Canada’s Trans Mountain Pipeline expansion project is now over 95% complete, according to recent reports. The expansion, aimed at almost tripling the existing capacity from 300,000 to 890,000 barrels per day, will facilitate the transportation of crude oil from Alberta’s oil sands to Canada’s Pacific Coast for export to Asia or the US West Coast.
Initially slated for an early 2024 launch, the project might face delays of up to two years due to a recent ruling by the Canada Energy Regulator (CER), as acknowledged by the project’s owner.
Acquired by the Canadian government for CA$4.5 billion in 2018, the Trans Mountain Pipeline is overseen by the Trans Mountain Corporation (TMC). The expansion project has encountered legal challenges from environmental activists and Canadian First Nations groups.
Canada has seen consistent growth in crude oil production over the past 13 years, with average annual production rising by nearly 2.0 million barrels per day between 2009 and 2019. Despite a temporary setback in 2020 due to the COVID-19 pandemic, production rebounded in 2022, exceeding pre-pandemic levels at 4.9 million barrels per day, according to the CER.
The majority of the growth in Canada’s crude oil production is centered in Alberta, contributing 82.7% to the national total in 2022, up from 76.1% in 2012. Currently, the United States is the primary destination for Canadian crude oil, with imports averaging around 3.7 million barrels per day since 2020, constituting 79% of Canada’s total production during that period.
However, as the US Energy Information Administration (EIA) notes, the recent refusal by the CER on December 5 to grant a variance request to Trans Mountain raises concerns about potential delays, with the project owner indicating a possible postponement of up to two years.
Information for this story was found via EIA, and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
