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TransCanada has asked for a 30-day suspension of its application for the Energy East pipeline that should transport crude oil from Alberta and Saskatchewan to the eastern part of Canada. According to the company, it wants to review the National Energy Board’s August decision to toughen the pipeline project assessment procedure.
In a statement, TransCanada suggested it might shelve the project overall if the new assessment procedure turns out to be too taxing on costs, schedule, and the viability of the project. NEB said it will decide on the request “in a timely manner”.
The decision of the watchdog to make rules tougher for oil and gas infrastructure builders earned it the praise of environmentalists but drew criticism from the industry, as was to be expected. For Energy East, this is yet another major setback, after last year some members of a panel overseeing the hearings on the project at NEB resigned over allegations of a conflict of interest.
At the start of this year, the regulator canceled all decisions the panel had made over the last two years and appointed a new one. At the same time, NEB itself is under intense scrutiny on criticism that it is playing in the oil industry’s field.
The US$13billion (C$15.7 billion) Energy East was planned to carry 1.1 million barrels of crude daily over 4,500 km to refineries in Eastern Canada and an export terminal in New Brunswick. The project is part of a response to the growing oil output in the oil sands that is putting a strain on the existing pipeline network in the country. This response is meeting with solid opposition from environmentalists and some local governments, such as that of British Columbia, which recently said it will do its best to block the expansion of another pipeline, Kinder Morgan’s Trans Mountain.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.