New U.S. permit to boost Keystone pipeline oil exports by next year: TC Energy

New U.S. permit to boost Keystone pipeline oil exports by next year: TC Energy

New U.S. permit to boost Keystone pipeline oil exports by next year: TC Energy

CALGARY — The CEO of TC Energy Corp. says the company will begin moving more oil from Western Canada into the United States by next year under a new U.S. presidential permit for the existing Keystone pipeline system.

The permit quietly issued on Wednesday by the Trump administration allows capacity on Keystone to increase by 170,000 barrels per day to about 760,000 bpd, filling a gap as TC Energy’s expansion Keystone XL project faces delays due to ongoing court battles.

“We are very pleased with yesterday’s decision by President Trump to sign a new presidential permit for the base Keystone system,” said TC Energy CEO Russ Girling on a conference call Thursday to discuss second-quarter results.

“The new permit will allow us to respond to market demand and to fully utilize the Keystone system to safely deliver additional crude oil from Canada to the refining centres in the U.S. Midwest and the Gulf Coast.”

The new permit will allow the Calgary-based company to proceed by next year with some 50,000 barrels per day of added service, which received shipper support in a process in June 2019, Girling added.

The 50,000 bpd can be achieved by adding drag reducing agents to the oil to improve the flow efficiency of the existing pipeline without any major capital investments, said Bevin Wirzba, senior vice-president for liquids pipelines, on the call.

Using the rest of the increased capacity could involve more spending, he said, adding pursuing those projects would follow an assessment of shipper demand.

The additional capacity is likely to be welcomed in Alberta. The province limits oil production through quotas introduced in early 2019 to avoid price discounts that widened as output growth — mainly from the oilsands — outpaced growth in pipeline capacity.

Alberta Energy Minister Sonya Savage also welcomed the new U.S. permit.

“This decision sets the stage to significantly increase the capacity of the existing, base Keystone system,” she said in a news release late Wednesday.

“This is excellent news for Canada’s energy sector, and hard-working people and families on both sides of the border who benefit from continued North American energy security and interdependence.”

TC Energy announced March 31 it would go ahead with the US$8-billion Keystone XL project after the Alberta government agreed to invest C$1.5 billion and provide a loan guarantee to jump start the work.

Keystone XL is facing a court challenge in the U.S. that questions the validity of its presidential permit while also dealing with a court decision that blocked a key environmental permit that allowed the pipeline to cross rivers and streams.

Construction is continuing in the U.S. on the 1,947-kilometre project, Girling said Thursday, with a revised schedule that focuses the work on areas where permits are in hand.

The expansion is to carry 830,000 bpd of crude per day from Hardisty, Alta., to Steele City, Neb., to connect with other pipelines.

The campaign for Democratic presidential candidate Joe Biden has said he would cancel the Keystone XL permit if he wins in the November presidential election.

TC Energy said it earned $1.3 billion or $1.36 per diluted share for the three months ended June 30, up from $1.1 billion or $1.21 per share a year earlier.

The results included an after-tax gain of $408 million related to the sale of a 65 per cent equity interest in the Coastal GasLink pipeline in B.C. and an incremental after-tax loss of $80 million due to Ontario natural gas-fired power plant assets sold in April.

Adjusted profits decreased 6.6 per cent to $863 million or 92 cents per share, in line with analyst forecasts, according to financial markets data firm Refinitiv. That compared with $924 million or $1 per share in adjusted earnings in the second quarter of 2019.

Revenues dropped 8.4 per cent to $3.09 billion of revenues from $3.37 billion in the prior year.

TC Energy said its assets have been largely unimpacted by COVID-19 with flows and utilization levels remaining in line with historical and seasonal norms and largely insulated from short-term volatility of commodity prices.

This report by The Canadian Press was first published July 30, 2020.

Companies in this story: (TSX:TRP)

Dan Healing, The Canadian Press

Keystone XL

Just Posted

Orange shirts, shoes, flowers and messages are displayed on the steps outside the legislature in Victoria, B.C., on Tuesday, June 8, 2021 following a ceremony hosted by the Songhees and Esquimalt First Nations in honour of the 215 residential school children whose remains have been discovered buried near the facility in Kamloops, B.C. THE CANADIAN PRESS/Chad Hipolito
Alberta city cancels Canada Day fireworks at site of former residential school

City of St. Albert says that the are where the display was planned, is the site of the former Youville Residential School

FILE – Perry Bellegarde, National Chief of the Assembly of First Nations, takes part in an event on Parliament Hill in Ottawa on Tuesday, July 7, 2020. THE CANADIAN PRESS/Sean Kilpatrick
Indigenous Peoples Day must be a ‘call to action’, says Assembly of First Nations chief

Discovery of children at Kamloops residential school site must lead to change, Perry Bellegarde says

Intricate cloth masks with Indigenous design made by Teresa Snow. Facebook/ Masks4Maskwacis
‘Masks 4 Maskwacis’ wins Northern Lights Volunteer Award

The group received recognition for their efforts to support their community during COVID-19.

The Government of Alberta identified 115 new COVID-19 cases Sunday, bringing the provincial total to 3,089.
(Black Press file photo)
Alberta reports 100 new cases of COVID-19

The Central zone sits at 218 active cases

The Government of Alberta identified 115 new COVID-19 cases Sunday, bringing the provincial total to 3,089.
(Black Press file photo)
Red Deer drops to 71 active cases of COVID-19

Province adds 127 new cases of the virus

Marco Mendicino, Minister of Immigration, Refugees and Citizenship during a press conference in Ottawa on Thursday, May 13, 2021. THE CANADIAN PRESS/Sean Kilpatrick
Canada to welcome 45,000 refugees this year, says immigration minister

Canada plans to increase persons admitted from 23,500 to 45,000 and expedite permanent residency applications

Tl’etinqox-lead ceremony at the site of the former St. Joseph’s Mission in Williams Lake, B.C., June 18, 2021. (Angie Mindus photo - Williams Lake Tribune)
‘We are all one people’: Honouring residential school victims and survivors

Love, support and curiousity: Canadians urged to learn about residential schools and their impact

National Indigenous Peoples Day is June 21 in Canada. (Government of Canada photo)
Alberta RCMP recognizes National Indigenous Peoples Day 2021

This year, June 21 marks the 25th anniversary of National Indigenous Peoples… Continue reading

Indigenous rights and climate activists gathered outside Liberty Mutual’s office in Vancouver to pressure the insurance giant to stop covering Trans Mountain. (Photo by Andrew Larigakis)
Activists work to ensure Trans Mountain won’t get insurance

Global campaign urging insurance providers to stay away from Canadian pipeline project

Investigators use a bucket to help recover human remains at a home burned in the Camp fire, Thursday, Nov. 15, 2018, in Magalia, Calif. Many of the missing in the deadly Northern California wildfire are elderly residents in Magalia, a forested town of about 11,000 north of the destroyed town of Paradise. (AP Photo/John Locher)
‘Forever War’ with fire has California battling forests instead

Five of the state’s largest-ever blazes seared California last year, as authorities tackle prevention

Tokyo 2020 President Seiko Hashimoto and IOC President Thomas Bach, on a screen, speak during a five=party online meeting at Harumi Island Triton Square Tower Y in Tokyo Monday, June 21, 2021. The Tokyo Olympics will allow some local fans to attend when the games open in just over a month, Tokyo organizing committee officials and the IOC said on Monday. (Rodrigo Reyes Marin/Pool Photo via AP)
Tokyo Olympics to allow Japanese fans only, with strict limits

Organizers set a limit of 50% capacity — up to a maximum of 10,000 fans

The border crossing into the United States is seen during the COVID-19 pandemic in Lacolle, Que. on February 12, 2021. THE CANADIAN PRESS/Paul Chiasson
VIDEO: Border quarantine to soon lift for fully vaccinated Canadians

Eligible travellers must still take multiple COVID-19 tests

Blair Lebsack, owner of RGE RD restaurant, poses for a portrait in the dining room, in Edmonton, Friday, June 18, 2021. Canadian restaurants are having to find ways to deal with the rising cost of food. THE CANADIAN PRESS/Jason Franson
Canadian restaurateurs grapple with rising food costs, menu prices expected to rise

Restaurants are a low margin industry, so there’s not a lot of room to work in additional costs

Most Read