Cost of Trans Mountain pipeline rises to $7.4 billion

Previous estimate for the Kinder Morgan pipeline was $6.8 billion


 
A ship receives its load of oil from the Kinder Morgan Trans Mountain Expansion Project's Westeridge loading dock in Burnaby, British Columbia, on June 4, 2015. The British Columbia government's final submission to the National Energy Board says it is unable to support Kinder Morgan's proposed pipeline expansion from Alberta to the West Coast.B.C. THE CANADIAN PRESS/Jonathan Hayward

A ship receives its load of oil from the Kinder Morgan Trans Mountain Expansion Project’s Westeridge loading dock in Burnaby, British Columbia, on June 4, 2015. THE CANADIAN PRESS/Jonathan Hayward

CALGARY – Kinder Morgan has increased the estimated cost of the Trans Mountain pipeline project to $7.4 billion and says it has confirmed shipping interest from producers.

The cost is up from the $6.8 billion previously estimated, with Kinder Morgan citing increased compliance costs including the National Energy Board’s 157 conditions, thicker pipe walls, additional drilled water crossings, and the Burnaby Mountain tunnel.

The company said shippers have reconfirmed all but three per cent of firm daily oil shipment, representing 22,000 barrels per day.

Some existing and prospective shippers had picked up capacity on other pipelines, Kinder Morgan said, so it will be making that capacity available on the open market.

In 2012, thirteen shippers made 15 and 20-year commitments of 708,000 barrels per day, representing about 80 per cent of the expanded capacity, with the remaining 20 per cent left open to spot volumes.

The company said construction is set to begin in the fall, but many groups opposed to the pipeline have launched legal challenges to try and delay the project.


 

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