Bloomberg News

Enbridge Says Northern Gateway to Get Better Pipe, Monitoring

July 20, 2012

Enbridge Inc. (ENB), which is seeking to build an oil pipeline across the western third of Canada, said it will use thicker steel than previously planned for the line.

Enbridge will boost the thickness along the entire 1,177- kilometer (730-mile) pipeline and especially at river crossings, it said in statement today. The company also said it will spend more monitoring the line. The improvements will cost C$400 million to C$500 million ($397 million to $496 million), adding 9 percent to the projected cost.

Enbridge, owner of Canada’s largest oil-pipeline network, plans to install dual leak detection systems and permanently staff remote pumping locations, the company said.

“After years of consultation with stakeholders and after personally attending many regulatory hearings for Northern Gateway, it has become clear -- we have to do everything we can to ensure confidence in the project,” said Executive Vice President Janet Holder said in the statement.

Enbridge has previously said the pipeline will cost C$5.5 billion. It will cross territory claimed by aboriginal groups including the Saik’uz First Nation and other members of the Yinka-Dene Alliance, a group of aboriginal communities in central British Columbia which opposes the proposed pipeline.

Enbridge is counting on growing demand for the fossil fuel in Asia. The company has come under fire for its handling of a 2010 spill which poured 20,082 barrels of oil into a river in Michigan and cost more than $800 million to clean up.

Different Than Michigan?

“I can’t see us being any different than Michigan,” said Jackie Thomas, the elected chief of the Saik’uz Nation, in a phone interview today. “Enbridge makes a lot of assumptions about what will happen with a spill -- like the Coast Guard and other government agencies will clean up. With all the cuts, that’s not going to happen.”

The pipeline would terminate in the town of Kitimat, on the Pacific coast of British Columbia. An oil spill on the coast would involve a complicated cleanup, reminiscent of the Exxon Valdez disaster on the Alaskan coast in 1989, according to the Pembina Institute, a Canadian environmental research organization.

To contact the reporter on this story: Jeremy van Loon in Calgary via jvanloon@bloomberg.net

To contact the editors responsible for this story: Susan Warren at susanwarren@bloomberg.net


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