High Shipping Costs Are Here to Stay, Says Bloomberg
By Henry Ren (Bloomberg) Stubbornly high shipping expenses for businesses are getting sealed into contracts for the next 12 months, forcing companies to pass the extra costs on to consumers....
By Robert Tuttle
(Bloomberg) — Kinder Morgan Inc. will have to address the fate of one more group before completing its Trans Mountain pipeline expansion: killer whales.
Less than a month after Canadian Prime Minister Justin Trudeau announced the approval of a plan to almost triple the capacity of Canada’s only oil pipeline to the Pacific coast, the environmental law group Ecojustice filed a federal court case on behalf of Living Oceans Society and Raincoast Conservation Foundation seeking to block the decision. The government failed to consider the fate of about 80 killer whales that live in the main shipping lane for the crude tankers that will carry Alberta’s oil, Dyna Tuytel, an Ecojustice lawyer, said in a phone interview.
“The ones that we are concerned about are the Southern Resident killer whales,” she said. The pipeline adds “seven times more tankers, which contribute to noise and interferes with hunting and communication.”
Trudeau’s Nov. 29 announcement that the C$6.8 billion expansion of the line to 890,000 barrels a day from 300,000 can move ahead was welcomed by Alberta’s oil producers and protested by environmental groups. Kinder Morgan Canada President Ian Anderson said in a telephone press conference on Nov. 30 that the company was preparing for legal challenges.
Tuytel said the Canadian government adopted the recommendation of the National Energy Board, which lacked measures to protect the whales. The extra tankers would also threaten local salmon, the whales’ main food source, and increase the risk of an oil spill, she said.
The Southern Resident killer whales are probably the most studied whale population in the world, Tuytel said. Scientists have given them nicknames and the group’s members don’t mate with other killer whales that pass through their waters. The pipeline expansion could push the population toward extinction at a time when numbers were recovering, Karen Wristen, executive director of the Living Oceans Society, said in a phone interview Tuesday.
The pipeline expansion, which still requires some local permits, could start by September, according to the company. While the pipeline will increase tanker traffic almost six times to 350 per year, that will represent less than 7 percent of large commercial vessels moving in the area, Ali Hounsell, Trans Mountain Expansion Project spokeswoman, said in an e-mail.
“We will be responding formally in the coming weeks,” she said. The government approval “follows many years of engagement and the presentation of the very best scientific, technical and economic information.”
Ecojustice hopes for a hearing on its petition by the end of February, Tuytel said. A final decision could take a year or more.
“Our case doesn’t stop them from beginning construction,” she said.
© 2016 Bloomberg L.P
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