Tank farm causes concern

By Dan Hilborn
Published Aug. 26, 2006


A proposal that could ultimately double the capacity of the Kinder Morgan Canada tank farm on Burnaby Mountain has prompted city council to look at its regulations on the large-scale storage of oil and gas in the city.

Coun. Nick Volkow said he is concerned about the proposal to build one new 35,000-square-metre (220,000-barrel) gas storage tank at the Burnaby Mountain facility by the year 2009 and possibly add another five more tanks in the ensuing years.

The Burnaby Mountain tank farm plan is only one part of a billion-dollar plan to increase Kinder Morgan's pipeline and storage capacity by 100,000 barrels per day.

The project, which is in the early discussion stage, will also add another 495 kilometres of pipeline connecting the oilfields of Alberta and northeast B.C. to the Lower Mainland, build five new and upgrade six existing pump stations and increase Kinder Morgan Canada's storage capacity at three different tank farms, including Burnaby Mountain.

The plan, dubbed the TMX-2 project, is detailed in a 10-page report presented to city council on Monday night.

Volkow said he is more concerned about the proposal coming from Kinder Morgan than he would have been had the work been proposed by the tank farm's previous owners, Terasen and Trans Mountain Pipeline Ltd.

"Kinder Morgan has a bit of a sorry record when it comes to operating in their home base of Texas, so I'm prepared to give this application a lot more scrutiny than I would have under the previous operators," Volkow said. "They're not the best operators on the planet when it comes to operating pipelines."

The tank farm, which has been located on Burnaby Mountain since 1953, was purchased by Kinder Morgan last year as part of a $6.9 billion acquisition of Terasen Gas Inc. Prior to that, the facility was operated by Trans Mountain Pipeline Ltd.

Team Burnaby council members Lee Rankin and Garth Evans questioned whether city council had the ability to limit the number of storage tanks at the 77-hectare (189-acre) Burnaby Mountain facility, which currently has 13 storage tanks with a total capacity of 270,000 square metres (1.7 million barrels).

Jack Belhouse, the director of of the city's building and planning department, said the city zoning bylaws can only regulate the technical requirements of the tank farm, and the project can go ahead as long as it meets "fire safety and other regulatory bylaws."

"So we can't stop them, thank you," Evans replied.

And Coun. Pietro Calendino said he is "totally against" the plan because the neighbourhood around the tank farm has changed considerably in the past half a century.

Contacted on Tuesday morning, Philippe Reicher, director of external relations for Kinder Morgan Canada, said the company is proud of its track record and will comply with all the necessary regulations and other legislative requirements should the project go ahead.

"We've been neighbours for 50 years in Burnaby so if you look at our history, our operational history, we have an excellent record when it comes to environmental protection," Reicher said. "If we were to expand, we'd be expanding using the same philosophy and guidelines.

"The fact that we changed our name to Kinder Morgan does not mean we have changed at all the way we operate our pipeline systems," Reicher said, adding that the expansion plans still hinge on the outcome of a ongoing commercial discussions with large-scale petroleum producers such as Chevron, PetroCanada and Shell. "If we don't have the deal completed, the expansion won't take place, and at this point we do not yet have the deal."

Reicher also said that Burnaby Mountain storage facility can easily handle the proposed increase in capacity. "If you look at other tank farms in other jurisdictions, you'd realize the density of tanks is quite a bit higher than what we have in Burnaby. ... There is plenty enough room to accommodate the additional tankage."

If pipeline and tank farm expansion plan does go ahead, the project will be regulated by the National Energy Board, Reicher said.