Overview of the Northern Gateway Pipelines Project March 2013

Transcription

1 Overview of the Northern Gateway Pipelines Project March 2013

2 New Market Access Required to Earn Full Value Petroleum Landscape: Global Demand Growth Going Up but USA Demand Going Down USA Supply Going Up Canada presently captive to USA Market and Pricing (99% of exports) 2

3 Market Diversification - Trends in Demand Demand: *Through 2030 China and India will experience average annual growth > 3.5% contrasted with the declining demand for oil in the United States Volume (million m 3 /d) Volume (million bpd) United States China & India *International Energy Agency

4 Price Signals For Export Infrastructure Development Asia $109 $2 $88 $75 Alberta Light WCS $13 $89 Bakken Light $113 Brent $96 WTI Light Crude Heavy Crude $3 $113 LLS Natural Gas $102 Maya Note: Pricing reflects 2012 year to date averages 4

5 MERCATOR MAP FROM KARO 5

6 The Northern Gateway Project Key Elements Major Scope Items: 1,177 km crude oil and condensate pipelines Marine terminal $6.4 billion project Targeting 2018 in-service Pipe Design: 525,000 bpd crude oil 193,000 bpd condensate Kitimat Terminal: 5 million barrels of storage 2 berths VLCC ready 6

7 Northern Gateway - Benefits for Canada Canada will be the largest Project beneficiary British Columbia and Alberta are also significant beneficiaries

8 Benefits for British Columbia & Alberta BC 4100 person-years Direct On-Site Employment Total $ 830 Million AB 1400 person-years Direct On-Site Employment Total $232 Million

9 Why Is The Project Controversial? Ideological opposition to oil sands First oil pipeline to the northern BC coast (lack of local familiarity) Unsettled BC land claims and concerns regarding impact on Aboriginal rights and traditional way of life River Crossings & Marine Route Crossing several significant salmon rivers Legacy of Exxon Valdez Legacy of Queen of the North Imperfect Pipeline Industry track record 8

10 Enbridge Safety & Integrity Objective is to be top quartile (goal = best) Integrity management Leak detection Incident response Worker occupational safety Public safety / environmental protection Recent pipeline integrity activity 2,500 integrity digs 138 inline inspection tool runs $2.9B integrity investment since

11 Evolution in Pipeline Technology & Safety Route and watercourse crossing selection Stringent steel chemistry & strength testing Fusion bond epoxy coated pipe used & inspected Every weld will be inspected during construction Cathodic protection prevents corrosion during operation Control center Enhanced protection: thicker steel, shut-off valves Pipe hydrostatically tested 24/7 monitoring from control center Routine aerial reconnaissance of pipeline ROW Increased monitoring with in-line inspection tools 11

12 Existing Tanker Routes & Tanker Exclusion Zone 12 12

13 Marine Measures: exceed regulation & current practice Regulatory Requirements: Double hulled ships / multi compartment BC pilots (plus redundant nav-aid systems) Emergency preparedness and response planning Enhancements to Safety: Tanker route simulation Improved navigational aids, new radar Vetting of ships and crew Weather monitoring criteria for ship transit Reduced vessel speeds in marine channels Tug escort operations (tethered towing) Closed loading and containment booms 13

14 Broad Aboriginal & Community Consultation 14

15 Portfolio of Aboriginal Benefits (short, med & long term) Equity ownership 10% (incl. MNBC & MNA) Structured to access credit Procurement $300 Million targeted (P/L & Stations) Based on Enbridge experience Depends on capacity 2011 Aboriginal Business Summit Qualified and competitive Employment & Training 15% construction target Work with prime contractors & Unions Tax income on Reserve land base Marine & Tunnel Benefits (~ $200 Million+ / -) Aggregate value ~ $1 Billion 15

16 Rigorous and Open Public Review Process Public regulatory review (Joint Review Panel) led by: Economic & technical feasibility, socio-economic & environmental protection Q: Is this project in the overall interest of Canadians? Conditions? Canadian Environmental Assessment Agency (CEAA) high-quality environmental assessments in support of sustainable development Q: Can this project be undertaken in an environmentally sound manner? Conditions? Additional agencies, including: Transport Canada Department of Fisheries and Oceans Indian and Northern Affairs Natural Resources 17

17 Regulatory Timeline JRP is a quasi-judicial, independent tribunal Regulatory Application Filed (May 2010) Information Requests (Aug 25 to Nov, 2011) Community Hearings (started Jan 10, 2012) Final Hearings (started Sept 2012) Regulatory Decision / Detailed Engineering Construction JRP community review of Issues and required additional information Deadline to Register for Oral Stmts Oct 6, 2011 Deadline for Letters of Comment Aug 31, 2012 Community Hearings cont NGP In-Service Date gatewaypanel.review-examen.gc.ca The above timeline is illustrative and subject to change 18

18 Path Forward Our View Public: Increasing appetite for fact and evidence-based discussion Enbridge & Industry: Increasing focus on earning social license JRP recommendation Dec Conditional approval of Project i.e. with conditions promoting reconciliation (~ mid 2014) As JRP hearings wrap up, engagement focus will increasingly turn to benefits Scope for industry collaboration e.g. in training-to -employment initiatives 18

19 Thank You Questions?

20 Auxiliary Slides If Time Allows

21 Exxon Valdez Then and Now - Prevention Prevention Valdez, AK (1989) Valdez, AK (2009) Northern Gateway Tanker escort tugs Ocean rescue tug Double hull tankers Vessel monitoring Emergency preparedness planning Regulatory oversight Health, safety and environment programs 21

22 Exxon Valdez Then and Now - Response Response Valdez, AK (1989) Valdez, AK (2009) Northern Gateway Multiple equipment locations Equipment readily available Oil recovery and storage capacity Trained responders Protection of sensitive areas Managed response Communications infrastructure Practice drills 22