The Energy East Pipeline project involves converting a portion of natural gas pipeline capacity in approximately 3,000 km (1,864 miles) of TransCanada’s existing Canadian Mainline to crude oil service and constructing approximately 1,400 km (870 miles) of new pipeline. The pipeline will transport crude oil from receipt points in Alberta and Saskatchewan to delivery points in Montreal, the Québec City region and Saint John, New Brunswick. The pipeline will terminate at Canaport in Saint John, where TransCanada and Irving Oil have formed a joint venture to build, own and operate a new deep water marine terminal.
“We are very pleased with the outcome of the open season for the Energy East Pipeline held earlier this year and are excited to move forward with a major project that will bring many benefits across Canada,” said Russ Girling, TransCanada’s president and CEO. “This is an historic opportunity to connect the oil resources of western Canada to the consumers of eastern Canada, creating jobs, tax revenue and energy security for all Canadians for decades to come.”
Girling added that interest in Energy East supports refineries’ desire to have access to a stable and reliable supply of western Canadian crude oil — pushing out more expensive crude oil from foreign regimes. Eastern Canada currently imports approximately 700,000 bpd. It also confirms the desire producers have to support safe and innovative ways to get their crude oil to market.
“Energy East is one solution for transporting crude oil but the industry also requires additional pipelines such as Keystone XL to transport growing supplies of Canadian and U.S. crude oil to existing North American markets,” Girling said. “Both pipelines are required to meet the need for safe and reliable pipeline infrastructure and are underpinned with binding, long-term agreements.”
The project is expected to cost approximately $12 billion, excluding the transfer value of Canadian Mainline natural gas assets. The Energy East Pipeline will have a capacity of approximately 1.1 million bpd and is anticipated to be in service by late 2017 for deliveries in Québec and 2018 for deliveries to New Brunswick.
While Energy East will use a portion of Canadian Mainline capacity, TransCanada is committed to continuing to meet the needs of its gas customers in eastern Canada and the northeastern United States. Construction is expected to begin in early 2014.