approval, including almost $1 billion in liability coverage in the event of a catastrophic oil spill.

The joint federal review panel stressed that the release of draft conditions does not mean a decision has been made.

"The panel has not made any decisions on whether or not to recommend approval of the proposed project," said a letter provided to review participants by the panel. "The publication of potential conditions is a standard step in the hearing process that is mandated by the courts."

The parties involved have until the end of May to comment or propose additional conditions as part of their written final arguments.

Among the 199 conditions proposed by the panel, Northern Gateway Pipelines, a subsidiary of Enbridge Pipelines Inc. (TSX:ENB), must have total coverage of $950 million for clean-up, remediation and any other damage that might result from the project.

That would include unfettered access to at least $100 million within 10 business days of a large spill to cover immediate costs while insurance claims are processed.

The company would also have to undertake a research program on the behaviour of heavy oils such as diluted bitumen, a molasses-like petroleum product that will course through one of two pipelines linking Bruderheim, just outside of Edmonton, to a tanker port in Kitimat, B.C. The second pipeline would carry natural gas condensate, used to dilute bitumen, east from B.C. to Alberta.

Northern Gateway would need to submit environmental and marine monitoring plans and track aboriginal, local and regional employment for monitoring by the National Energy Board.

It would have to submit plans for monitoring species at risk and file a caribou habitat restoration plan, as well as submit plans to the board for monitoring air quality and soil contamination.

Under the conditions proposed by the panel, any certificate would expire unless construction has begun by Dec. 31, 2016.

Ivan Giesbrecht, a spokesman for Northern Gateway Pipelines, said the company is closely reviewing the document issued by the panel.

"We're very pleased to receive these potential conditions. It's a normal and expected part of what we consider a very inclusive joint review process," Giesbrecht said.

"At this point, we're not in a position to make comments on any specific conditions until our team has thoroughly reviewed the entire document."

The conditions will set in stone many voluntary commitments the company has made in response to public concerns in British Columbia, where conservation groups have targeted the Northern Gateway with protests.

Besides the panel's requirement that Enbridge have its own insurance for Northern Gateway, there is also a $1.3-billion industry insurance fund to cover a marine oil spill. Opponents have said that fund would fall far short of even clean-up costs.

By the time BP has paid for clean-up of the Gulf oil spill, paid fines and settled lawsuits with those affected, the tab is expected to be around $36 billion, according to reports.

The B.C. government has said it’s considering a similar industry fund scheme to cover land-based oil spills, which currently would be covered by the pipeline company.

Ben West, of ForestEthics Advocacy, said the conditions won't sway project opponents.

"I take it as a sign that the (National Energy Board) is getting the message that people are really concerned about this pipeline," West said, pointing out that no other pipeline project has had so many conditions put forward by a review panel.

"I don't think it's going to change much in terms of how the public feels about these pipelines. The end result is still a pipeline being built, and I think that's the opposite of what people want to see happen.

"The safest option is just not to build this pipeline."

Final hearings on the project are slated to begin next month. The panel has until the end of the year to submit its report and recommendation to the federal cabinet.

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