Trans Mountain Corporation said that it filed a negotiated settlement with the Canada Energy Regulator covering tolling, tariff, and service terms on the Trans Mountain Pipeline System. The company said the parties backing the agreement represent the “substantial majority” of contracted firm shipment volumes, but the settlement remains subject to regulator approval.
The key number is not just the toll. If approved, the settlement would increase firm contracted capacity on the 890,000 barrel-per-day system from 80% to 90% of nominal pipeline capacity. That would reduce the pipeline’s exposure to uncommitted spot shipments and give Trans Mountain a more stable contracted base at a time when its long-term valuation depends on proving that the expanded system can earn predictable cash flow.
The agreement would also resolve issues before the CER in proceeding RH-002-2023, finalize tolls from May 1, 2024 to the day before the settlement’s effective date, and establish future tolling frameworks for firm and uncommitted shippers. Trans Mountain asked the regulator to approve the application by October 1, 2026, with a potential effective date of January 1, 2027.
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The toll dispute had become the commercial hangover from the government’s rescue of the project. Reuters reported that oil companies had resisted higher tolls tied to cost overruns from the $34 billion expansion, which was completed by the Canadian government in 2024.
The CER says pipeline tolls are the fees charged to shippers, and that they must be “just and reasonable” and not unjustly discriminatory. The regulator had previously allowed Trans Mountain’s interim toll application proceeding to remain paused while the company negotiated with firm shippers, but said the Commission would still need to rule on tolls submitted by Trans Mountain.
The broader commercial question is who absorbs the cost of turning Trans Mountain from a delayed public works headache into Canada’s main westbound oil export corridor. Reuters reported in 2025 that the tolling uncertainty had complicated Ottawa’s eventual plan to sell the pipeline, because buyers would need clarity on long-term revenue potential.
Cenovus Energy, Canadian Natural Resources, and ConocoPhillips Canada were reportedly among shippers involved in earlier talks.
Trans Mountain framed the settlement as evidence of demand rather than concession. CEO Mark Maki said the agreement provides a “clear path forward” and gives customers and stakeholders more predictability while connecting Canadian crude to global markets. The company also said the expanded system had run at full capacity for consecutive months.
The settlement is paired with a second move: more capacity. Trans Mountain said its Mainline Optimization Program, including drag-reducing agents and targeted facility upgrades, could add up to 300,000 barrels per day of incremental capacity by the end of 2028. It also said it had received the first regulatory permit needed to advance the program and expects a possible 10% throughput increase, or about 90,000 barrels per day, by year-end.
The company plans to run an open season for that incremental capacity from July 13 to August 10, giving prospective shippers a chance to secure access to part of the future capacity. Detailed commercial terms will be provided confidentially to eligible participants, according to Trans Mountain.
The policy stakes are larger than Trans Mountain’s own balance sheet. The pipeline is Canada’s only direct oil pipeline route to the West Coast, and Reuters reported that it offers access to China and other Asian markets as Canada seeks to diversify crude exports away from the US.
But the deal also narrows flexibility. Raising firm capacity to 90% means only 10% of nominal capacity would remain available for spot shipments, down from 20%, if regulators approve the shift. That may improve revenue visibility for Trans Mountain, but it also changes how scarce westbound pipeline space is allocated between long-term shippers and uncommitted barrels.
