Quebec to Impose Conditions on TransCanada Pipeline

TransCanada Corp's plans for a C$12 billion ($10.6 billion) pipeline to ship Alberta oil to Canada's East Coast face new obstacles with the province of Quebec imposing conditions before allowing the project to proceed through its territory, according to media reports on Thursday.

Quebec's demands for the project, which TransCanada calls Energy East, come just days after a failed vote in the U.S. Senate aimed at forcing presidential approval of TransCanada's controversial Keystone XL pipeline, which would move crude from the Alberta oil sands to the U.S. Gulf Coast.

The Canadian Broadcasting Corporation said that Quebec Environment Minister David Heurtel, in a letter to the company, has set out seven conditions that Energy East must meet. They include an environmental assessment that examines its impact on greenhouse gas emissions as well as an outline of the pipeline's economic benefits for the province.

Energy East would take 1.1 million barrels per day of crude oil to refineries in Quebec and New Brunswick as well as to ports in both provinces for export. About 700 kilometers (434 miles) of the line's 4,600-kilometer route would run through Quebec.

Quebec's demands are similar to five conditions set out by the province of British Columbia for approving Enbridge Inc's Northern Gateway pipeline from Alberta to an export port on British Columbia's North Pacific Coast. But unlike British Columbia, Quebec is not demanding a share of pipeline revenue.

Tim Duboyce, a spokesman for TransCanada, confirmed it had received a letter outlining Quebec's demands but declined further comment.

TransCanada shares were up 0.3 percent at C$57.66 at midmorning on the Toronto Stock Exchange.

($1=$1.13 Canadian)

(Reporting by Scott Haggett; Editing by Jeffrey Hodgson; and Peter Galloway)