With its controversial Keystone XL pipeline stuck in limbo, TransCanada Corporation has announced a C$2.4-billion expansion of an unrelated natural gas pipeline system that will add a billion cubic feet to its daily shipping capacity.
Shipments will begin between November 2020 and April 2021, Bloomberg reports, based on a series of contracts that run an average of almost 29 years.
“The expansion shows TransCanada isn’t sitting still while it considers whether to move ahead with Keystone XL,” the news agency states. And “even without Keystone XL, the company’s oil transport business posted strong results. The unit’s comparable earnings before interest, taxes, depreciation, and amortization rose 33% to $401 million, helped by higher volumes on the existing Keystone system and the start of operations on its Grand Rapids and Northern Courier lines.”
The expansion to the NGTL System “may bring some relief to Canadian natural gas drillers who have suffered through wild swings in pricing, as rising production from the prolific Montney formation tries to move through a crowded pipeline network,” Bloomberg states. “The project unveiled on Thursday follows a C$2-billion expansion that TransCanada announced in June. Shippers had signed on for more than 2.6 billion cubic feet a day in new supply contracts for that project.”