Canadian regulator recommends oil pipeline to Pacific Coast

TORONTO – Canada’s regulator recommended Thursday the government approve a proposed pipeline to the Pacific Coast that would allow Canada’s oil to be shipped to Asia.

A three-person review panel said opening Pacific markets to Canadian oil is important to the economy and thus supported Enbridge’s controversial pipeline. There are 209 conditions, but no major potential stumbling blocks such as a route change.

Natural Resource Minister Joe Oliver said the government will review the report and consult with affected aboriginal groups before making a decision. Prime Minister Stephen Harper’s Conservative government has staunchly supported the pipeline after the United States delayed a final decision on TransCanada’s Keystone XL pipeline that would take oil from Alberta to the U.S. Gulf Coast.

The Northern Gateway pipeline would transport 525,000 barrels of oil a day from Alberta’s oil sands to the Pacific to deliver oil to Asia, mainly energy-hungry China.

There is fierce environmental and aboriginal opposition and court challenges are expected. Opponents fear pipeline leaks and a potential Exxon Valdez-like disaster on the pristine Pacific coast. About 220 large oil tankers a year would visit the Pacific coast town of Kitamat.

Harper has said Canada’s national interest makes the $7.4 billion pipeline essential. He was “profoundly disappointed” that President Barack Obama delayed a U.S. decision on the Texas Keystone XL option, and spoke of the need to diversify Canada’s oil industry. Ninety-seven percent of Canadian oil exports now go to the U.S.

The Keystone XL pipeline and the Northern Gateway project are critical to Canada, which needs infrastructure in place to export its growing oil sands production. The northern Alberta region has the world’s third largest oil reserves, with 170 billion barrels of proven reserves.

The Joint Review Panel of energy and environmental officials spent two years canvassing opinion along the 731-mile route of the Northern Gateway pipeline.

The National Energy Board’s panel’s conditions cover everything from protecting caribou habitat to research into how the oil would behave in the ocean. The panel said Enbridge must carry liability coverage of $950-million.