Final week, Trans Mountain requested the regulator to rethink its denial of the variance request, saying the corporate now believes its development challenges in B.C. are extra important than first indicated
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The Canada Power Regulator is citing security issues as its motive for refusing a request by Trans Mountain Corp. for a pipeline variance.
In a written assertion launched Wednesday, the regulator offered its clarification for its denial earlier this month of the Crown company’s request for permission to make use of a special diameter, wall thickness and coating for a 2.3-kilometre stretch of the Trans Mountain pipeline growth challenge at present beneath development in B.C.
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The corporate mentioned on the time it had run into challenges drilling via arduous rock within the space, and warned of a doable 60-day delay within the completion of the challenge if it isn’t granted a variance.
However the regulator mentioned Wednesday it has critical issues with the standard of supplies Trans Mountain has procured to assemble the variance, including it doesn’t consider the corporate has demonstrated it may possibly assure an acceptable degree of security and pipeline integrity if it goes forward with the change.
“Having pipe or elements with mechanical properties not assembly specs may result in failure of the pipe or elements beneath stress testing or working situations, which may affect individuals and the atmosphere,” the Canada Power Regulator’s written assertion mentioned.
The event is simply the newest in a sequence of hurdles Trans Mountain Corp. has confronted because it races towards the clock to complete its large pipeline development challenge.
The Trans Mountain pipeline is Canada’s solely oil pipeline to the west coast, and its growth will enhance the pipeline’s capability to 890,000 barrels per day from 300,000 bpd at present.
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The challenge’s completion, which had been anticipated in early 2024, is eagerly awaited by this nation’s power business, which can profit from improved entry to export markets.
The pipeline growth can be anticipated to scale back the Western Canada Choose differential, which is a time period for the low cost Canadian oil firms usually tackle their product partially resulting from lack of export capability.
Trans Mountain says it doubtlessly faces ‘catastrophic’ two-year delay
However the pipeline challenge has run into development difficulties in its residence stretch. Trans Mountain has already needed to alter the route barely close to Kamloops, B.C. resulting from problem drilling a tunnel.
Final week, Trans Mountain requested the regulator to rethink its denial of the variance request, saying the corporate now believes its development challenges in B.C. are extra important than first indicated.
It mentioned it now has motive to consider that continuing with the present development plan via advanced arduous rock situations may compromise a borehole and outcome within the failure of drilling tools.
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This might end in a “catastrophic” two-year delay for the challenge, the corporate mentioned, including Trans Mountain Corp. will incur $200 million in misplaced revenues for every month of delay.
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The regulator has not but responded to this second variance request. In its software, Trans Mountain requested the regulator to decide earlier than Jan. 9 so as to forestall pointless delays.
The federal authorities bought the Trans Mountain pipeline in 2018 in an effort to get the growth challenge over the end line after it was scuttled by earlier proprietor Kinder Morgan Canada.
The challenge’s prices have spiralled via the course of development from an authentic estimate of $5.4 billion to the latest estimate of $30.9 billion.
This report by The Canadian Press was first revealed Dec. 20, 2023.
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