Trans Mountain pipeline variance request gets approved by regulator

financialpost.com:

CALGARY — The imminent completion of the Trans Mountain pipeline expansion is more likely following Friday’s decision by the Canada Energy Regulator to approve a request for a pipeline variance from the company building the project.

While the regulator imposed a number of conditions, including testing and documentation requirements for the pipe materials, it said Trans Mountain Corp. can begin constructing the variance right away.

The regulator said it will issue the reasons for its decision at a later date.

The decision — issued Friday evening just hours after the conclusion of a hearing in Calgary — is significant for Canada’s energy sector, which has been eagerly anticipating the startup of the massive pipeline project.

The Trans Mountain pipeline is Canada’s only oil pipeline to the West Coast and its expansion will increase the pipeline’s capacity to 890,000 barrels per day from 300,000 bpd currently.

Its construction, which is more than 98 per cent complete, has been underway for more than three years. Canadian oil producers have begun ramping up production in expectation of the additional export capacity, which is expected to improve the prices Canadian oil companies receive for their production.

But Trans Mountain Corp., the Crown corporation behind the project, has been racing against the clock. Construction was expected to be complete in the first quarter of this year, but the company has run into difficulties drilling through hard rock in B.C.

Its initial request to use a different size of pipe for the location in question was denied by the regulator due to concerns around pipeline quality and integrity.

But Trans Mountain Corp. then asked the regulator to reconsider, saying in December that the project could