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Kinder Morgan Canada Unshaken by BC Protests to Halt Trans Mountain

Kinder Morgan Canada is refusing to be rattled by political protest in British Columbia (BC) and is maintaining a mid-September date for starting construction of its growth-enabling pipeline project for the country’s top industrial natural gas consumer, the Alberta oilsands.

Work is on schedule for the Trans Mountain Pipeline, a C$7.4 billion ($5.8-billion) expansion that would triple capacity to 890,000 b/d on the 987-kilometer (592-mile) pipe.

The pipeline remains on track to move oil from Edmonton to a Vancouver tanker dock, said Kinder Morgan Canada President Ian Anderson.

However, BC Attorney General David Eby and Environment Minister George Heyman said Thursday they had retained a prominent retired judge and aboriginal rights advocate, Thomas Berger, for advice on legal action to halt the federally approved project.

Eby and Heyman, following up on their New Democratic Party’s spring election pledge to resist the project, also vowed strict enforcement of conditions in a provincial environmental certificate granted by BC’s previous Liberal regime.

“We are committed to working with the province and permitting authorities in our ongoing process of seeking and obtaining necessary permits and permissions,” said Anderson. “We have undertaken thorough, extensive and meaningful consultations with aboriginal peoples, communities and individuals and remain dedicated to those efforts and relationships as we move forward with construction activities in September.”

About 40% of the project is in Alberta. A difficult part, capacity additions across the Rocky Mountains into BC through national and provincial parks, was completed in 2007-2008 under expansion rights granted by the federal government when the original line was built in 1953.

Berger, who led a 1970s federal inquiry that stopped the first Mackenzie Valley natural gas pipeline proposal, is expected to guide planned BC government intervention in law court appeals against the Trans Mountain approval by the National Energy Board (NEB).

Kinder Morgan Canada and the NEB followed procedures that the Supreme Court of Canada upheld in a landmark verdict last week against an Ontario aboriginal rights appeal to overturn approval of an Enbridge pipeline project.

The BC political protest, while noisy, is restrained compared to the worst-case scenario described by the prospectus for a successful May initial public offering of C$1.75 billion ($1.4 billion) in Kinder Morgan Canada.

The prospectus warned that “the Trans Mountain Expansion Project may be subject to additional significant regulatory reviews, there may be significant changes to the Trans Mountain Expansion Project plans, further obligations or restrictions may be imposed or the Trans Mountain Expansion Project may be stopped altogether.”

The Canadian constitution assigns the federal government jurisdiction over projects that cross provincial or international boundaries. However, a hostile province might try to withhold land use or environmental permits or interfere with essential construction and operational services such as access roads and power supplies, the prospectus noted.

Before announcing Berger’s recruitment as special legal counsel, Eby said the province would refrain from unilateral interference because it would create liability for extremely expensive losses in project damage lawsuits.

An omnibus appeal against Trans Mountain’s expansion approvals, including multiple aboriginal and environmental cases, is currently advancing through Canada’s federal court system.

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