Hope is slated to be a construction hub for the proposed Trans Mountain pipeline expansion project.
Greg Toth, senior project director with Kinder Morgan, attended a local Chamber of Commerce luncheon on Monday to present a progress report and discuss the local economic opportunities.
“We see this project as an important boost to B.C. and Alberta construction industries and at the same time it will allow Canada to access the world markets and receive full value for its resources,” he said. “But our approach at Kinder Morgan is very much focused locally. We’re looking at what we can to do maximize local and regional benefits.”
Kinder Morgan is proposing to twin its current 1,150-kilometre Trans Mountain pipeline between Strathcona County (near Edmonton, Alta.) and Burnaby. The current pipeline transports refined products, as well as synthetic, light and heavy crude oils. According to Kinder Morgan, the company supplies about 90 per cent of petroleum products to the B.C. market.
The proposed $5.4-billion expansion, if approved, would increase the nominal capacity of the system from 300,000 barrels per day to 890,000 barrels per day.
A comprehensive application with the National Energy Board is expected to be filed by the end of the year, which will initiate a regulatory review of the proposed expansion facilities. If the regulatory application process is successful, construction of the new pipeline could begin as early as 2016, with the expanded pipeline operational in 2017.
Kinder Morgan is currently investing in engineering designs and environmental studies for the proposed Trans Mountain expansion project, which carries an estimated price tag of $5.4 billion.
Operating costs over the first 20 years will add another $3 billion. This translates into $2.1 billion in additional federal taxes and $1.7 billion in additional B.C. and Alberta provincial taxes. Over 20 years, Kinder Morgan will also pay $500 million in additional municipal taxes, funding community services.
Toth said 4,500 jobs will be created at the peak of construction, with an emphasis on local hiring. Kinder Morgan is in the early stages of establishing the procurement process, but is exploring ways to increase access to local and Aboriginal suppliers.
The Hope construction hub would be the headquarters for about 85 kilometres of pipeline construction, spanning from Coquihalla Lakes to the Walhleach pump station. In addition to housing workers, the town would also be the base for construction yards, pipeline lay down areas, construction management, craft inspectors, environmental protection and monitoring, administration support services, and right-of-way restoration and remediation.
Hundreds of people will be needed for the Hope hub workforce. Pipeline construction employment includes logging and clearing, labourers, heavy equipment operators, welders, pipeline coating/soundblasting, trucks and drivers, and horizontal drilling/boring. There’s also many local subcontracts and services required to support pipeline construction.
“To construct this section, there’s going to be basically work going on almost through the course of a year-and-a-half,” said Toth. “It’s very difficult construction, some tight spots and close proximity to the highway. It’s a slower pipeline production, so it tends to be a smaller crew.”
Toth pointed out that construction is not only expected to provide temporary employment, but also an economic boost in the community as the workforce spends locally on accommodation, meals and recreation. Kinder Morgan also plans to implement legacy projects, form community partnerships, and provide training and education of the local workforce through direct employment and scholarships.
Despite the potential economic benefits, Hope resident Dennis O’Keeffe still has concerns about local oil spill response times and the environmental impacts. He said actions should be taken by Kinder Morgan to upgrade the existing 60-year-old pipeline to today’s standards by the National Energy Board, despite Toth assuring him that it meets industry requirements. O’Keeffe would like to see pipeline steel doubled to 1/2” thick where it crosses over or under the Coquihalla River and shut-off valves installed on each side of the river along with containment tanks.
“With the response time of possibly up to an hour-and-a half maximum, and no shut off valve near the Coquihalla River, if there was a major rupture, there’s a lot of oil that could flow into the river and that would be devastating,” he added.
Toth pointed out that Kinder Morgan does have a comprehensive integrity management program in place to ensure pipeline soundness and reliability, safety of the public and employees, and protection of the environment. Preventative measures include ground and air patrols of the pipeline, inline inspection equipment, and a state-of-the-art control centre that monitors the pipeline 24-7. Toth also said Kinder Morgan recently conducted voluntary pressure testing on a 35-km section of the Trans Mountain pipeline through the Coquihalla area between Merritt and Hope. Known as hydrostatic testing, the procedure involved shutting down the pipeline for the test period, draining a section of the pipeline of petroleum and filling it with water. The water was then pumped up gradually to a pressure higher than the maximum operating pressure and held at that pressure for a period of time. The pipeline currently operates at 80 per cent of its pressure capacity.
Anyone who suspects they’ve found a leak is asked to contact Kinder Morgan immediately through the Trans Mountain emergency line at 1-888-876-6711.