Updated: January 29 2018, 10:05 MT
The National Energy Board has approved plans to repair an Enbridge pipeline vital to oil production in Norman Wells.
The company’s Line 21 pipeline has been closed since November 2016 over concerns about slope stability where the pipeline crosses the Mackenzie River, about nine kilometres east of Fort Simpson.
Line 21 is the only way to get oil out of Norman Wells. Its closure forced Imperial Oil to suspend local operations, where 60 people were directly employed and around 50 others held contract work.
Enbridge hopes to have the pipeline up and running again by late 2018.
The necessary repairs involve replacing a 2.5-km segment of pipe under the river. On Wednesday, after a 10-month review process, the National Energy Board said it was “in the public interest” for the $53 million project to go ahead.
“In approving Enbridge’s application, the board has also imposed conditions that will enhance current and ongoing pipeline integrity, safety and environmental protection measures to which Line 21 is already subject,” read a document outlining the board’s rationale.
“The board’s decision enables Enbridge to react to externally-driven threats to the integrity of Line 21 while at the same time implementing the project in a safe and environmentally sensitive manner. It is now up to Enbridge to fulfill its commitments and satisfy the board’s requirements.”
In making its decision, the board also approved Enbridge’s plan to leave the old, replaced section of pipe under the Mackenzie River itself. “The section of pipe that is to be left behind will be cleaned, filled with grout and capped, in accordance with NEB regulations and CSA standards,” the board said.
Public hearings to review the proposals were held in Fort Simpson in October last year.
The board imposed 26 conditions on the project, including a demand that local Indigenous peoples be engaged with by Enbridge, their knowledge be used, and they be invited to participate in monitoring of the ongoing work.
A separate regulatory approval process overseen by the Mackenzie Valley Land and Water Board, for the project to be granted a land use permit and water licence, is ongoing.
Enbridge believes it can have the pipeline ready to resume operations by the end of September this year. A draft of a separate Enbridge application – to reactive the pipeline, once it is repaired – was circulated to various northern groups last week, in readiness.
Imperial Oil would be free to resume operations once the pipeline is reactivated, though those operations have not been at their healthiest. At the time the pipeline was taken offline in 2016, Imperial Oil had spent several months trying to sell its share of the Norman Wells oil field, which is one-third federally owned.
Despite Imperial Oil’s search for a buyer, the field appears to be profitable. Federal figures suggest Canada received $75 million from its share of the field in 2014.
The Canadian Press reports that the Norman Wells field produced 11,000 barrels of oil per day in 2015, its last full year of operation. The pipeline has a capacity of 50,000 barrels per day. Imperial Oil has previously suggested the oil field has five to 10 years of operational life remaining.