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Canada makes decision on key pipeline projects

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World Pipelines,

The Canadian Prime Minister, Justin Trudeau, has reached a decision on three key pipeline proposals. He has approved two major pipeline projects, which will transport crude oil from Alberta to the Pacific coast. The oil will eventually reach Chinese markets. In turn, this will provide a long-awaited boost to Canada’s exports and, more generally, its oil industry, while reducing its reliance on the US market.

The two projects that have won Canadian government approval are the Trans Mountain and Line 3 pipeline projects, proposed by Kinder Morgan and Enbridge, respectively. Meanwhile, Trudeau has rejected Enbridge’s controversial Northern Gateway project, citing excessive risks.

According to Bloomberg, the Prime Minister has sought to balance environmental protection with the need to expand markets for Canada’s resources.

“There isn’t a country in the world that would find billions of barrels of oil and just leave it in the ground while there is a market for it,” Trudeau said at a press conference.

“Our duty is to permit infrastructure so Canada’s resources get to market in a more environmentally responsible way, creating jobs and a thriving economy,” he added.

While supported by Canadian oil sands producers, Enbridge’s yearslong attempt to pursue its plans for the Northern Gateway pipeline sparked extensive protests. The company has faced fierce opposition from aboriginal and environmental groups across North America in recent years. The Guardian noted that Trudeau himself has long opposed the project, which would have carried 525 000 bpd of crude oil along 730 miles.

The company will, however, be able to replace the Canadian segments of its ageing 1967 Line 3 pipeline that runs between Alberta and Wisconsin.

Kinder Morgan’s CAN$6.8 billion (US$5.06 billion) Trans Mountain project would nearly triple capacity on the artery to 890 000 bpd. However, the project’s approval is subject to 157 conditions relating to indigenous and environmental issues. It is also subject to regulatory approvals. The company plans to increase shiploads of crude oil to foreign markets to 34 ships per month from the current five.

As expected, the responses have been varied.

“There’s an international demand for Canadian oil, and this pipeline is an important part of getting our product to market,” said Perrin Beatty, President and CEO of the Canadian Chamber of Commerce, in a press release.

The Guardian highlighted: “Greenpeace said the decision would lead to “Standing Rock-like protests” in Canada.”

VICE reported: “The approvals will mean that Canada will increase its oil transportation capacity by more than 1.1 million bpd, compared with a 2015 daily average of 4 million bbls. That’s good news for Canada’s struggling oil industry, beset by low oil prices and a lack of transportation infrastructure.”

Trudeau also announced that his government will introduce a bill in spring of 2017 that would put a Moratorium on oil tankers along British Columbia’s north coast, spanning Alaska to the north tip of Vancouver Island.

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