Area could play key role in Energy East
June 25, 2013, 3:04 am
Kevin Weedmark
The Moosomin area could play a key role in TransCanada's Energy East initiative, which aims to transport western Canadian crude to eastern Canadian refineries.
TransCanada plans to build four terminals across the country for Energy East, including one in the local area, which would include a tank farm. The Moosomin Compressor Station would connect a Bakken oilfield feeder pipeline to the TransCanada main line.
TransCanada's main line transports primarily natural gas from Western Canada to eastern markets, but one of the pipelines has been converted to transport oil as part of the Keystone Pipeline, and as part of the Energy East proposal, a second pipe would be converted to transport oil.
The existing mainline would be used across Saskatchewan, Manitoba, and Ontario, and a new pipeline would be built to carry the oil to Montreal, Quebec City, and possibly as far as the Irving Oil refinery in St. John, New Brunswick.
The idea is for western Canadian crude to replace imported oil as the feedstock for eastern refineries.
The Moosomin compressor station-located in the RM of Moosomin northeast of Moosomin, directly north of Fleming and south of Welwyn-would be the on-ramp for oil from the Bakken formation to the TransCanada system.
The proposal to get Bakken oil into the system would involve building a new pipeline from Cromer, Manitoba-just southeast of Kola-to the Moosomin compressor station, and a tank farm to store oil.
The 4,400 km Energy East pipeline system-including 1,400 km of new pipeline-would carry between 500,000 and 850,000 barrels of oil a day from Alberta and Saskatchewan to eastern refineries.
On Monday, TransCanada wrapped up its "open season" process, in which oil shippers could bid for transportation capacity on the Energy East system. Between April 15 and June 17, shippers could bid on capacity in the line.
"We went out to the market and opened it up for expressions of interest and bids, for our customers to commit to using the pipeline," explained Grady Semmans of TransCanada.
"We'll be taking some time in the next few weeks to go through the bids to determine the scope of the project-what the demand is . . . to go to Montréal, Quebec City, and east."
While the formal application for the project hasn't gone to the federal government yet, TransCanada has started communicating with landowners about its plans.
"All of this is in the early development stage, but we have started going out along the route of the pipeline to share information with landowners, gathering their feedback, and we're starting to go out and discuss the potential route, especially the feeder line, because we will be dealing with new landowners.
"In the next few weeks, we will finalize the scope of the project, and we would make initial application to the National Energy Board by the end of 2013.
"We would hope it would be approved by the end of 2015, and we would be in construction from 2016 to 2018."
Past pipeline construction projects have had a big impact on the local economy.
"Generally speaking, pipeline construction is very labor intensive-it requires a lot of laborers," said Semmans.
"We're working on the south end of the XL pipeline right now. We're employing about 4,000 people on that job, and seeing lots of spinoffs."
There is potential for some new permanent jobs at the Moosomin-area terminal/compressor station once Energy East is online.
"It's not something we have detailed estimates on at this point," said Semmans. "We're not able to discuss the scope of the project yet . . . Energy East as a whole will have a lot of full-time people dedicated to it. Pipelines once they're operating aren't labor intensive, but there could be potential for more (positions) at Moosomin as there could be terminal facilities and storage tanks."
Semmans said the process of regulator approval for the Energy East project is similar to that for building an entirely new pipeline.
"The regulatory process is similar . . . but it is a different project, with 3,000 km of existing pipeline. We have lots of longstanding relationships with landowners already."
While some provincial regulation will apply to the project, most of the regulatory process will be with the National Energy Board.
"There are a whole host of different regulatory applications and permits that need to be attained along the way, but the overall application will be with the National Energy Board," said Semmans.
Part of the impetus for Energy East, besides the demand from western oil producers to get their products to eastern markets where prices are higher, is the fact that TransCanada has unused capacity in its main line.
"The natural gas main line has a lot of excess capacity at this point, because of changes in natural gas production," said Semmans. "It was designed to move huge volumes of natural gas from Alberta out to the east 50 or 60 years ago."
Now that fracking technology has led to more natural gas production in the eastern half of North America, there simply isn't the need to transport as much natural gas to eastern markets.
This won't be the first TransCanada line converted to carry oil instead of natural gas.
"We did convert one of the pipes in the mainline to oil service from Alberta to Winnipeg for the Keystone Pipeline, so it's something we have done before," said Semmans.
The Keystone Pipeline carries oil from Western Canada to Winnipeg and then south to the United States.
Moosomin mayor Larry Tomlinson said he is happy that TransCanada is looking at expanding in the Moosomin area, and said the potential development sets a challenge for the town to develop the infrastructure to accommodate more growth.
"This is very important for Moosomin," he said Wednesday. "This is exciting news. If we're going to keep growing, this is the sort of thing that we need.
"We've got to be looking at infrastructure and trying to expand landwise and everything else-everything that goes with it.
"In this budget we had tried to put some funds away in the hopes of getting some land. We'll see how much money we can put away for that.
