August 2, 2013

New oil pipeline planned along Maine-Canada border

It would transport crude from Alberta to New Brunswick, skirting Maine and likely reducing the need for trains.

By Dennis Hoey dhoey@pressherald.com
Staff Writer

A Canadian company announced plans Thursday for a $12 billion pipeline capable of transporting 1.1 million barrels of crude oil per day – including the controversial "tar sands" oil from Alberta – over the northern tip of Maine and down its eastern border with New Brunswick.

A map posted on TransCanada Corp.'s website shows the proposed Energy East Pipeline ending in Saint John, New Brunswick, but spokesman Grady Semmens said it could be months before a route can be finalized with landowners and tribal nations.

Semmens said the pipeline would be capable of transporting a "wide range of crude oils, including heavy oil produced in the oil sands region as well as light oil from the Bakken region" of North Dakota and Saskatchewan.

Though the pipeline would not enter Maine, it would skirt the state's border with New Brunswick, according to TransCanada.

Groups such as Environment Maine and the Sierra Club have said that Portland Pipe Line Corp. plans to transport tar sands oil from Montreal to its terminal in South Portland, reversing the current flow of oil from Maine to Canada.

Portland Pipe Line officials have said they have no immediate plans to transport tar sands oil through the pipeline, which runs past Sebago Lake, the drinking water supply for Greater Portland.

In a prepared statement Thursday, Jim Merrill, a spokesman for Portland Pipe Line, said, "It is uncertain to us what the entire impact of this proposed project might be on crude movements and crude supplies for the East Coast. We are continuing to evaluate this recent development."

The project, which calls for construction of 870 miles of new pipeline, would have terminals in Montreal, the area around Quebec City and Saint John.

About 1,800 miles of existing natural-gas pipeline, mostly in western Canada, would complete the line. The gas pipeline would have to be converted to transport oil.

A lack of pipelines has led to a dramatic increase in transporting oil by train. A fiery train derailment that killed 47 people in Quebec last month highlighted the danger of moving oil by rail.

That Montreal, Maine & Atlantic Railway train was en route to the Irving Oil refinery in Saint John and would have crossed Maine.

Bank of Nova Scotia senior economist Patricia Mohr told The Associated Press that a pipeline would reduce the need to transport oil by train and would be a safer and less costly option.

Chop Hardenbergh, editor of the Atlantic Northeast Rails and Ports newsletter in Freeport, said, "My read on this ... it's all over for rail once that pipeline is in place."

He said such a pipeline would almost surely put a company like the Maine-based Montreal, Maine & Atlantic Railway out of business.

He said the rail line had become dependent on transporting crude oil until the disaster last month in Lac-Megantic, Quebec.

"Losing the crude to an oil pipeline is not good for rail in Maine, but at least we'll have another five years of crude by rail," he said.

Energy East Pipeline needs regulatory approvals. If everything goes according to TransCanada's plan, the pipeline could be delivering crude oil to Quebec by 2017 and to Saint John by 2018.

TransCanada's announcement, made at a news conference Thursday morning in Calgary, Alberta, drew criticism from Maine environmental groups.

Emily Figdor, executive director of Environment Maine, said such a pipeline would only increase Maine's reliance on an oil -- tar sands -- that she said is toxic and pollutes the environment.

"Overall, it's quite devastating news," she said.

Glen Brand, director of the Sierra Club's Maine chapter, said the pipeline would be bad for Maine even though it would skirt the state.

"TransCanada's announcement is certainly bad news for our fight against dirty tar sands oil," Brand said. "We are dedicated both in Maine, the United States and Canada to stopping the world's dirtiest oil from ever being brought to market."

The new pipeline, the most expensive in TransCanada's history, would run from Hardisty, Alberta, to Saint John, ending where a new deep-water marine terminal would be built by TransCanada and Irving Oil to handle the world's largest crude-carrying vessels, the AP reported.

TransCanada CEO Russ Girling said Canadian producers want access to international markets, but the primary purpose of the pipeline is to supply refineries in eastern Canada, which imports 750,000 barrels of foreign oil a day.

New pipelines are critical to Canada, which needs infrastructure to export its growing oil sands production from northern Alberta.

The region has the world's third-largest oil reserves, with 170 billion barrels of proven reserves, the AP reported. Daily production of 1.5 million barrels from the oil sands is expected to increase to 3.7 million in 2025. 

Dennis Hoey can be contacted at 791-6365 or at:

dhoey@pressherald.com

 

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