With nearly two million miles of built pipelines in the U.S., the normally mundane world of oil and gas pipelines stays out of sight, out of mind and out the headlines.
This year, however, things changed.
Already facing criticism over their role in climate change – largely guilt through association with their customers -- oil and gas transport companies found their practices thrust into the spotlight after a series of incidents plaguing the energy sector in 2010 culminated in the recent natural gas explosion in San Bruno, Calif. If the link between pipelines and climate change is a difficult concept for stakeholders to grasp, concerns over personal health and safety are not.
Adding to the woes of pipeline companies is a rising level of stakeholder resistance to infrastructure projects in general, ranging from offshore wind farms to high-speed rail. In addition, where once government support for infrastructure projects was practically a given, that support can be more difficult to secure where financial or political costs are perceived to be too high.
As a result, new pipeline projects face hurdles and a higher level of scrutiny than ever before. Project managers will have to go beyond the call of duty if they are to overcome stakeholder resistance and avoid the risk of costly delays or the potential of derailment. As two of my colleagues wrote earlier this year, stakeholder collaboration can be a key to avoiding these pitfalls and building required support.
One of the most high-profile pipeline projects is TransCanada's Keystone Gulf Coast Expansion Project, known as the Keystone XL, a 1,600-mile pipeline scheduled for completion in 2013. It will bring semi-refined oil sands crude from Alberta to refineries on the Texas coast.
Another is El Paso's Ruby Pipeline, a nearly 700-mile natural gas pipeline stretching from Wyoming to Oregon that is slated for 2011 completion and will serve Anadarko, BP, Marathon and Shell.
Both projects have faced their share of controversy. The Natural Resources Defense Council (NRDC) challenged the U.S. State Department over the "validity" of Keystone's environmental impact statement.
Similarly, the Sierra Club and other environmental groups recently filed a challenge to the Ruby Pipeline alleging the federal Bureau of Land Management (BLM), the Fish and Wildlife Service and the U.S. Army Corps of Engineers' environmental reviews to be inadequate. The lawsuit came on the heels of a controversial roundup of wild horses conducted by the Bureau of Land Management, during which several died, prompting denials by the agency that the horses were removed to benefit Ruby.
Meanwhile, native groups have suggested they were not adequately consulted regarding Ruby, while Keystone XL stakeholders have expressed a range of concerns, including pipeline and refinery safety, chemical use, pipeline pressure, and what happens to the pipeline at the end of its useful life. TransCanada has apparently threatened to use eminent domain if landowners along the federally approved route do not sign easements, suggesting that compensation issues remain outstanding.
With billions of dollars at stake, it's understandable that TransCanada and El Paso are eager to complete their respective projects on time and within budget. Armed with the authority and legitimacy that legal permits provide, companies often think their 'social license(s) to operate' will be a slam-dunk. However, it's a mistake to assume stakeholders will hew to a construction schedule, rather than their own timetable, when making potentially life-changing decisions. So while both TransCanada and El Paso claim to be engaging proactively with stakeholders, neither can afford the appearance of driving over their concerns with a bulldozer.

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