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Canada walks oil pipeline tightrope

Government backs a pipeline expansion project that, once completed, could be bigger than Keystone XL.

By Daniel J. Graeber
Canada walks oil pipeline tightrope
Prime Minister of Canada Justin Trudeau draws mixed reactions with his decisions on national pipeline infrastructure Pool photo by Peter Foley/UPI | License Photo

OTTAWA, Nov. 30 (UPI) -- Canada's prime minister balanced the debate on oil infrastructure by delivering split decisions that drew industry praise and complaints from environmentalists.

Prime Minister Justin Trudeau signed off on the Trans Mountain oil pipeline from Kinder Morgan and the lesser-known Line 3 from Enbridge, but sidelined the controversial Northern Gateway project.

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Canada last year was the fourth largest producer of oil and natural gas liquid in the world. Crude oil production in 2015 was 3.9 million barrels per day and most of that was shipped either to western provinces or to the United States through pipelines.

An annual report from the National Energy Board said export capacity is constricted because pipeline capacity hasn't kept pace with production.

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Kinder Morgan petitioned the federal Canadian government to expand the existing west-bound Trans Mountain pipeline network to triple its capacity to around 890,000 barrels of oil per day. Early this year, the provincial government in British Columbia said it wasn't confident the company had done enough to address spill potential from the system.

Enbridge was working to lay new infrastructure with Northern Gateway.

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Canada relies on the United States almost exclusively as an oil export destination and the government in Ottawa has worked to expand its trade reach to Asia. Less than 1 percent of its oil is exported now outside of North America.

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Tim McMillan, the president and CEO of the Canadian Association of Petroleum Producers, said the Trudeau administration made good infrastructure decisions that struck a balance between energy needs and environmental concerns.

"The government's commitment to energy infrastructure shows that they are interested in balancing Canada's sustained leadership and prosperity," he said in a statement.

The provincial government of British Columbia laid out a series conditions for the approval of Kinder Morgan's pipeline expansion, which said a comprehensive effort was needed to meet all the spill response requirements. Kinder Morgan's expansion could be bigger than Keystone XL oil, a U.S-bound project sidelined by Washington on environmental grounds.

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Lena Moffitt, a director at Sierra Club, said Trudeau had moved in a favorable direction with some of the decisions, but there was no room for error.

"The climate crisis leaves no room for additional tar sands pipelines," she said in an emailed statement.

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