Canada west-east oil pipeline would drive up GHG emissions – group

07 February 2014 19:27  [Source: ICIS news]

TORONTO (ICIS)--TransCanada’s proposed 1.1m bbl/day cross-country west-to-east oil pipeline would drive up Canada's greenhouse gas (GHG) emissions, according to an environmental report on Friday.

TransCanada proposed the "Energy East" project last August to ship oil from western Canada to refineries in the country's east, and for export.

Energy East would be especially important for the Calgary-based energy infrastructure major should the US not approve the northern leg of the company’s long-delayed Keystone XL oil pipeline from Alberta province to the US.

Canadian environmental research group Pembina Institute said in a report that Energy East would result in an additional 30m to 32m tonnes/year of carbon dioxide (CO2) emissions, "an even greater impact" than Keystone XL with an estimated impact of 22m tonnes/year.

Pembina urged Canadian regulators, when deciding on Energy East, to take into account the "full upstream impact" from increased oil sands-based crude production the project would prompt in Alberta.

However, a TransCanada spokesman told media that Energy East would not substantially increase oil sands extraction in Alberta. Rather, it would replace or prevent imports of oil into eastern Canada from regions with weaker environmental regimes than Canada.

The Pembina report contrasts with findings on Keystone XL by US State Department last week.

In a report, the department said that not building Keystone XL could lead to an increase in GHG emissions. Without the pipeline, the oil would be shipped by railcar and tanker, resulting in increased diesel and fuel consumption. The department also noted the risks of oil railcar shipments, which have sharply increased in recent years because of tight pipeline capacities in North America.

US President Barack Obama said last year that a final approval of Keystone XL would depend on whether the project will add to GHG emissions. However, it still remains unclear when or whether the US will approve the project, even as Canada's government stepped up its pressure and lobbying in favour of Keystone XL in past months.

Meanwhile, Canadian oil, refining and petrochemicals major Suncor said this week that it expanded oil railcar shipments to supply its Montreal refinery with crude from western Canada and elsewhere. Suncor would be a key shipper on Energy East, if that project is built.

Additional reporting by Jeremy Pafford and Joe Kamalick

By: Stefan Baumgarten
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