TransCanada delays Keystone XL in-service date to second-half 2015

TransCanada Corp. is pushing back the in-service date for its Keystone XL pipeline from late-2014 or early-2015 to second-half 2015.

The move follows on-going delays in issuing the US Presidential Permit for the project and comes just days after Canada’s Natural Resources Minister Joe Oliver remarked at the Center for Strategic and International Studies in Washington, DC, that stopping Keystone XL construction would not keep Alberta’s oil sands resources “in the ground” (OGJ Online, Apr. 24, 2013).

Nebraska state officials in January approved TransCanada’s proposed re-route after the Nebraska Department of Environmental Quality issued its final evaluation report noting that construction and operation of Keystone XL is expected to have minimal environmental impacts in Nebraska.

The US Department of State released its Draft Supplemental Environmental Impact Statement for the Keystone XL Pipeline in March, reaffirming that construction of the proposed pipeline from the US-Canada border in Montana to Steele City, Neb., would not result in any significant impact to the environment. The DOS is in the process of reviewing comments on the impact statement that it received during a 45 day public comment period that ended on Apr. 22.

Once the DOS has completed its review, TransCanada expects it will issue a final supplemental environmental impact statement and then consult with other governmental agencies during a national interest determination period of up to 90 days, before making a decision on the Presidential Permit application. In the meantime, however, the US Environmental Protection Agency urged DOS to look closely at alternative routes before issuing its FSEIS (OGJ Online, Apr. 23, 2013).

TransCanada noted that its current $5.3-billion cost estimate for Keystone XL would increase depending on the timing of the permit. As of Mar. 31 the company had spent $1.8-billion on the project.

Work continues on TransCanada’s 36-in. OD Gulf Coast Project pipeline from Cushing, Okla., to Port Arthur, Tex., with the company expecting an in-service date of end-2013. The company said work is roughly 70% complete.

TransCanada plans to begin building the 47-mile Houston Lateral to transport crude oil to Houston refineries in mid-2013 and complete it by mid-2014. The Gulf Coast Project will have an initial capacity of up to 700,000 b/d.

The company is currently holding an open season for its proposed Energy East Pipeline to move crude from western receipt points to eastern Canadian markets.  Energy East involves converting 1,864 miles of TransCanada’s Canadian Mainline natural gas system to crude oil service and building up to 870 miles of new pipeline. Subject to the results of the open season, which closes June 17, the project will transport as much as 850,000 b/d by late 2017.

TransCanada said Fort Hills Energy LP had not indicated that its recent decision to cancel the Voyageur upgrader project (OGJ Online, Mar. 27, 2013) had changed its plans for the Northern Courier bitumen and diluent pipeline system. Fort Hills in August selected TransCanada to design, build, own, and operate the 90-km pipeline between the Fort Hills mine site and Voyageur, north of Fort McMurray, Alta.

TransCanada said it had completed the work necessary to file permit applications with Canada’s Energy Resources Conservation Board and expects to do so later this quarter.

 

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