On the first of May, 2024, the new pipeline from Edmonton to Burnaby was put into service with a planned capacity to transport 590,000 barrels a day of heavy oil, also known as diluted bitumen. It is now being well used, not to full capacity, but enough to increase the number of tankers loaded at the Westridge Marine Terminal in Burnaby from two per month to twenty per month, a 900% increase.
The old pipeline, Line 1 as it is now called, carried about 300,000 barrels oil a day of a variety of light oil, heavy oil and petroleum products. A secondary pipeline connected to it at Sumas takes primarily light oil to refineries in Washington State. In recent years this has grown from 50% to 70% of the oil flowing in Line 1.
So what has changed?
The amount of oil sent to the Westridge Marine Terminal has increased. This is most evident in the dramatic increase in the number of loaded tankers traversing Burrard Inlet, shown in the figure. These go primarily to California and China, but oil has also been sent to South Korea, Japan, Brunei and India.
Some things are not as obvious. There used to be a mix of Aframax and smaller Panamax tankers. Now they are essentially all the larger Aframax size of about 110,000 tonnes dead weight capacity. As well, most are “full,” whereas many were not in recent years. “Full” here does not mean the actual capacity of about 750,000 barrels, but means about 550,000 barrels, a limit imposed by travel restrictions through the Second Narrows in Burrard Inlet.
Tankers hang out for days, or even weeks, in the Pacific Ocean
There are now three new tanker berths at the Westridge Marine Terminal. On the basis of the information provided by Trans Mountain, it’s clear that only two were needed. It used to take two whole days to load an Aframax tanker, but with the three much larger pipes through Burnaby Mountain, an Aframax tanker should be loaded now in under one day. This is not happening, and all the tanker full loadings take two full days. Despite two requests to Trans Mountain, I have not received a useful answer to this conundrum.
A new feature is the use of ship-to-ship transfers to send oil across the Pacific Ocean in larger tankers. A very large crude carrier (VLCC) of about 300,000 tonnes dead weight. has about three times the capacity of an Aframax tanker. One of these, stationed at the PAL, a lightering area west and south of the USA-Mexico border, waits for Aframax tankers loaded at the Westridge terminal in Burnaby to arrive and transfer their loads to it. With three such loads the VLCC heads across the Pacific Ocean.
Several of these transfers occurred in the summer, but none in September. Perhaps the anticipated economy did not occur: the costs of the extra tanker travel and delays waiting for the Aframax tankers to arrive exceeding the savings of using a single larger tanker. One such delay occurred when the Sapporo Princess was held up for 5 days in Vancouver due, according to the Vancouver Port Authority, to “deficiencies that required attention from the Port State Control.”
When observing the tankers, I frequently get the impression that the process is inefficient. Tankers hang out for days, or even weeks, in the Pacific Ocean, apparently waiting for work. Even stranger is that a tanker that has discharged its oil in Washington State may travel all the way west through Juan de Fuca Strait and loiter in the Pacific Ocean before retracing its path to come to Vancouver, all the while reporting that it is coming to Vancouver.
In an earlier article (“Is There a “Business Case” for Trans Mountain? A Close Look at the Data,” Watershed Sentinel, December 2020), I showed a strong correlation from which one could deduce that tankers mainly went to Asia when the price of oil was unusually low. It is too early to say whether or not this is continuing. As the figure shows, shipments to Asia have been steady, but years of data are needed to see if such a correlation continues.
The National Energy Board approved almost every application from Kinder Morgan and Trans Mountain
Although we do not yet have a final price for construction of TMX, the current estimate is over $34 billion, and the provisional figure for the tolls the oil companies are paying to use the pipeline, a little over $11 per barrel, will recoup only about half of this.
Tom Gunton, currently Professor and Founding Director of the Resource and Environmental Planning Program at Simon Fraser University and of the International Institute for Sustainable Development, has now published a studyi that shows not only that the other half is a government subsidy, but that it is an inefficient subsidy, something that the government has vowed to eliminate.
Gunton has also suggested that this subsidy can be eliminated by introducing a “TMP cost-recovery levy” of $1 to $2 per barrel of oil applied to all Western Canadian oil shipments for ten years; this is something that can be justified on the basis of the Trans Mountain claim that Western Canadian oil shippers receive a benefit from the expanded pipeline. As well, the oil companies will barely notice it, as this is about the same amount as the daily oil price fluctuation. Gunton also describes a precedent for such a levy in Alberta in the 1980s when Trans Canada Pipelines faced serious financial difficulties.
The biggest picture
Building the new pipeline was a mistake. A very large number of people knew that when it was first proposed. The National Energy Board allowed people to make submissions, and divided them into ‘interveners’, ‘commenters’, or rejected. Its main criterion for acceptance was “directly affected.” All of those who wrote about the effect on climate were rejected; this included 26 climate scientists from across Canada. i
When governments and industry defy declarations of the United Nations, and hundreds of regular citizens try to protect the land, what should the response be? At present it is to put these protectors in jail. This is wrong. A Citizens’ Assembly should be set up to study the question and make recommendations that are binding. The Assembly should be composed of perhaps 150 randomly selected citizens in which anyone with a vested interest, such as politicians and business tycoons, would be excluded.
The National Energy Board apparently did not realize that more fossil fuel infrastructure would contribute to more climate change which would directly affect everybody. As time went on it became increasingly apparent that the National Energy Board approved almost every application from Kinder Morgan and Trans Mountain, and was a servant of the oil and gas industry.
One Board member had been convicted of insider trading; another was appointed despite his having a serious conflict of interestii; some Board members met privately with a lobbyist for a different pipeline application. All these were contrary to the rules, and overseen by the Board Chair. People in the Canadian government knew, or should have known, all this. Eventually the National Energy Board was disbanded and replaced by the Canada Energy Regulator, with a new set of people in charge, but continuing the support of the oil and gas companies as a captured regulator. We are sleep-walking into worse and more frequent catastrophes. Our governments know it but their only responses have been tinkering at the edges.
Notes
1. https://www.iisd.org/publications/report/fossil-fuel-subsidies-trans-mountain-pipeline
2. 26 climate scientists denied participation, National Post, April 10, 2014.
3. Submission to the National Energy Board Modernization Expert Panel by David J. Huntley, Professor Emeritus, Physics Department, Simon Fraser University. February 8, 2017. I am unable to find this on the web, though the recommendations of the panel and summaries of the submissions are available.
David Huntley is Professor Emeritus in the Department of Physics at Simon Fraser University.
