The Canada Energy Regulator (CER) granted a route change request for the Trans Mountain Expansion (TMX) project on Monday, clearing a major hurdle and avoiding months of further delay for the project that is owned by the Canadian government.
Trans Mountain Corp (TMC), the crown corporation that is building the expansion, had sought a route deviation on a 1.3-kilometre (0.8 mile) section of pipeline near Kamloops, British Columbia, to avoid planned micro-tunneling construction that it said would be unfeasible.
The controversial pipeline, now expected to cost C$30.9 billion ($22.97 billion), has been subject to lengthy regulatory delays and large cost overruns. In 2018, the Canadian government bought it out to ensure its construction.
TMX is meant to start shipping crude late in the first quarter of 2024 but the last-minute route deviation request, filed in August, had raised concerns the pipeline could face further delays. The corporation has also said building the micro-tunnel could cost as much as C$86 million.
The CER held a three-day hearing in Calgary last week, hearing testimony and cross-examinations from both parties, to determine whether to grant TMX's request.
The Stk'emlupsemc Te Secwepemc Nation (SSN) First Nation, whose territory the pipeline crosses, had opposed the TMC's proposal to avoid micro-tunneling by instead laying the pipeline through a different area on SSN land, using horizontal drilling and a conventional open trench.
But the TMC said being forced to continue with micro-tunneling could mean the pipeline segment would not be completed until December 2024, versus a January completion date that year if the route adjustment was granted.
Once operational, TMX will ship an extra 590,000 barrels per day of crude to Canada's Pacific Coast, opening up Asian as well as U.S. West Coast markets to Canadian oil producers.
(C$1 = $0.7429)
