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Atco eyes $700M to replace high-pressure gas pipelines in Calgary, Edmonton

Dave Cooper, Edmonton Journal, November 21, 2012

EDMONTON - Atco Pipelines is proposing to spend about $700 million to replace 260 kilometres of high-pressure natural gas pipelines in Edmonton and Calgary, with homeowners paying an extra $2 per on their monthly bills over five years to cover the work.

ATCO Urban Pipeline Replacement ProjectWhile the upgrades would have been done eventually, the catalyst for speedier action was an explosion in San Bruno, Calif., in 2010. A 1960s-era 30-inch steel natural gas pipeline owned by Pacific Gas & Electric exploded in flames just west of the San Francisco International Airport, killing eight residents. The loud roar and shaking led many to believe it was an earthquake, or that a jet had crashed.

“That event, coupled with some smaller ones in 2011, stimulated the whole industry to look at high-pressure pipelines in urban areas,” said Brendan Dolan, an Atco senior vice-president and manager of pipelines.

In Edmonton, that means building 50 kilometres of new pipelines in the Transportation and Utility Corridor (TUC) circling the city. Atco already has installed some segments in conjunction with work done on Anthony Henday Drive, so the proposed new lines will only be installed in the northeast and southwest areas of Edmonton. Those new lines will connect to the city’s gas distribution system and allow 135 kilometres of older high-pressure lines to be converted to low-pressure service. These lines run under streets and rights-of-way, close to many homes.

While Edmonton’s portion of the project will cost up to $250 million, more work is required in Calgary, where up to $450 million will be spent.

Atco’s Urban Pipeline Replacement Project started out as individual projects, until the Alberta Utilities Commission ruled that a piecemeal approach was wrong. Atco originally brought three separate projects forward for AUC approval, “and at some point there was a recognition that as well as three, there were nine others waiting in the wings,” said AUC spokesman Jim Law.

In July, the commission directed Atco to bring them together in one large project “and inform Albertans of the full scope of what it was proposing and come forward so the entire initiative can be reviewed all at once,” even though parts may not be built for several years, Law added.

“We want an open, transparent hearing process.”

Atco will be hosting several open houses around Edmonton, starting with one at the Century Hotel and Casino on Fort Road on Dec. 6 from 4 to 9 p.m.

Dolan said comments from the public will be included in Atco’s submission to the AUC. It expects formal hearings will be held this summer with a decision by the end of the year, allowing work to commence in 2014.

Atco says the replacement program is primarily aimed at reducing risks. High-pressure lines run at between 600 and 800 pounds per square inch compared with less than 100 PSI for low-pressure distribution lines.

In the event of a break, “you would have large volumes of gas coming out. The control centre would notice a loss of pressure and shut off the line remotely, but it would take a bit of time for the line pressure to be drawn down, as there is a large volume of gas in the line,” said Dolan. “You could have an explosion that ruptures the line even further. In California (San Bruno) there were 70 metres of pipe that came out of the ground,” he added.

In the San Bruno case the seam-welded pipeline started to unravel. The result of this “material defect” was a series of investigations and lawsuits and a total bill of about $1 billion.

Dolan said while the chances of such an incident are remote, if something were to happen there could be “drastic consequences” because so many people now live close to the pipelines.

Modern pipelines allow sophisticated inspection tools to be used for monitoring and Atco can install new fibre-optic cables that detect ground vibrations from heavy equipment, allowing Atco staff to race to a construction site to prevent an incident.

If the replacement project is not approved, Dolan said Atco will have to physically inspect all the high-pressure lines — which could mean cutting off gas service to install new pipes — and would involve digging up roads and rights-of-way.

“And while that would deal with the pipeline integrity issue, it does not address the risk of getting those pipelines away from people,” said Dolan.


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