Energy

Plenty of Opposition Remains to Kinder Morgan Canadian Pipeline Expansion

Paul Ausick

Published: May 20, 2016 12:40 pm

Last Updated: January 13, 2020 7:47 am

The National Energy Board of Canada (NEB) on Thursday recommended the planned expansion of the Trans Mountain oil pipeline system be approved. The existing pipeline is owned by Kinder Morgan Inc. (NYSE: KMI), which first proposed the expansion plan in 2012.

The Trans Mountain system transports crude oil from Edmonton, Alberta, to the west coast of British Columbia near the city of Vancouver. The existing pipeline transports 300,000 barrels a day of crude oil 1,150 kilometers (more than 710 miles).

The expansion project nearly triples the capacity to 890,000 barrels a day by adding a second pipeline along the existing right of way for around 73% of the distance. About 930 kilometers of the pipeline will be newly built and another 193 kilometers that are currently idled will be returned to service. The cost of the project is currently estimated at $6.8 billion and if the final approval is given in December, the expanded pipeline is expected to enter service in December 2019.

Reaction in Canada has been mixed, and for the most part, predictable. The interim CEO of the British Columbia Chamber of Commerce said:

This project is a big economic win for B.C. and for Canada. This project will bring construction, operations and other indirect jobs to B.C., while enabling our national oil resources to reach Asian markets.

24/7 Wall St.
10 Stocks to Own for the Decade