TransCanada backs down, will submit pipeline impact study to Quebec

The Quebec government is promising to drop the legal action it took against TransCanada following the Calgary company's decision to submit an environmental impact study of its proposed EnergyEast pipeline.

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Quebec Environment Minister DavidHeurtelannounced on Friday the government had received a formal notice ofapplicationforthe pipeline project, whichwould carry 1.1 millionbarrels of oiladay from Alberta to New Brunswick.

TransCanadahadinsisted formonths thatsuch a measure wasunnecessary. Under Quebec's environmental laws, anoticeof application wouldforcethe company to undergo a more stringentreview process,including submittinganimpact study to the province.

TransCanada'srefusalangerednot only Quebec City, but environmental groups as well. They toohad sought aninjunction against the company.

ButTransCanadais nowreversingitsinitialposition.Heurtelindicated thatwith the notice of application,the pipelinewillreceive a more detailedassessment.

The next step in that process, hesaid, is for the company to complete its impact study, which the government expects by June 6.

"Within this newcontext,Quebec... is reconsidering itsapplication for a permanent injunction against TransCanada and is promising to withdraw it when the environmental impact studyimpactstudy is approved,"Heurtelsaidinastatement.

Decision by 2018

The Quebec government also agreed to provide TransCanada a definitive decision on whether it will support the pipeline by 2018.

It was having that detailedtimeline in place that convinced TransCanada executives to agree to take part in the stricter review process.

"You need to have a timetable and a minimum of certainty. How long is [the review process] going to take and when is it going to end?"saidLouis Bergeron,TransCanada'svice-president for New Brunswick and Quebec.

"That is what we were looking and that is what we have right now."

Quebec's decision to seek aninjunctionagainstTransCanadabrought swift rebuke from several Western politicians, includingSaskatchewanPremier Brad Wall.

Backers of the$15.7-billion pipeline sayit's necessary to improve the economic fortunes of the Western provinces, which have beenhit hard by theglobal drop in oil prices and are seeking a way to get oil onto ships for export.