TransCanada kills Energy East crude line

TransCanada PipeLines Ltd. has ended plans for the Energy East Pipeline, which would have carried Alberta crude oil to the Atlantic, and the Eastern Mainline gas pipeline in Ontario.

TransCanada PipeLines Ltd. has ended plans for the Energy East Pipeline, which would have carried Alberta crude oil to the Atlantic, and the Eastern Mainline gas pipeline in Ontario.

A statement by Chief Executive Officer Russ Girling cited “changed circumstances.”

The company in September had asked the National Energy Board of Canada to suspend permitting consideration for 30 days while it considered effects of expanded environmental review (OGJ Online, Sept. 8, 2017).

On Aug. 23, the NEB announced it would “consider upstream and downstream greenhouse gas emissions in determining whether these projects are in the public interest.”

The Energy East project would have combined construction with conversion of existing pipelines to create a 4,500-km system with capacity of 1.1 million b/d between Hardisty, Alta., and refineries and terminals in eastern Canada.

The Eastern Mainline project called for 279 km of new gas pipeline between Markham and Brouseville, Ont.

Oil sands bottleneck

Energy East was one of several projects proposed to relieve a transportation bottleneck in the oil sands region of Alberta.

According to the Canadian Association of Petroleum Producers, crude production in western Canada averaged 3.9 million b/d in 2016, mostly blended and upgraded bitumen from the oil sands. The output exceeded available pipeline capacity by about 600,000 b/d.

Most production not carried away by pipeline or refined locally moves to market by rail.

TransCanada proposed the Energy East project when action on the presidential permit needed for the border crossing of its Keystone XL project, which would carry Alberta crude to the US Gulf Coast, stalled in the US. After a lengthy delay, the administration of former US President Barack Obama rejected the crossing in 2015.

President Donald Trump approved Keystone XL’s border transit in March.

If built, Keystone XL would add 830,000 b/d to oil sands takeaway capacity.

Last November, the Canadian government approved expansion of Kinder Morgan's Trans Mountain system between Alberta and Burnaby, BC, and restoration of Enbridge Inc.'s Line 3 between Alberta and the US Midwest. The combined capacity boost from those projects is 960,000 b/d.

CAPP expects crude supply from western Canada to increase by 1.5 million b/d during 2016-30.

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