The Westerner for November 1, 2011

50/50  Jim Johnston and Justice Elizabeth Johnson matched cards and share $141; congratulations!

Gift Card Reminder:   We all need to buy groceries.  Now we have an opportunity to do that in a way that will generate funds for our Rotary Club.  A very simple way to do it is to send Brian an e-mail requesting $xxx worth of Safeway, Sobeys/IGA or Saveon cards, and then bring a cheque in that amount to the next meeting.  Brian will hand you an envelope with your requested cards and you will hand him your cheque.  This won't cost you one extra penny, but we can make a profit in the range of 6% to 8% because we purchase the cards in a large volume.  This fund raiser requires less effort on behalf of Club members than any other, so please give it your support.

Guest Speaker:  Duane introduced John Carruthers, President of Enbridge Northern Gateway which plans to build a dual pipeline to the west coast.  John has led the project up to the current status of the regulatory application process.  John has much prior pipeline experience including time with Trans Canada Pipeline.

This is an important project for Canada - allowing the search for alternate customers to the USA for Canada's largest export product - crude oil.  Enbridge has 60 years experience with large diameter pipe.  All pipelines now go to the USA which had been the world's largest market.  We now need alternate markets because of the slow down in the USA economy and the fact that cars are now more fuel efficient.  In addition, the USA is putting trade restrictions on Canadian oil.

Alternate markets can generate a higher price for our products, possibly $18 billion per year.  The oil industry could benefit by the additional income of $28 billion over 10 years with the rest going to taxes and other tariffs.   Potential customers include Japan, South Korea, and China.  We would be closer than Saudi Arabia and Venezula. 

Dual pipelines include a line from Edmonton to the west coast which could deliver 525,000 barrels a day of heavy crude infused with condensate (36" in diameter).  The second line could bring condensate from Australia or Saudi Arabia to Edmonton, 393,000 barrels per day (20" in diameter).  The good ports are either Kitimat or Prince Rupert.   Vancouver is limited by ships having to go under the Lions Gate Bridge.  A key question is safety - the most economical and safest way to move oil is by pipeline.  

Enbridge suffered a spike in the pipeline it runs in Michigan which has damaged Enbridge's credibility,  but Enbridge is prepared to engineer this project to reduce the possibility of such events.  Route selection is key to reducing potential problems.  With Gateway, they would drill through 2 mountains to maintain the optimum roulte - each about 6-1/2 kilometers by 5 meters diameter.  The pipe - all welds would be tested; all pipe is coated to prevent erosion and other problems; valves would be installed near ro sensitive areas.  Equipment would be permanently stationed along the pipeline for rapid response if a problem arose.  There would be constant monitoring to prevent these problems. 

Can there be another Exxon Valdes incident?  11,000 ships have travelled to Alaska since with no problem.  Don't expect problems in Canadian waters.  Enbridge would ensure that all tankers are double hulled ships.  In a collision, the outside hull absorbs the impact.  Also, all ships would employ B C pilots.  1500 ships have gone to Kitimat recently with no problems.  Enbridge would improve navigational aids and restrict ship movement in bad weather and other adverse conditions.  Ships would be tethered to tugs to reduce a chance of an incident.  Monitoring would include whale and other animal migration - reduce collisions or habitat damage.

Question of support from aboriginal communities - 50 First Nation Communities will be impacted.  Enbridge will go out of its way to reduce environmental problems and will contribute to youth education and provide jobs.  10% equity in the project will be given to these communities and Enbridge will fund the purchase of that equity, on the First Nations' behalf, out of the project's profits.  Up to $1 billion will accrue to these communities through procurement of products and provision of jobs.  More aboriginal communities are providing support.  There is less support west of Prince George and Enbridge is working on bringing them on side.

Benefits include $270 billion in GDP over 30 years and $81 billion in tax revenues.

The Process - The application was in May, 2010.  Intervenor questions were received and answered September, 2010 (2000 questions).  Second round of questions this weekend.  January, 2012, the joint review panel will travel along the right of way to hear local concerns - 4,000 people to speak.  If not speaking, people have till March, 2012, to issue Letters of Support.  Formal hearings in June, 2012.  There are net benefits to Canada for both Keystone and Gateway projects to go forward - there is enough supply of crude to support both.

John was thanked by Perry.  A very comprehensive report to our club and guests.