A B.C. Supreme Court judge dismissed an application on Wednesday for an injunction against survey crews on Burnaby Mountain, the company's preferred new route for its Trans Mountain pipeline.
Judge Brenda Brown did not immediately give reasons for her decision and Burnaby Mayor Derek Corrigan did not return a call seeking comment.
The legal action was the latest tussle in an ongoing feud between the Metro Vancouver municipality and the Texas-based pipeline giant over the proposed $5.4-billion expansion of the existing line linking the Alberta oilsands to the company's tanker terminal on Port Metro Vancouver.
City of Burnaby opposition escalated when the company proposed tunnelling through Burnaby Mountain, home to Simon Fraser University and a large conservation area.
The National Energy Board previously upheld the company's right to access the land under federal law but the civil action filed by the city last week claimed the federal regulator couldn't exempt the company from city bylaws.
Burnaby asked the court to prevent any work that destroys trees or disrupts park land.
In turn, Kinder Morgan filed a motion asking the National Energy Board to go further and forbid the city from obstructing its crews. That decision from the board is imminent.
In the interim, the company did not plan to immediately resume work.
"We're satisfied with today's decision from the B.C. Supreme Court denying the City of Burnaby's application for an injunction. We maintain that the National Energy Board has jurisdiction in this matter and has given us the authority to undertake the work needed on Burnaby Mountain," Carey Johannesson, the company's spokesman, said in a statement.
"We will await the NEB's response to our motion filed on September 3, before resumption of work."
The expansion would almost triple the pipeline's capacity, from 300,000 barrels a day to about 900,000 barrels.
In Burnaby, where Kinder Morgan was fined for a 2007 construction accident along the pipeline that rained 230,000 litres of oil down on a neighbourhood, residents were not deterred by the court failure.
Burnaby Residents Opposed to Kinder Morgan Expansion, or BROKE, planned to maintain a presence on Burnaby Mountain and mobilize a protest should work resume.
Neil Chantler, a lawyer representing those residents, said they are fully behind the city.
"What's at issue, in part, is whether or not access means cutting down 24-metre tall trees and boring large holes deep into the ground," he said.
The residents and the city argue that such damage goes well beyond access, to a violation of city bylaws. Chantler said the NEB decision is expected in the next week.
"All signs point to the National Energy Board giving Kinder Morgan whatever power it needs in order to conduct its surveys," he said.
The dispute has already set the regulatory review back seven months. A final report to cabinet is now due Jan. 25, 2016 — if the company can complete the necessary surveys and submit them to the board by Dec. 1.