The National Energy Board (NEB) said Tuesday that it has approved applications for the Southern Lights Pipeline Project, worth an estimated $247.5 million in Canadian spending.
The Southern Lights Project broke new ground as the first application to
the NEB for a pipeline to transport diluent, which the Board identified as an
emerging market. Diluents are lighter hydrocarbons used to dilute bitumen and
heavy oil so they can flow through pipelines.
The applications submitted by Enbridge Southern Lights GP on behalf of Enbridge Southern Lights LP (ESL) and Enbridge Pipelines Inc. (EPI) required NEB approvals for several related project components:
- Transferring ownership of EPI's Line 13 to ESL;
- Removing Line 13 from southbound crude oil delivery service;
- Reversing the flow on Line 13 to carry diluent from the Canada/US border near Gretna, Manitoba, northbound to Edmonton, Alberta;
- Constructing a new 288 kilometer oil pipeline from Cromer, Manitoba, to the Canada/US border near Gretna, Manitoba, to transport light sour crude oil;
- Physical changes and alterations to EPI's Line 2; and appropriate tolls and tariffs for shippers to use the pipelines.
The NEB decided that the Southern Lights Project is an innovative and
cost-effective solution to transport diluent. The Applicants demonstrated
sufficient diluent shipping commitments to ensure the long term viability of
the pipeline, and have planned to preserve enough flexibility to allow other
shippers to transport diluent to Edmonton without long term contract
The NEB also found that the planned modifications to Line 2 and the
construction of the new light sour crude pipeline will offset the loss of
southbound capacity due to removal of Line 13 from crude oil transportation
The NEB found that the proposal to build new facilities on existing EPI
sites and right-of-way should minimize negative impacts on area landowners,
and also judged that mitigation planned for the construction phase will
minimize potential adverse effects, and required the development, in
consultation with affected parties, of urban construction plans. A workforce
housing plan and a worker code of conduct will also be required to reduce
local accommodation burdens during the construction phase. The NEB decided
that the Applicants' commitment to work with affected landowners and to
carefully track any complaints will further minimize negative impacts of
construction and operation.
The NEB will require ESL to conduct an emergency response exercise where
Line 13 crosses the South Saskatchewan River.
The NEB determined that ongoing discussions between the Applicants and
Aboriginal groups, and a Heritage Resource Discovery Contingency Plan, will
minimize potential impacts to traditional use sites, if any are encountered.
The NEB is an independent federal agency that regulates several parts of
Canada's energy industry. Its purpose is to promote safety and security,
environmental protection, and efficient energy infrastructure and markets in
the Canadian public interest, within the mandate set by Parliament in the
regulation of pipelines, energy development and trade.