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Final week, Trans Mountain requested the regulator to rethink its denial of the variance request, saying the corporate now believes its building challenges in B.C. are extra vital than first indicated
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Printed Dec 20, 2023 • 3 minute learn
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The Canada Vitality 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 supplied its clarification for its denial earlier this month of the Crown company’s request for permission to make use of a unique diameter, wall thickness and coating for a 2.3-kilometre stretch of the Trans Mountain pipeline enlargement mission at present underneath building in B.C.
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The corporate mentioned on the time it had run into challenges drilling via laborious rock within the space, and warned of a doable 60-day delay within the completion of the mission if it isn’t granted a variance.
However the regulator mentioned Wednesday it has severe 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 well assure an acceptable stage 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 underneath stress testing or working circumstances, which may affect individuals and the surroundings,” the Canada Vitality Regulator’s written assertion mentioned.
The event is simply the newest in a collection of hurdles Trans Mountain Corp. has confronted because it races towards the clock to complete its huge pipeline building mission.
The Trans Mountain pipeline is Canada’s solely oil pipeline to the west coast, and its enlargement will increase the pipeline’s capability to 890,000 barrels per day from 300,000 bpd at present.
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The mission’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 enlargement can be anticipated to scale back the Western Canada Choose differential, which is a time period for the low cost Canadian oil corporations usually tackle their product partly as a consequence of lack of export capability.
Trans Mountain says it doubtlessly faces ‘catastrophic’ two-year delay
However the pipeline mission has run into building difficulties in its residence stretch. Trans Mountain has already needed to alter the route barely close to Kamloops, B.C. as a consequence of 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 building challenges in B.C. are extra vital than first indicated.
It mentioned it now has motive to consider that continuing with the present building plan via advanced laborious rock circumstances may compromise a borehole and consequence within the failure of drilling gear.
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This might lead to a “catastrophic” two-year delay for the mission, the corporate mentioned, including Trans Mountain Corp. will incur $200 million in misplaced revenues for every month of delay.
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Regulator denies Trans Mountain’s pipeline variance request
The regulator has not but responded to this second variance request. In its utility, Trans Mountain requested the regulator to decide earlier than Jan. 9 with a purpose to stop pointless delays.
The federal authorities bought the Trans Mountain pipeline in 2018 in an effort to get the enlargement mission over the end line after it was scuttled by earlier proprietor Kinder Morgan Canada.
The mission’s prices have spiralled via the course of building from an authentic estimate of $5.4 billion to the newest estimate of $30.9 billion.
This report by The Canadian Press was first printed Dec. 20, 2023.
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