Canadian review panel to report Thursday on Northern Gateway pipeline to the Pacific Coast

TORONTO – A panel reviewing a proposed pipeline to the Pacific Coast that would allow Canada’s oil to be shipped to Asia will on Thursday deliver its recommendation on whether Canadian government should approve the project.

Canada’s National Energy Board said Tuesday the environmental report by the three-person review panel will be released Thursday in Calgary, Alberta. The final decision on whether Enbridge’s controversial pipeline can go ahead, however, rests with Canada’s Conservative government.

Prime Minister Stephen Harper has staunchly supported the pipeline after the United States delayed a decision to approve TransCanada’s Keystone XL pipeline that would take oil from Canada to the U.S. Gulf Coast.

The Northern Gateway pipeline would be laid from Alberta’s oil sands to the Pacific to deliver oil to Asia, chiefly energy-hungry China.

There is fierce environmental and aboriginal opposition in Pacific Coast province of British Columbia. Opponents fear pipeline leaks and a potential Exxon Valdez-like disaster on the pristine Pacific coast. About 220 oil tankers a year would visit the Pacific coast town of Kitamat. The pipeline would transport 525,000 barrels of oil a day.

“This report will detail the panel’s recommendation to the federal government on whether or not the project should be approved and the reasons for this recommendation,” the Joint Review Panel said in a statement. “The report will also include terms and conditions that the applicant must implement if the project is approved.”

Harper has said Canada’s national interest makes the $5.5 billion pipeline essential. He was “profoundly disappointed” that U.S. President Barack Obama rejected the Texas Keystone XL option but also spoke of the need to diversify Canada’s oil industry. Ninety-seven per cent 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.

Critics, however, dislike the whole concept of tapping the oil sands, saying it requires huge amounts of energy and water, increases greenhouse gas emissions and threatens rivers and forests. Some projects are massive open-pit mines, and the process of separating oil from sand can generate lake-sized pools of toxic sludge.

Meanwhile, China’s growing economy is hungry for Canadian oil. The Chinese have invested billions in the Alberta oil sands.

“The Chinese have been monitoring this very closely,” Wenran Jiang, an energy expert and professor at the University of Alberta said from Beijing. “They know it is extremely controversial and it is a long short. They know it’s not going to be built for a few years. While they still consider it vital they know the process is difficult.”

He expects the project to be approved by the review panel, but said people are preparing for hurdles beyond National Energy Board and federal government approval.

“It is so contentious. Even NEB approval of Gateway will not mean the end of it,” he said. “People are wondering what the hurdles will be with the British Columbia government, aboriginal groups and with very strong sentiments from environmental groups. Even with regulatory official channels cleared, I think everybody knows it will be a very difficult road ahead.”