Councillors unhappy paying $7M to Imperial Oil to co-fund pipeline relocation amid urgency to widen Sunningdale Road

Councillors frustrated over $7M Imperial Oil bill in order to proceed with widening congested stretch of road. CTV London’s Daryl Newcombe reports.

Several councillors expressed frustration about a proposed deal with Imperial Oil to relocate an unused pipeline, but begrudgingly they supported the negotiated agreement because its seems to be the only way to begin long-awaited improvements to Sunningdale Road.

Monday, the Infrastructure and Corporate Services Committee (ICSC) considered a draft agreement to pay $7 million towards the decommissioning and relocation of a 300mm oil pipeline located just north of the roadway between Sunningdale Golf and Country Club and Canvas Way (approximately 2.3 kilometres).

The city’s financial contribution would be equal to about half of the relocation costs.

“[Imperial Oil] hold a lot of the power in these discussions, and that power extends to things like permitting,” lamented Coun. Corrine Rahman.

Connecting Sarnia to Waterdown, the pipeline is currently unused but is pressurized for future utilization.

However, its shallow depth and proximity to the roadway stands in the way of the long-awaited widening of Sunningdale Road to four lanes.

Rahman points out that at the end of the agreement, a brand-new section of pipeline that’s been co-funded by London taxpayers would be generating revenue for Imperial Oil.

“As a giant, you have to understand when you’re taking advantage of folks,” Rahman added. “I think we’ve done our best, and we’ve done what we can, but we’re very limited in our ability to negotiate with them.”

“I am reticent to [support] what feels like contributing to a large gas company’s removal of a pipeline,” Coun. Skylar Franke told colleagues on the committee. “Seems like they might eventually have had to do it anyway because they don’t have anything running through it.”

The need to widen Sunningdale Road was first identified in 2012, and if the agreement with Imperial Oil is approved by council, decommissioning of the pipeline would begin soon.

The road improvements will include expanding to four traffic lanes, adding new sidewalks, cycling lanes, lighting, drainage improvements, and a new bridge across Medway Creek.

If the new section of pipeline along London’s northern boundary isn’t completed within 10 years, the city will be reimbursed for the construction phase of the project.

Eventually, the committee voted four to one (Franke opposed) to recommend accepting the agreement.

“They [need] to provide us with a permit at the end of the day, so we’re at the mercy of the pipeline operator to be able to move forward with this [road improvement] project,” Rahman told CTV News after the meeting.

She believes the financial deal reached by city staff is likely the best London can do given the circumstances, but she would like to have a further discussion with Imperial Oil about additional community benefits.

“If they’re going to, at some point, activate this pipeline then I’d like to see them get more involved in the community to support other infrastructure projects around the area,” Rahman said.

The councillor also believes that senior levels of government should become more active participants in negotiations between municipalities and the operators of pipelines and railways.

“This is where the federal government [and] the province have a role to play,” she explained. “The federal government [has] pipelines on their agenda, so let’s have them get more involved in these types of negotiations.”

If council approves the agreement with Imperial Oil at its meeting on Feb. 10, city staff believe the pipeline can be decommissioned by summer.