Trans Mountain variance request denied as a result of pipeline security issues

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The Canada Power Regulator is citing security issues as its cause 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 venture presently below building in B.C.

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The corporate mentioned on the time it had run into challenges drilling by way of laborious rock within the space, and warned of a attainable 60-day delay within the completion of the venture 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 might 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 below stress testing or working circumstances, which may influence folks and the surroundings,” the Canada Power Regulator’s written assertion mentioned.

The event is simply the most recent in a collection of hurdles Trans Mountain Corp. has confronted because it races towards the clock to complete its large pipeline building venture.

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 presently.

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The venture’s completion, which had been anticipated in early 2024, is eagerly awaited by this nation’s power trade, which can profit from improved entry to export markets.

The pipeline enlargement can also be anticipated to cut back the Western Canada Choose differential, which is a time period for the low cost Canadian oil corporations usually tackle their product partially as a result of lack of export capability.

Trans Mountain says it probably faces ‘catastrophic’ two-year delay

However the pipeline venture has run into building difficulties in its dwelling stretch. Trans Mountain has already needed to alter the route barely close to Kamloops, B.C. as a result 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 cause to consider that continuing with the present building plan by way of complicated laborious rock circumstances may compromise a borehole and outcome within the failure of drilling tools.

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This might lead to a “catastrophic” two-year delay for the venture, the corporate mentioned, including Trans Mountain Corp. will incur $200 million in misplaced revenues for every month of delay.

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 as a way to forestall pointless delays.

The federal authorities bought the Trans Mountain pipeline in 2018 in an effort to get the enlargement venture over the end line after it was scuttled by earlier proprietor Kinder Morgan Canada.

The venture’s prices have spiralled by way of the course of building 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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