Newspaper article The Canadian Press

TransCanada Pushes In-Service Date for Keystone XL into Early 2015: Keystone XL In-Service Date Pushed Back

Newspaper article The Canadian Press

TransCanada Pushes In-Service Date for Keystone XL into Early 2015: Keystone XL In-Service Date Pushed Back

Article excerpt

CALGARY - TransCanada said Tuesday it expects its controversial Keystone XL oil pipeline to come into service a few months later than expected as customers embrace the idea of tackling the project in smaller pieces.

The Calgary-based pipeline and utility giant (TSX:TRP) is now aiming for the US$7.6-billion, Alberta-to-Texas pipeline to come into service in early 2015 instead of its previous target of late 2014.

It said customers have expressed support for TransCanada getting to work on the most urgently needed portions of the line instead of waiting for the entire project to be approved, which is not likely to happen before the November presidential election.

Keystone XL has suffered two big setbacks in recent months.

In November, a decision by the U.S. State Department was delayed until early 2013 to work out a new route through Nebraska. Then last month, the Obama administration rejected a permit because Republican efforts to force a decision within 60 days did not allow enough time to study the new route.

"We've always said that the time period for construction of Keystone XL would be two full years, and we're just taking a look at the time frame," Alex Pourbaix, president of oil pipelines, told analysts and reporters on a conference call.

"We believe that a reasonable date to get a new presidential permit is in Q1 of 2013, and it was really just simple math."

With a first quarter 2015 in-service date, Pourbaix said "we expect to have no problems whatsoever maintaining the vast majority of our shipping commitments."

An outlet for crude from the Bakken region of North Dakota and Montana is badly needed, and a supply glut at a massive storage hub in Cushing, Okla., is pushing down North American crude prices. But the need for new pipelines out of Alberta won't be felt for at least a few years.

"There is an obvious and real need to take care of that bottleneck in Cushing and over the last month we've received a lot of inbound interest from potential shippers as to whether we could go forward with the Cushing-to-Gulf Coast phase," Pourbaix said. …

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