Monday, April 22, 2024

Trans Mountain variance request denied resulting from pipeline security issues

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 vital than first indicated

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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 distinct diameter, wall thickness and coating for a 2.3-kilometre stretch of the Trans Mountain pipeline growth undertaking at present underneath development in B.C.

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The corporate stated on the time it had run into challenges drilling by onerous rock within the space, and warned of a attainable 60-day delay within the completion of the undertaking if it isn’t granted a variance.

However the regulator stated 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 could 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 might result in failure of the pipe or elements underneath stress testing or working situations, which might affect folks and the surroundings,” the Canada Vitality Regulator’s written assertion stated.

The event is simply the newest in a sequence of hurdles Trans Mountain Corp. has confronted because it races in opposition to the clock to complete its large pipeline development undertaking.

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 undertaking’s completion, which had been anticipated in early 2024, is eagerly awaited by this nation’s vitality trade, which is able to profit from improved entry to export markets.

The pipeline growth can be anticipated to cut back the Western Canada Choose differential, which is a time period for the low cost Canadian oil firms usually tackle their product partly resulting from lack of export capability.

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

However the pipeline undertaking 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 vital than first indicated.

It stated it now has motive to consider that continuing with the present development plan by advanced onerous rock situations might compromise a borehole and consequence within the failure of drilling tools.

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This might lead to a “catastrophic” two-year delay for the undertaking, the corporate stated, 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 utility, Trans Mountain requested the regulator to decide earlier than Jan. 9 with a view to stop pointless delays.

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

The undertaking’s prices have spiralled by the course of development from an unique estimate of $5.4 billion to the newest estimate of $30.9 billion.

This report by The Canadian Press was first revealed Dec. 20, 2023.

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