Kinder Morgan receives final Canadian approval for $5.4 billion pipeline project

Kinder Morgan received the final environmental approval from British Columbia to proceed with its $5.4 billion Trans Mountain oil pipeline expansion.

The project to ship heavy crude from oil sands in Alberta to Vancouver-area ports in British Columbia was previously approved in November by Canadian Prime Minister Just Trudeau. The new British Columbia certificate means Kinder Morgan has met 37 environmental conditions in exchange for support of the 715 miles of heavy oil pipelines. The most opposition has come from the heavily populated Vancouver regions, environmental groups and some indigenous populations.

Kinder Morgan tentatively plans to start construction in September and to to have the twin pipeline system fully operational by late 2019. The Trans Mountain expansion would almost triple its existing capacity from 300,000 to 890,000 barrels of crude oil per day. The pipeline project extends near Vancouver ports, where the oil can be shipped to Asian markets that typically pay steeper prices. The expansion would lay another pipeline next to the company’s existing one, which began operations in 1953.

“We believe this represents a positive outcome for our company, customers and for British Columbians and all Canadians who will benefit from the construction and operation of an expanded pipeline,” Kinder Morgan Canada President Ian Anderson in a prepared statement.

As part of a negotiated commitment, Kinder Morgan agreed to donate from $25 million to $50 million a year, depending on shipments in excess of contracted volumes, over the 20-year life of the project to a new B.C. Clean Communities Program.