British Columbia bomb attacks won’t stop sour gas development
Development of dangerous natural gas reserves will continue in northeastern B.C. despite anonymous guerrilla pipeline bombings
The City of Fort St. John, District of Chetwynd and Peace River Regional District urged the NEB to send the industry back to its drawing boards. The Redwillow pipeline will simultaneously rob the communities of benefits from tapping B.C. resources, amplify risks of sour gas accidents and hold back other economic development, municipal leaders predicted.
“B.C. has the space and capacity to process this gas,” Fort St. John city manager Dianne Hunter wrote in a letter to the NEB. “Plus, the estimated hydrogen sulphide content of the gas being transported in combination with the length of the proposed pipeline is extremely dangerous to citizens… the district has over 4,000 people within nine kilometers of the proposed emergency planning zone [for evacuations in case of leaks].”
Additional economic concerns voiced by northeastern B.C.’s biggest city were echoed by the Peace River Regional District’s chief administrative officer, Fred Banham. Sour gas safety precautions jeopardize other potential industry, he wrote in a letter to the NEB.
“The plan calls for a 30-kilometer development setback along the length of the pipeline corridor. This size of setback is extremely restrictive to new development in an economically developing region. While there may be nothing or very little there today, mining, forestry and oil and gas are quickly developing in and around the entire proposed corridor area,” Banham wrote.
The buffer zone along the pipeline is among about two dozen NEB approval conditions covering issues from sour gas safety engineering to emergency response planning and community
safety drills. The package largely adopts standard practices enforced by Alberta’s Energy Resources Conservation Board, which every year deals with numerous sour gas cases.
Besides aggressive protesters, the NEB worked its way through financial turmoil in order to approve the new sour gas pipeline. Sponsor SemCAMS Redwillow ULC belongs to a corporate family in the United States, SemGroup L.P., that last summer obtained bankruptcy protection against creditors in American and Canadian courts.
The board accepted assurances that the pipeline project can be financed separately on its own merits. The sponsor’s assurances were supported by the court-appointed company monitor in the bankruptcy case, Ernst & Young Inc. Shippers have covered the costs, and assured SemCAMS Redwillow of reliable revenues, by signing gas transportation contracts that require payment for space bookings on the pipeline regardless of whether they use the service not at any particular times.
An initial “anchor group” of customers for the pipeline includes Husky Oil, Shell Canada, BG International and Suncor Energy. Numerous other Canadian producers are also active in the region. Devon Canada Corp. and ConocoPhillips Canada supported the sour gas project during the NEB regulatory review.
The project is forecast to encourage further drilling. A 2006 review by the B.C. Energy Ministry predicts that 5.8 trillion cubic feet of reserves can be tapped in the region which will be served by the new Redwillow pipeline.
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