Trans Mountain pipeline project runs into fresh construction related hurdle | 24CA News
The Trans Mountain oil pipeline growth challenge has run into one other construction-related hurdle that would delay its completion.
The crown company that owns the pipeline has filed for regulatory approval to change the route of one of many remaining stretches of pipe but to be accomplished.
In its regulatory submitting, Trans Mountain Corp. stated it has run into engineering difficulties associated to the drilling of a tunnel in B.C. and desires to change the route barely for a 1.3-kilometre stretch of pipe, in addition to the building methodology.
But the submitting paperwork illustrate how the corporate is going through opposition from the Stk’emlupsemc te Secwepemc Nation, whose conventional territory the pipeline crosses and who had agreed to the initially proposed route and building methodology.
The paperwork state that between May and July 2023, Trans Mountain Corp. met and corresponded a number of instances with the First Nation’s management, who continued to precise concern that the pipeline challenge was deviating from its beforehand agreed-upon route and building methodology.
In its submitting, Trans Mountain Corp. stated it wants the regulator to decide as quickly as doable to keep away from building delays that would end in “significantly increased construction costs” for the challenge.
It additionally warns of prices and impacts to “various third parties who are relying on the timely completion” of the challenge.
The Trans Mountain pipeline is Canada’s solely pipeline system transporting oil from Alberta to the West Coast. Its growth, which is at the moment underneath approach, will enhance the pipeline’s capability to 890,000 barrels per day (bpd) from 300,000 bpd at the moment.
Trans Mountain Corp.’s goal date for the mechanical completion of the growth challenge had been someday throughout the third quarter of this 12 months, with the pipeline’s in-service date anticipated in early 2024.
However, the challenge has been stricken by difficulties. The pipeline was purchased by the federal authorities for $4.5 billion in 2018 after earlier proprietor Kinder Morgan Canada Inc. threatened to scrap the pipeline’s deliberate growth challenge within the face of environmentalist opposition.
Its projected price ticket has since spiraled, first to $12.6 billion, then to $21.4 billion, and most just lately, to $30.9 billion (the latest capital price estimate, as of March of this 12 months).
Trans Mountain Corp. has blamed the fee overruns on quite a lot of elements, together with inflation, COVID-19, labour and provide chain challenges, flooding in B.C. and sudden main archeological discoveries alongside the route.
The federal authorities has indicated it doesn’t want to be the long-term proprietor of Trans Mountain.
On Wednesday, Prime Minister Justin Trudeau confirmed that the federal government is at the moment in talks with potential consumers. (Quite a lot of Indigenous-led initiatives and partnerships have beforehand expressed curiosity in proudly owning the pipeline.)
“I’m very excited and interested that there are so many Indigenous groups interested in purchasing the TMX pipeline,” Trudeau informed reporters in Charlottetown.
“We’re engaged in conversations with them right now, it would be premature to speculate too much on that.”
However, critics have recommended that Trans Mountain’s mounting prices will imply the federal government must take in a major loss when it does promote the pipeline. Because of the best way current contractual agreements with oil shippers are structured, solely a portion of the rising capital prices of the challenge may be handed on to grease firms within the type of elevated tolls. (Tolls are the charges oil firms pay to shift product on a pipeline, and they’re how the pipeline firm makes cash.)
A report from the Parliamentary Budget Officer final 12 months discovered the federal authorities stands to lose cash from its funding within the pipeline, and recommended that if the challenge had been cancelled at the moment, the federal government would want to put in writing off greater than $14 billion in belongings.
Trudeau stated Wednesday that the pipeline stays an necessary challenge for the Canadian economic system that ensures future markets for this nation’s oil and gasoline sources.
“We are confident that the business case for the Trans Mountain pipeline remains solid,” he stated.
© 2023 The Canadian Press
