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Kinder Morgan president says B.C. pipeline benefits fair, conservative

Local route of Kinder Morgan pipeline.
Image Credit: Wildernesscommittee.org
November 13, 2014 - 7:29 AM

VICTORIA - Duelling reports about job-creation numbers and oil spill cleanup costs for the proposed Kinder Morgan pipeline expansion from Edmonton to Burnaby, B.C., have prompted the company to defend the benefits it has forecast for the project.

Kinder Morgan's president Ian Anderson said estimates of a high number of jobs in British Columbia during the proposed expansion of its Trans Mountain pipeline are based on fair and reasonable assumptions.

He also justified the company's liability insurance coverage for an oil spill as "more than enough."

But Anderson said he has yet to fully review a Simon Fraser University study that forecasts one-third fewer jobs and concludes the company has not set aside enough cash to handle a major environmental incident.

"Clearly, the SFU study has used a different set of assumptions than what our work has," Anderson said Wednesday during a conference call with reporters. "I'll be most interested in looking at that to determine what's most reasonable. We think what we have done is fair and reasonable and in many respects conservative."

Kinder Morgan's application last year to the National Energy Board included an analysis by the Conference Board of Canada that estimated 36,000 person-years of employment in B.C. while the pipeline was being built.

The NEB is the federal regulatory body that will conduct the review process of Kinder Morgan's application to proceed with the project. The Conference Board of Canada is an Ottawa-based think tank.

"I'm open to considering those (SFU assumptions) and looking at the impact of those," Anderson said. "Most certainly our views on that study will be public shortly."

The university's Centre for Public Policy Research teamed up with a California-based consulting firm to examine the estimated impacts of the project.

It estimated the pipeline expansion will create only about one-third of the projected jobs — 12,000 person years — and B.C. government coffers will reap a small benefit, with most of the benefits going to Alberta and oilsands producers.

Kinder Morgan's proposed $5.4-billion expansion would nearly triple its capacity to ship petroleum products to 890,000 barrels a day, enabling crude exports to Asia through the Vancouver area.

The SFU report expresses concern about Kinder Morgan pegging the top cost of an oil spill at $100 million to $300 million. It said a large spill in a highly populated area such as Metro Vancouver could cost up to $5 billion.

Anderson said Kinder Morgan's estimates of a worst-case spill scenario contained in its report are reasonable, at a cost of $350 million. He said the company's liability insurance coverage reaches to $750 million.

He said an incident in 2007 where city workers ruptured the Kinder Morgan pipeline and sent oil spewing into a neighbourhood cost $21 million to clean up.

"It's our job, and those who are in the marine community's job, to ensure that those risks are as absolutely low as possible, and they can be managed effectively," Anderson said.

He said he expects the B.C. Supreme Court to rule Monday on an injunction application the company made to prevent protests at a test-drill site on Burnaby Mountain.

"I know we have opposition and I know that not everybody supports the project," Anderson said. "I expect and welcome as many voices and opinions as possible. The court case is about us lawfully trying to carry out our studies on Burnaby Mountain that have been authorized by the National Energy Board."

Image Credit: Wildernesscommittee.org

Image Credit: Wildernesscommittee.org

News from © The Canadian Press, 2014
The Canadian Press

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