Enbridge Inc. just moved one step closer to building its Northern Gateway pipeline, despite industry concerns that new capacity could hurt oil producers.

The Calgary-based pipeline giant filed an application with the National Energy Board yesterday. If approved, the $5.5-billion project would transport oil from Edmonton to a terminal in coastal Kitimat, B.C.

A twin pipeline would ship condensate -- for thinning heavy oil -- back to Alberta. Crude could start flowing by 2016.

First Nations and environmentalists have vowed to stop the project. They claim supertankers in B.C.’s coastal waters and pipelines stretched across hundreds of streams and rivers will invite disaster.

"All the state-of-the-art technology claimed by oil companies can never eliminate human error. We will oppose this pipeline project to protect our lands, and our waters," reads a recent press release.

Enbridge, meanwhile, argues the project will boost job creation and benefit local communities.

The pipeline will also “open important new markets for Canadian crude oil,” chief executive Pat Daniel said in a statement.

Some oil sands producers are worried that a glut of pipeline capacity will make their operations more expensive. TransCanada Corp and Enbridge both plan American pipeline expansions that alone could ship about the entire oil sands output.

Unused pipeline capacity results in higher tolls, raising the cost of bitumen.

“The overbuilding of pipelines has already led to legal wrangling between producers and pipeline operators, and may sour some of those highly dependent relationships,” reads a recent Globe and Mail story.

The Tyee reported Wednesday that proposed changes to the federal Environmental Assessment Act may benefit industrial proponents such as Enbridge.

Geoff Dembicki reports for the Tyee.