Canada's Trans Mountain pipe expansion to start in April (updated)

Par Pacific Holdings

24/01/2024 19:37

(Updates with comments from U.S. refiners)
    By Arathy Somasekhar and Georgina McCartney
       HOUSTON, Jan 24 (Reuters) - Canada's Trans Mountain Corp
will begin adding crude oil to its long-delayed pipeline
expansion and expects it to be operating in the second quarter,
an executive said on Wednesday.
    The C$30.9-billion ($23.05 billion) expansion will nearly
triple the flow of crude on Trans Mountain from Alberta to
Canada's Pacific Coast but has been plagued by years of delays
and cost overruns.  
    The start-up is expected in early April and will ramp up to
full capacity by the end of the year, Jason Balasch, a senior
director at Trans Mountain, said at the Argus Crude Summit in
Houston. 
    The main challenge remaining with the expansion is
installing a section of the pipeline through a mountain, which
the company expects to complete early next week. 
    Canadian oil producers will ramp up output in the next
couple of years and fill the expanded capacity, executives at
the conference said. 
        Oil production will rise and deep discounts on Canadian
crude ease as the pipeline comes online, said Jerry Miller, a
senior vice president at U.S. oil refiner HF Sinclair.
    U.S. refiners Delek US Holdings  DK.N  and Phillips 66
 PSX.N  said they expect higher Canadian volumes to the West
Coast to reduce prices there, offsetting some of the impact from
higher prices in the U.S. mid-continent, which will see less
Canadian crude flows once TMX is online.
    "TMX has multiple knock-on effects in our organization,"
said Will Monteleone, president of Par Pacific Holdings
 PARR.N , which processes Canadian crude oil at its refinery in
Washington state. It also buys competing crude oil from Alaska
and Latin America for a refinery in Hawaii. 
    Flows of Canadian crude oil to the U.S. Gulf Coast have been
consistent and will not change with the expansion, pipeline
operators Energy Transfer  ET.N  and Enterprise Products  EPD.N 
said.

 (Reporting by Arathy Somasekhar and Georgina McCartney in
Houston;
Editing by Alistair Bell)
 ((arathy.s@thomsonreuters.com; +1 832 610 7346; Twitter:
@ArathySom;))