Canadian regulator approves oil pipeline to the Pacific Coast with 209 conditions

TORONTO – A panel reviewing a proposed pipeline to the Pacific Coast that would allow Canada's oil to be shipped to Asia recommended Thursday the Canadian government approve the project.

The three-person review panel recommended approval with 209 conditions.

Natural Resource Minister Joe Oliver said the government will thoroughly review it and consult with affected aboriginal groups before making a decision on Enbridge's contentious pipeline. Prime Minister Stephen Harper's Conservative government has staunchly supported the pipeline after the U.S. delayed a decision on TransCanada's Keystone XL pipeline that would take oil from Alberta to the U.S. Gulf Coast.

But there is fierce environmental and aboriginal opposition and court challenges are expected.

Opponents fear pipeline leaks and a potential Exxon Valdez-like disaster on the pristine Pacific coast. About 220 oil tankers a year would visit the Pacific coast town of Kitamat. The pipeline would transport 525,000 barrels of oil a day.

The Northern Gateway pipeline would be laid from Alberta's oil sands to the Pacific to deliver oil to Asia, mainly energy-hungry China.

Harper has said Canada's national interest makes the $5.5 billion pipeline essential. He was "profoundly disappointed" that U.S. President Barack Obama has delayed a final decision on the Texas Keystone XL option, but also spoke of the need to diversify Canada's oil industry. Ninety-seven percent of Canadian oil exports now go to the U.S.

The Keystone XL pipeline and the Northern Gateway project are critical to Canada, which needs infrastructure in place to export its growing oil sands production. The northern Alberta region has the world's third largest oil reserves, with 170 billion barrels of proven reserves.

The Joint Review Panel of energy and environmental officials spent two years canvassing opinion along the 1,177-kilometer (731-mile) route of the Northern Gateway pipeline to be built by Enbridge.

The fear of oil spills is especially acute in this pristine corner of northwest British Columbia, with its snowcapped mountains and deep ocean inlets. Canadians living here still remember the Exxon Valdez oil spill of 1989.

Environmentalists and First Nations — a Canadian synonym for native tribes — could delay approval all the way to the Supreme Court, and First Nations still hold title to some of the land the pipeline would cross. That means the government will have to move with extreme sensitivity.

Critics dislike the whole concept of tapping and transporting the oil sands, saying it requires huge amounts of energy and water, increases greenhouse gas emissions and threatens rivers and forests. Some projects are massive open-pit mines, and the process of separating oil from sand can generate lake-sized pools of toxic sludge.

Meanwhile, China's growing economy is hungry for Canadian oil. Chinese state-owned companies have invested billions in Canadian energy in the past few years.