Mike Priaro, P.Eng.
 

 

 

 

 

 

 

 

—the late former Alberta Premier The Hon. Peter Lougheed

 in an interview on September 13, 2011.

 

 

On December 16, 2013 Kinder Morgan filed application to the National Energy Board to expand its TransMountain Pipeline to the West Coast.

 

The application contains five major flaws —any one of which ought to be fatal.

 

 

The first is that Kinder Morgan has not applied to relocate the TransMountain pipeline’s Westridge marine terminal from Burnaby, BC to Tsawwassen/Delta.

 

By purchasing BC Ferries’ Tsawwassen terminal (cover photo above), all tanker traffic would be removed from Vancouver’s central and inner harbours, from underneath the Second Narrows and Lions Gate bridges, past Stanley Park, from Burrard Inlet, and from a good part of the Salish Sea. 

 

Deep water at Tsawwassen would allow safe loading of much larger tankers, reducing additional Salish Sea tanker traffic by three-quarters.  The Burnaby mountain tank farm could be dismantled and pipelines through Burnaby, the third most densely-populated municipality in the Lower Mainland, would no longer be required. 

 

A Tsawwassen marine terminal also eliminates two major pipeline crossings of the Fraser River.  And it would eliminate the need to bring jet-fuel tankers up the Fraser River to a new jet-fuel marine terminal at Riverport and eliminates a new jet-fuel pipeline through Richmond. 

 

Proceeds from the sale would allow BC Ferries to construct a new terminal near Vancouver’s airport, reducing Island transit times, not the same as crossing times, by half for many Lower Mainlanders and Islanders —and making  airport/ferry/LRT connections fast and efficient.  One option is to expand and extend the Iona Spit jetty for the new ferry terminal.

 

Other options include enlarging the Deltaport coal/container terminal to include a marine tanker terminal (Option 2) or adding a new jetty just north of the coal/container terminal (Option 3) as shown below.

Tankage associated with a new marine terminal would be safely located on the mainland while tankers would be loaded from a mooring buoy (Option 4) supplied by a line on a trestle or underwater.

 

Kinder Morgan estimated running a line along the Roberts Bank rail corridor would cost an additional $1.2 billion but this needs to be documented and cmpared to the economic cost of an oil spill in Vancouver's inner and central harbours and Burrard Inlet or in the Fraser River.

 

Re-locating the Westridge marine terminal to Tsawwassen/Delta might provide incentive for Chevron, or a Canadian competitor like Irving Oil, to replace and relocate the small, marginally-economic Burnaby refinery (shown below):

eliminate the pipeline's Burnaby Mountain tank farm (shown below);

 and eliminate the Chevron refinery's tank farm and marine loading wharf (shown below):

A world-leading, show-piece refinery like Irving Oil’s refinery in Saint John NB (shown below), Canada’s largest refinery, has reached production rates in excess of 320,000 bbl/d.  In 2003, Irving Oil became the first oil company to receive a US Environmental Protection Agency Clean Air Excellence Award for its clean gasoline.

 

The Irving refinery exports over 80 per cent of its production to the US and accounts for 75 per cent of Canada’s gasoline exports to the US and 19 per cent of all US gasoline imports.

Such a refinery could meet all of the Lower Mainland’s and Islands’ needs for petroleum products as well as exporting refined products. 

 

Higher than average refining margins due to lack of competition in the Lower Mainland have cost BC consumers roughly $2.7 billion since 2010 according to a study by Navius Research: Refining Margins in British Columbia: Examining the Renewable and Low Carbon Fuel Regulation Requirement in the Context of Refinery Net-Revenues, Michael Wolinetz, Navius Research Inc. February. 2015.

See:  http://www.naviusresearch.com/data/resources/Refining_Margins_%20and_the_BC_Clean_Fuel_Regulation_Navius.pdf

 

 

A new refinery could be supplied by a pipeline along an expanded existing CN Roberts Bank Rail Corridor right-of-way, without having to cross the Fraser River, before connecting to the existing and expanded TransMountain Pipeline right-of-way at approximately location 21 on the map below:

Details of the Roberts Bank Rail Corridor intersection with the proposed TransMountain Pipeline ROW near Fort Langley are shown below:

A 150-metre wide Assessment Corridor is used for environmental impact assessment (EIA) studies and does not reflect the ultimate width or footprint of any proposed pipeline construction.  A pipeline’s construction footprint will typically be 45 metres wide and includes the registered easement (or operational corridor) that is typically 18 metres (60 feet) wide.

 

A refinery at Delta/Tsawwassen eliminates the in-river vessel movements, Fraser River marine terminal, fuel receiving facility and jet-fuel pipeline through Richmond, eliminates fuel barge traffic from U.S. refineries through the Salish Sea, and eliminates the need to import jet fuel.  Jet fuel could be barged directly from Tsawwassen to the airport as shown below:

 

 

 

 

The third fatal flaw is that Kinder Morgan’s application makes no provision for the creation of a strategically-located, world-leading, oil-spill response centre.  The existing Western Canada Marine Response Corporation (WCMRC) falls far short on response times, personnel availability, knowledge, experience, and equipment to handle a large dilbit spill in the Salish Sea, or anywhere else.

 

This was highlighted by the disconcertingly slow and inadequate response to a relatively small spill estimated at 17 bbl (2700 litres) of Bunker C fuel from a cargo ship anchored off English Bay on April 9, 2015.

 

From an article in the Daily Oil Bulletin by Elsie Ross on April 13, 2015: 'Last week’s bunker fuel oil spill in Vancouver’s English Bay has demonstrated the Canadian federal government’s lack of world-class marine spill response preparedness, said British Columbia Premier Christy Clark.  The 18-barrel spill, which originated from a grain bulk carrier, could affect pipeline proposals exporting heavy oil off the B.C. coast, she said in a news conference April 10. “There won’t be any expansion of heavy oil out of this port or any other port in British Columbia until we get a world class spill response,” she said.'

 

 

A world-leading spill response centre should be a public entity overseen by local, provincial, and federal governments, including First Nations, but funded by crude producers, crude buyers, the pipeline company, marine shippers, the Province of Alberta, and the federal government  —not British Columbians.

 

It might be possible to negotiate with U.S. Salish Sea and Puget Sound jurisdictions, regulators, and industry to co-operate on a joint Canada-US spill-response centre.
 
Conventional crude oil spills will generally float, emulsify, and/or evaporate depending on time, volatility, water temperature, wave action, and on density which is always less than fresh water.  Unfortunately, recovery of a dilbit spill is likely to be very, very low while ecological and property damage is likely to be very, very high . It is difficult to predict whether and how long dilbit will float, have neutral buoyancy, or sink with weathering and sediment uptake making spill clean-up extremely difficult and costly—if not impossible.  In fact, a dilbit spill could exhibit all three types of behaviour, floating, neutral buoyancy, and sinking simultaneously while unrecovered bitumen will never evaporate.

 

 

 

 

The findings of the fire safety and risk analysis TransMountain Tank Farm Tactical Risk Analysis Date: 2015 May 01 by Burnaby Deputy Fire Chief Chris Bowcock raised serious concerns over selection of the Burnaby Mountain Terminal for the densification of oil storage tank use.

 

Based on the findings of the analysis, the Burnaby Mountain Terminal is not the appropriate location for the expansion of the Burnaby Mountain Terminal as it poses significant constraints from an emergency/fire response perspective, including but not limited to safety of firefighters and effectiveness to combat fire; containment and extinguishment of fire/spill/release; evacuation of employees within the Burnaby Mountain Terminal facility; evacuation of adjacent neighbourhoods, as well as broader areas impacted by release of sulfur based gases and toxic smoke plumes; and, protection of adjacent properties, including conservation lands.

 

Additionally, the proposed TransMountain expansion lacks appropriate consideration for original facility fire protection premises and industry best practices in petroleum storage and fire protection, as the proposal only seeks to comply with minimum federal and provincial code requirements.

 

See: http://www.burnaby.ca/AssetFactory.aspx?did=16919

 

Summary 
 
The elimination of dilbit transportion by pipelines, tankers or other means and the elimination of raw bitumen and extra heavy crude exports must be the imperative goal of Albertans. However, this will require one or two decades to achieve.

 

British Columbians have an opportunity to play a key positive role in achieving the important environmental and economic goal of eliminating the transport and export of raw bitumen as dilbit by demanding an agreement that dilbit volumes using an expanded TransMountain pipeline be phased out in the face of a stiff, escalating levy. 

 

Such a levy will recover some of the economic benefits lost to Canadians by the export of raw bitumen and by the high costs of diluent (i.e, the "diluent penalty" - see The Case for Partial Upgrading of Raw Bitumen in Alberta elsewhere on this website) and compensate British Columbians for the disruptions and risks of an expanded TransMountain pipeline.

 

Mike Priaro, P.Eng.
Calgary, Alberta
 

"Mike Priaro, B.Eng.Sc. (Chem. Eng.), U.W.O. '76, P.Eng., Lifetime Member Association of Professional Engineers and Geoscientists of Alberta (APEGA), worked in facilities, production, operations and reservoir engineering, as engineering consultant, area superintendent, and engineering management in Alberta's oil patch for 25 years for companies such as Amoco and PetroCanada.”

“He increased oil production from the historic Turner Valley oilfield and brought in under-balanced drilling technology to drill out, complete, and test several of the highest producing gas wells ever on mainland Canada at Ladyfern.  He co-authored ‘Advanced Fracturing Fluids Improve Well Economics’ in Schlumberger's Oilfield Review and developed the course material for the ‘Advanced Production Engineering’ course at Southern Alberta Institute of Technology.”

 

“Mike has presented his work to Canada’s House Committee on Natural Resources in Ottawa and had work published by the Macdonald-Laurier Institute in the March and April, 2014 and february, 2015 editions of Inside Policy magazine, by U.S. energy industry websites such as RBN Energy, in the July 17, 2014 edition of the Oil and Gas Journal, and in Petroleum Technology Quarterly Q3 2014.”

“Mike has no formal connection to any oil company, environmental organization, think tank, labour organization, lobbying or special interest group, academia, or to provincial or federal politics.”  However, Mike has been recently retained by Alberta Sulphur Research Limited to help promote, prove, develop, and commercialize a new partial upgrading process.

"Mike has incidental, long-time ownership of a modest number of TransCanada Corporation common shares supplemented by purchase of a small number of additional shares in 2012.  Mike also owns a few common shares in several small resource companies."

“Mike is the author of  “A ‘Canada-First’ Canadian Energy Strategy”  (see https://www.behance.net/portfolio/editor?project_id=5808629 ) and is available for speaking engagements, special projects, and consulting work.”