The Trans Mountain pipeline has reached full capacity for the first time since its expansion was completed, boosting the pipe’s total carrying capability to 890,000 barrels daily. Indeed, this month the pipeline has seen more demand than there is capacity, a senior executive at the same-name company said, as quoted by Reuters.
The expansion of the Trans Mountain infrastructure has been crucial for Canadian oil producers’ output plans, which have focused on responding to higher demand for oil, especially from Asia and especially from China. The world’s top oil importer became the largest buyer of Canadian crude last year, taking in over 200,000 barrels daily.
Indeed, the pipeline has been such a quick success that there were warnings that more capacity increases would be needed soon, as producer interest suggested demand for capacity would exceed its availability before long. The war in the Middle East further boosted appetite for Canadian crude, as Asia – the biggest client of both Gulf states and Canada – bore the brunt of the supply crunch triggered by the war.
As a result of these developments, Trans Mountain Corp. signaled in late May that it was going to hold another open season for capacity on the pipeline, aiming to secure takers for 72,000 barrels daily in additional capacity. Another 90,000 barrels daily in additional capacity will come from the use of anti-drag agents, the company’s chief executive, Mark Maki, said at the time. That may not be the end of capacity expansion at TMX, however, with Maki also saying last year that by 2029, the pipeline could reach a total capacity of 1.2 million barrels daily.
Alberta, meanwhile, is planning a second crude pipeline to carry oil to the British Columbia coast. That second pipeline would have a capacity of another 1 million barrels daily—if it ever gets built as the project is facing stiff opposition from environmentalists.
By Irina Slav for Oilprice.com
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