Canadian Infrastructure Projects Gain First-Mover Advantage

While the U.S. procrastinates, Canada is taking concrete action to ensure its ability to increase crude exports into both the Atlantic and Pacific basins with the development of new pipelines, says an analyst with the research and consulting firm GlobalData. According to Carmine Rositano, GlobalData’s managing analyst covering downstream oil and gas, Canada is developing infrastructure, including the proposed East Energy Access Pipeline project, on both its west and east coasts.

GlobalData expects the East Energy Access Pipeline project to transport about 1.2 MMbbld of crude oil from Alberta to refineries in Montreal, Quebec, and New Brunswick, with marine terminals for potential export purposes. The project consists of converting a natural gas pipeline to oil, reversing the flows of existing pipelines, and the construction of new pumping stations, tank terminals, and marine facilities.

“The ability to move incremental volumes of oil to the east coast would also provide export opportunities to both India and Europe, reducing the latter’s dependency on Russian supplies that currently meet about 30% of its energy requirements,” Rositano said. Furthermore, two major projects have been proposed for the transportation of incremental production from Alberta to Canada’s west coast ports. This would result in the availability of more than 1 MMbbld of crude oil for export to the Asia-Pacific region, according to GlobalData.

The Northern Gateway project involves a crude oil export pipeline and condensate import pipeline between Alberta and a new marine terminal in Kitimat, B.C. GlobalData expects this project to transport 525,000 bbld of oil sands crude from Alberta to the Asia-Pacific region and U.S. west coast. In addition, an expansion project has been designed to increase the Trans Mountain Pipeline from 300 Mbbld to 890 Mbbld. “The Trans Mountain Pipeline project would involve building 12 new pump stations, 20 new tanks, and a new twinned pipeline that will closely follow the existing Trans Mountain right-of-way,” explained Rositano. “Approval is currently being sought from Canada’s National Energy Board and, if all goes well, construction would start in 2015, with operations commencing in 2017-2018.”