TransCanada Submits Energy East to Added Scrutiny in Quebec

  • Company makes more filings for province's environmental review
  • Oil pipeline crossing six provinces seen costing $12.4 billion

TransCanada Corp. has agreed to submit its C$15.7 billion ($12.4 billion) Energy East pipeline to more environmental scrutiny in Quebec, ending weeks of uncertainty after the provincial government filed a court injunction against the project.

TransCanada on Friday filed a project application notification as part of the environmental assessment process in Quebec, one of six provinces its proposed oil pipeline would cross. The Calgary-based company also plans to submit a detailed environmental impact study, Tim Duboyce, a spokesman, said in a phone interview.

It’s the latest twist for TransCanada as it seeks to build North America’s largest oil pipeline, which would transport as much as 1.1 million barrels a day from Western Canada to the nation’s Atlantic Coast. Developers of Canada’s oil sands are short of pipeline capacity to export rising volumes of the crude as the industry has been stymied in its efforts to build new projects by environmental opposition, including in Quebec.

“Today it’s a good news story really, which is we came to an agreement,” Duboyce said.

Additional Scrutiny

TransCanada and provincial officials had disagreed about whether the pipeline proposal was required to undergo the additional scrutiny usually reserved for developments within the province’s boundaries. The federal National Energy Board regulator has jurisdiction to review inter-provincial projects and make a recommendation to cabinet ministers.

“The Quebec government wanted to make sure that this project would be submitted to what we call public hearings on the environment and natural resources,” Pierre Arcand, Quebec’s minister of energy and natural resources, said Friday in an interview at Bloomberg’s New York office. The province hasn’t taken a stance yet on the project, he said. “Cool heads have to prevail. We’ll have to look at facts, and how it is going to be dealt with.”

Energy East has faced delays and rising costs as TransCanada has made changes to the project’s route and design to appease concerns, including the elimination of a proposed marine export terminal in Quebec. The company plans to refile its application to the National Energy Board next month after repackaging the documents with the changes so they’re easier for the regulator to understand, Duboyce said.

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