After numerous delays, TransCanada has finally filed for regulatory approval of its ambitious $12-billion Energy East project which, if approved, would be the longest and largest oil pipeline in North America.
The application was filed with the National Energy Board Thursday.
At more than 30,000 pages, the application is one of the most extensive ever, TransCanada CEO Russ Girling told a news conference in Toronto. “We are pleased with the application.”
TransCanada wants to convert its 40-year-old natural gas pipeline from Saskatchewan to Ontario, connect it with a new pipeline it plans to construct through Quebec and on to export terminals and refineries in New Brunswick. The 4,600-kilometre pipeline will run through six provinces, four time zones and carry up to 1.1 million barrels of crude oil every day. It is expected to lead to massive tanker exports from the Atlantic Coast, sending crude to the more profitable markets of Europe, India, China and the U.S.
Girling said about half the oil would be exported.
The project will also include construction of oil terminals in Saskatchewan, Quebec and New Brunswick.
TransCanada’s other high-profile pipeline proposal, the U.S.-bound Keystone XL, has been mired in the U.S. regulatory and legal process for over six years. Its cost will likely jump to $10 billion (U.S.) from $5.4 billion.
But Keystone isn’t the only pipeline proposal out of Alberta in limbo. Enbridge’s Northern Gateway project to the West Coast has a government permit to proceed but hopes of a 2018 start-up are slipping away as the company endeavours to get First Nations groups on its side.
Each pipeline issue is unique, said Girling, adding the company believes it can have Energy East “adjudicated in a reasonable time.”
TransCanada has held more than 80 open houses on Energy East across the country and “hundreds and hundreds” of one-on-one discussions. It has met with 155 First Nations groups, 60 of which have signed “letters of agreement.” The feedback will be incorporated into the NEB application, a TransCanada spokesperson said.
The energy board will now appoint a panel and convene hearings, among other things. It will take at least 18 months for the board to make any recommendations. If the proposal is approved, TransCanada will likely start construction in 2017 or 2018.
“This is the biggest thing that we have tried to do through a mechanism like the energy board,” said Warren Mabee, an energy policy expert at Queen’s University in Kingston. “It will also be the biggest in terms of the number of (provincial) governments, First Nations and other communities that will be involved in the discussions.”
Mabee said it will not be an easy ride for TransCanada.
“There will be a big difference with how Saskatchewan, Manitoba and Alberta react to it,” he said. “Their experience with pipelines is deeper and (they) have new pipelines being built all the time.”
Ontario and Quebec are most likely to raise red flags. “Ontario has the vast majority of the pipeline,” said Mabee, adding Quebec is undertaking an independent environmental assessment.
Quebec and Ontario have said they plan to intervene in the energy board review. Environmental agencies have also signalled they don’t favour the pipeline.
North Bay is one community where opposition is already obvious. Mayor Al McDonald said recently he will apply for intervenor status when the NEB application is filed.
TransCanada has learned from the mistakes it made with Keystone, said Mabee. “I think that they have engaged early and often with Energy East, and it is an improvement over the strategy they had five years ago with Keystone.”
Company representatives have been talking to communities. “Whether or not people are believing what they are being told is another question.”
Like Northern Gateway, the energy board will flag issues that must be dealt with to get this new project going, said Mabee.
“But it is big and it is exciting. It is a nation-building exercise and eventually it will get through, I think.”