Regulatory Law Chambers logo

Trans Mountain Pipeline ULC Trans Mountain Expansion Project Certificate of Public Convenience and Necessity OC-065 Application for Variance and Condition Relief under the Certificate Mountain 3 Horizontal Directional Drill, CER Reasons for Decision (C28265-3; A8W1D0)

Link to Decision Summarized

Gas – Facilities

Application

Trans Mountain Pipeline ULC (“Trans Mountain”), pursuant to s 190 of the Canadian Energy Regulator Act , submitted an application to vary (“Application”) Schedule A of Certificate of Public Convenience and Necessity OC-065 (the “Certificate”). The Application sought to vary the diameter, wall thickness and coating of pipe for the Mountain 3 horizontal directional drilling (“HDD”) crossing for the Trans Mountain Expansion Project (“TMEP”), and associated facilities.

Trans Mountain also applied, pursuant to Condition 1 of the Certificate, for relief from the requirement to adhere to the Quality Management Plan (“QMP”) filed under Condition 9 of the Certificate with respect to the pipe and other related materials to be used for the Mountain 3 HDD crossing.

Decision

The CER granted the Application with reasons to follow, and this decision contains the CER’s reasons for the approval.

Pertinent Issues

Trans Mountain Submissions

Trans Mountain stated that during construction of the Mountain 3 HDD crossing, it encountered several complex challenges, including hard rock conditions and the presence of multiple fractured areas within the bedrock. These complications were expected to get materially worse if Trans Mountain continued with the current plan of construction. The challenges led to premature and accelerated tooling wear and high rates of water ingress.

Trans Mountain further submitted that if it proceeded with its current plan to install a nominal pipe size (“NPS”) 36 pipe, there was a significant risk that the borehole would become compromised or the HDD will fail altogether. This would lead to significant construction delays and profit losses.

To alleviate the issue, Trans Mountain considered several alternatives. The preferred option would permit Trans Mountain to install NPS 30 pipe within the already completed 42-inch ream pass for the Mountain 3 HDD crossing, eliminating the need to continue with the previously planned 48-inch ream pass and avoiding the associated risks.

Trans Mountain submitted that this was the most prudent option in the circumstances. This option could be executed quickly and safely, with minimal technical risk and without impact to the capacity of the expanded system.

Trans Mountain committed to installing trap facilities capable of providing full in-line inspection of the pipeline from Hope Station to Burnaby Terminal.

CER Findings

The CER noted that, with respect to economics, environmental and socio-economic effects, rights and interests of Indigenous Peoples, and engagement, there were no material changes between the information contained in the previous variance application and the Application. As a result, the CER adopted the analysis and findings related to these matters in the reasons for decision issued for the previous variance.

The CER acknowledged the difficulties with rock hardness and water ingress relating to Mountain 3 HDD but found that Trans Mountain has not encountered any technical challenges that were not identified by the feasibility study and geotechnical assessments carried out for the Mountain 3 HDD.

The CER recognized the risks associated with completing the 48-inch ream pass of the Mountain 3 HDD to install the 36-inch pipeline and the choice to make a risk-based decision to stop the 48-inch ream and install the 30-inch pipeline to avoid those risks.

The CER accepted that the installation of NPS 30 pipe at the Mountain 3 HDD would not have a significant effect on the design and operation of the rest of the TMEP and that the maximum operating pressure and nominal capacity of the pipeline will not be affected. The CER, however, did not agree with portions of Trans Mountain’s analysis related to pipe stresses in the Mountain 3 HDD section and found that it may contain errors related to unsupported span lengths, boundary conditions, and reaction loadings on the spans. The CER was of the view that, in light of the errors in that analysis, it was prudent for Trans Mountain to review the analysis of pipe stresses, particularly the accuracy of unsupported lengths, boundary conditions, reaction loads on the span and acceptance criteria, and inform the CER of any resulting clarifications or corrections.

The CER noted that Trans Mountain’s QMP was developed specifically for the TMEP as a pre-construction requirement and that it was assessed and accepted by the National Energy Board (“NEB”) under Condition 9. The CER found that, although Trans Mountain provided additional documentation in the Application, Trans Mountain still did not demonstrate that it fully conformed to its QMP processes, specifically in the areas of vendor quality inspection activities and oversight. For the Application, the CER accepted Trans Mountain’s assertions that the Engineer of Record carried out a review and approval of the documents, while the process of signing all records by Trans Mountain was carried out later or is still ongoing. To ensure adherence to material quality standards, the CER imposed Condition 3 (pipe material testing). Condition 3 requires Trans Mountain to provide a letter signed by its Accountable Officer confirming that chemical and mechanical testing of a sufficient sample size of the procured NPS 30 pipe has been conducted and that the pipe and related components conform to TMEP pipe and component specifications.

Consequently, the CER granted Trans Mountain relief from Certificate Condition 9 for materials procured and installed to construct the variance.

The CER was satisfied that the pig trap facilities proposed by Trans Mountain in the Application will provide full in-line inspection capability for the section of pipeline between Hope Station and Burnaby Terminal. The CER imposed Condition 2 (in-line inspection) requiring Trans Mountain to confirm the mechanical completion of the trap facilities at the north and south ends of the Mountain 3 HDD segment before the completion of Line 2 line fill. Condition 2 also required Trans Mountain to file for leave to open those pig trap facilities within three weeks of confirming the mechanical completion.

Related Posts

Yatar v. TD Insurance Meloche Monnex, 2024 SCC 8

Yatar v. TD Insurance Meloche Monnex, 2024 SCC 8

Link to Decision Summarized Download Summary in PDF Administrative Law – Judicial Review v. Statutory Appeal Application Ummugulsum Yatar (“Ms. Yatar”) contested the denial of her insurance...