Backgrounder: Threats from Tankers in BC’s Inside Passage

June 26, 2006

The moratorium on offshore oil and gas and tanker traffic has been protecting British Columbia’s northern coast since 1972.

Natural Resources Canada most recently confirmed the moratorium in 2003 when it tasked the Royal Society of Canada to conduct a public review of the BC Offshore Oil and Gas Moratorium, stating: “In 1972, the Government of Canada imposed a moratorium on crude oil tanker traffic through Dixon Entrance, Hecate Strait and Queen Charlotte Sound due to concerns over the potential environmental impacts. The moratorium was subsequently extended to include oil and gas activities. This was followed by a similar prohibition by the Government of British Columbia.”

Following its review, the Royal Society of Canada concluded that: “The present restriction on tanker traffic in transit along the West Coast of North America from entering the coastal zone should be maintained for the time being.”

However, since 2001 the federal government has been under pressure from the provincial government, and oil and gas companies to lift the moratorium.

The threats to the BC northern coast and the global environment from the oil and gas industry are numerous and include the risk of oil spills and climate change. Increased tanker traffic will only intensify these risks, in particular considering Kitimat is 150 km up narrow channels and fjords from the open ocean, making travel extremely hazardous, especially in winter. Environment Canada says that we can expect more than 100 small spills, about 10 moderate spills and at least one major spill every year at current proposed levels of tanker traffic.

There are currently six projects that will threaten BC’s fragile inside passage with tankers:

1. Methanex, in partnership with Alberta-based Encana, is currently importing condensate, a natural gas byproduct used to dilute thick crude oil, in oil tankers to Kitimat where the dilutant is being offloaded onto railway cars for transport to Alberta. The condensate, a toxic mix of chemicals and petroleum derivates needed to ease the flow of oil through pipelines, is being imported from Belize and other places in South America as well as Asia. The condensate tankers (50,000 dwt) carry approximately 350,000 barrels of condensate.
2. Alberta-based energy giant Enbridge is seeking approval of a $4 billion project that would bring oil tankers into BC’s inside passage to ship 800,000 to 1,000,000 barrels per day of exported tar sands crude oil from a pipeline originating in Alberta to destinations in China, India and California. Three to ten tankers per week would travel 100 kilometers through the inside passage and coastal waters, another 140 kilometers up a fjord to transport crude from an oil tanker terminal in Kitimat, BC.
3. Both Enbridge and Kinder Morgan are seeking approval for competing pipelines that would transport 150,000 and 100,000 barrels per day each in imported “condensate” off tankers in Kitimat into a 1,200 km long pipeline bound for Alberta. Both these proposals are currently seeking regulatory approval.
4. Kitimat LNG has received a provincial environmental assessment certificate for a Liquefied Natural Gas (LNG) terminal in Kitimat. LNG is a very cold liquid natural gas approximately -260° F), containing mostly methane, but typically including other “hot” or “wild” hydrocarbons such as ethane and propane, and other toxic contaminants. Proposed LNG terminals are facing stiff opposition from communities across North America, with communities as diverse as Quebec City, Passamaquoddy Bay on the border of Maine and Nova Scotia, Malibu, Homboldt, Vallejo, Long Beach and Oxnard in California, Boston and Fall River in Massachusetts opposing LNG projects for environmental, security and health reasons.
5. Recently Pembina announced the $700 million Condensate Pipeline Project which if approved would transport 100,000 barrels a day of condensate from Kitimat to Summit Lake north of Prince George.  From there Pembina will reverse the flow of existing pipeline currently carrying crude to ship condensate to the tar sands.
6. Calgary-based Westpac Terminals are proposing an LNG terminal on Ridley Island, just south of  Prince Rupert. The facility would include a cryogenic storage tank for at least 150,000 cubic metres of gas, receiving gas shipped from places such as Indonesia, Malaysia, Australia, Qatar, Russia and Alaska. The formal environmental assessment process began earlier this month..

Industry considers a 15% recovery of an oil spill a success; even in perfect conditions. A full recovery has never been achieved. Given that weather on the BC coast can be quite extreme with winds at over 25 knots in winter and waves reaching three stories in height- any spill in this region would have devastating environmental and economic consequences.