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Union Trouble Delays Maritimes' Lateral

Union Trouble Delays Maritimes' Lateral

Maritimes & Northeast Pipeline officials predict there could be a service delay and a rate increase on its 164,000 MMBtu/d Saint John lateral because clearing work has been stopped illegally by union workers. Work was scheduled to begin last Monday on the project, but union laborers physically prevented clearing by HEF Industries Ltd., the hired excavation/clearing contractor, which uses non-union labor.

"We're seeking legal advice to see how we can go about stopping this interference," Maritimes Spokeswoman Krista Jenkins said last Tuesday. "The contractor, HEF Industries, has its equipment and people in a construction yard and the unions won't let them move any equipment out to the right-of-way. Because the unions aren't involved with the contractor, it is illegal for them to be stopping our work. The Royal Canadian Mounted Police are there, but I don't believe there are very many and there are about 200 [union workers] there. Obviously, safety is the most important thing for everyone. We don't want to create an incident with this." She said the pipeline has met with union leaders "numerous times" but has been unable to come to an agreement.

"The clearing represents only about 3% of our contract budget," she noted, adding that the clearing contractor will use a non-union work force numbering about 70. "The majority of the work is pipeline construction, which represents about 80% of the budget, and all that work will be done by union contractors [employing about 400 union workers]. So the ironic thing is that unions are holding up the clearing, which could ultimately impact the work that is to be done by union contractors.

"Our biggest concern right now is that this could delay the project in bringing gas to Saint John and surrounding areas and could impact the overall cost of the project, raising the tolls."

The $60 million lateral is designed to deliver gas produced by the Sable Offshore Energy Project to domestic customers in New Brunswick. The proposed 16-inch, 63-mile line will transport gas from Maritimes' mainline near Big Kedron Lake to the City of Saint John. About 102,000 MMBtu/d of capacity on the lateral is under contract with New Brunswick Power, Irving Oil and JD Irving. Another 62,000 MMBtu/d has been set aside to serve the new local distribution company being formed by Enbridge.

Jenkins said Maritimes stands by its decision to use HEF Industries for the clearing work. She said the pipeline is in the process of examining its legal options. The clearing contractor was selected through a fair and open tender process, she added.

Meanwhile, the Point Tupper lateral remains under close NEB scrutiny following several pipeline failures during testing at the beginning of the year. The company still has not been given authorization to open Point Tupper or to assume ownership of the lateral from the Sable Offshore Energy Project.

Construction is going smoothly on the Halifax lateral. The project is on schedule to me in service in November. The Halifax lateral initially will transport 61,600 MMBtu/d to Nova Scotia Power and other customers in Nova Scotia and will have another 62,400 MMBtu/d of capacity for future markets, including the LDC being developed by Sempra Gas Atlantic.

Rocco Canonica

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