Trans Mountain Pipeline to soon be at full capacity amid global energy crisis
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The Trans Mountain oil pipeline system is expected to operate at full capacity in April and May as a result of energy disruptions caused by the war in the Middle East.
Pair of pipelines transport oil from Edmonton to a terminal in Burnaby, BC
Typically, the majority of oil exported is destined for China and other Asian countries, which have a growing appetite for energy now that global supply is constrained by the conflict.
A complete pipeline system would mark a milestone that Trans Mountain was hoping to reach in only a few years. 12 months ago the pipeline was operating at between 80 and 90 percent capacity.
“The system is basically full,” said Mark Maki, chief executive of Trans Mountain.
Energy prices have surged in the past month as Iran restricted access to the Strait of Hormuz, the geographic choke point through which 20 percent of the world’s oil is exported in addition to natural gas and other products.
“It takes a while for the market to understand the conflict,” Maki said in an interview with CBC News on the sidelines of the CERAWeek energy conference in Houston. “So, what we’re starting to see now is a shift to North America as a source.”
Asian customers “are extremely interested in Canadian barrels, full stop. They like the country, they like the product that comes to them,” he said.
Should the conflict in the Middle East end, experts say it could take months for energy markets to return to normal. Asian countries have been hardest hit by the energy crisis, with some countries already facing shortages of oil and natural gas.
On Tuesday, Shell Chief Executive Wael Savan warned that Europe would soon begin to experience the same disruptions in fuel supplies that Asia has faced.
Further expansion projects
Meanwhile, Trans Mountain is moving forward with a pair of expansion projects to transport more oil through the existing pipeline system.
The first increase will result from the use of drag reducing agents with the goal of carrying up to 10 percent more oil. The project will cost $9 million, and construction is expected to begin this August and be completed in January 2027.
The second expansion will be more complex and involve the construction of more pumping stations. The original timeline was to complete the project by 2029, but Maki said the Crown corporation is already ordering equipment with the goal of completing the expansion in 2028.
The expansion is expected to increase capacity by an additional 360,000 barrels per day, although it still requires regulatory approval.
The twin pipeline system can currently transport about 890,000 barrels per day between Alberta and the West Coast.
