TransCanada to proceed with $12B, 1.1M barrel/day Energy East oil pipeline project to Eastern Canada
TransCanada Corporation is moving forward with the 1.1 million barrel per day (bbl/d) Energy East Pipeline project based on binding, long-term contracts received from producers and refiners. The conclusion of the successful open season confirmed strong market support for a pipeline with approximately 900,000 bbl/d of firm, long-term contracts to transport crude oil from the oil sands area in Western Canada to Eastern Canadian refineries and export terminals.
The project is expected to cost approximately $12 billion, excluding the transfer value of Canadian Mainline natural gas assets. The Energy East Pipeline will have a capacity of approximately 1.1 million bbl/d and is anticipated to be in service by late-2017 for deliveries in Québec and 2018 for deliveries to New Brunswick.
|Energy East Pipeline conceptual route map. Click to enlarge.|
Russ Girling, TransCanada’s president and CEO, said that interest in Energy East supports refineries’ desire to have access to a stable and reliable supply of Western Canadian crude oil, pushing out more expensive crude oil from foreign regimes. Eastern Canada currently imports approximately 700,000 bbl/d. It also confirms the desire producers have to support ways to get their crude oil to market. TransCanada is the owner of the still uncertain Keystone XL pipeline, proposed to carry Western Canadian oil to US Gulf Coast refineries.
Energy East is one solution for transporting crude oil but the industry also requires additional pipelines such as Keystone XL to transport growing supplies of Canadian and US crude oil to existing North American markets. Both pipelines are required to meet the need for safe and reliable pipeline infrastructure and are underpinned with binding, long-term agreements.—Russ Girling
The Energy East Pipeline project involves converting a portion of natural gas pipeline capacity in approximately 3,000 kilometers (1,864 miles) of TransCanada’s existing Canadian Mainline to crude oil service and constructing approximately 1,400 kilometers (870 miles) of new pipeline.
The pipeline will transport crude oil from receipt points in Alberta and Saskatchewan to delivery points in Montréal, the Québec City region and Saint John, New Brunswick, greatly enhancing producer access to Eastern Canadian and international markets. The pipeline will terminate at Canaport in Saint John, New Brunswick where TransCanada and Irving Oil have formed a joint venture to build, own and operate a new deep water marine terminal.
While Energy East will use a portion of Canadian Mainline capacity, TransCanada said it is committed to continuing to meet the needs of its gas customers in eastern Canada and the NE United States.
The company intends to proceed with the necessary regulatory applications for approvals to construct and operate the pipeline project and terminal facilities in early 2014.