Surprise May Start for Trans Mountain Pipeline Expansion Leaves Analysts Puzzled
(Reuters) — Trans Mountain's expanded oil pipeline system will start commercial operations on May 1, the Canadian government-owned company said late on Wednesday, surprising analysts with an earlier than expected commencement on the long-delayed C$34-billion ($25.2 billion) project.
Trans Mountain previously said startup would happen in the second quarter.
Why It's Important
Canada is the fourth-largest oil producer, but output has been capped by full pipelines. Expanding Trans Mountain will increase shipments from the British Columbia (B.C.) coast to Asia and the U.S. West Coast.
Key Quote
May 1 is ambitious considering Trans Mountain needs to complete line fill and receive regulatory approvals, said Dylan White, North American crude analyst for Wood Mackenzie, adding that late May or early June is more realistic.
"Pretty well everyone with whom I’ve spoken regarding start-up was anticipating June 1," said Commodity Context analyst Rory Johnston on X.
"It takes away the (price) volatility we've seen in the recent past because of egress capacity being tight," said Eight Capital analyst Phil Skolnick.
Context
Trans Mountain ran into numerous problems during construction, most recently installing pipe in hard rock in B.C.
The expansion will nearly triple the flow of crude from Alberta to Canada's Pacific Coast to 890,000 barrels per day.
Volumes will increase gradually. The pipeline will be highly utilized as early as next year and run full in 2025-26, Trans Mountain said in March.
Market Reaction
Western Canada Select (WCS) oil initially traded little changed from the previous day, a market participant said.
Skolnick expects the WCS discount to West Texas Intermediate to drop this quarter to single digits, from about $12 per barrel currently, as the expanded system starts.
What’s Next
The expanded pipeline raises competition with Enbridge's Mainline and TC Energy's Keystone pipeline, which take Canadian crude to U.S. refineries.
Enbridge expects Trans Mountain's impact on its volumes to be modest.
($1 = 1.3494 Canadian dollars)
Related News
Related News

- Kinder Morgan Proposes 290-Mile Gas Pipeline Expansion Spanning Three States
- Enbridge Plans 86-Mile Pipeline Expansion, Bringing 850 Workers to Northern B.C.
- Intensity, Rainbow Energy to Build 344-Mile Gas Pipeline Across North Dakota
- Tallgrass to Build New Permian-to-Rockies Pipeline, Targets 2028 Startup with 2.4 Bcf Capacity
- U.S. Moves to Block Enterprise Products’ Exports to China Over Security Risk
- U.S. Pipeline Expansion to Add 99 Bcf/d, Mostly for LNG Export, Report Finds
- A Systematic Approach To Ensuring Pipeline Integrity
- 275-Mile Texas-to-Oklahoma Gas Pipeline Enters Open Season
- TC Energy’s North Baja Pipeline Expansion Brings Mexico Closer to LNG Exports
- Consumers Energy Begins 135-Mile Michigan Gas Pipeline Upgrade, Taps 600 Workers
Comments