Coastal GasLink costs increase, end-2023 completion targeted

TC Energy Corp.’s 1.7-bcfd Coastal GasLink pipeline in Western Canada continues to face cost pressures related to its labor costs and the shortage of skilled labor, along with contractor underperformance and disputes, the company said earlier this week in advance of its annual investor day meeting. It also cited drought conditions and erosion and sediment control issues as factors leading to an expected increase in project costs.

The 670-km, 48-in. OD pipeline will carry Western Canadian Sedimentary Basin natural gas to LNG Canada’s planned 14-million tonne/year plant in Kitimat, BC. It is 80% complete, according to TC Energy, which is targeting end-2023 mechanical completion.

The company said it is “actively pursuing cost mitigants and potential recoveries from contractors to offset a portion of these costs, some of which may not be conclusively determined until after project completion.” It plans to provide an updated cost estimate in early 2023.