April 13, 2018 – InsideClimate News
Canada’s Struggling to Build Oil Pipelines, and That’s Starting to Hurt the Industry
By Nicholas Kusnetz
Protests by Canada’s First Nations and opposition from British Columbia have put another planned tar sands pipeline, Kinder Morgan’s Trans Mountain, in jeopardy.
When the pipeline company Kinder Morgan announced it was suspending work on a major Canadian project that has been delayed by protests and court challenges, it sparked talk of a crisis north of the border and fears that investors may flee the nation's tar sands industry.
It was the clearest sign yet of how difficult it's become for energy companies to find new routes to export the country's landlocked oil, among the most expensive and damaging to the climate to produce. Over the past several years, climate activists and indigenous groups—in particular many of Canada's First Nations governments—have built a sustained campaign that has succeeded in delaying, and in some cases canceling, almost every attempt to send more Canadian oil to foreign markets.
Canada's tar sands hold one of the world's largest deposits of oil, but as the industry has expanded production over the past decade, it's been unable to complete new pipelines fast enough to ship it out.
The past few years saw the failure of two major pipeline projects that would have carried tar sands oil to the Atlantic and Pacific coasts of Canada, as well as the delay, demise and then revival of Keystone XL. This week's news on Kinder Morgan's Trans Mountain expansion, which is supposed to triple the capacity of an existing pipeline from Alberta to British Columbia's Pacific Coast, was the latest setback.
"With infrastructure projects like this, they don't need to be turned down or stopped by people, they just need to be delayed to the degree that it makes sense to place capital elsewhere," said Kevin Birn, an energy analyst with IHS Markit, a research firm.
RBN Energy issued a report saying producers in the tar sands—also called oil sands—are being forced to export more of their oil by rail, driving up costs. It warned that no new pipeline capacity is slated to come online for at least a couple of years, and that each of the three projects that have been approved—including Trans Mountain—face substantial opposition and hurdles.
Read the full article here: https://insideclimatenews.org/news/12042018/tar-sands-oil-pipeline-protests-canada-first-nations-kinder-morgan-trans-mountain-economics
