Coastal GasLink Pipeline Project
We are currently focused on community, landowner, government and First Nations engagement as the Coastal GasLink pipeline project advances through the regulatory process with the B.C. Environmental Assessment Office and the CEAA. We expect to begin an NGTL open season to provide delivery service to Vanderhoof, B.C. on Coastal GasLink in second quarter 2013.
We are holding a 45-day binding open season from April to May 2013 to determine the demand for new natural gas supply options for the New England and Atlantic Canada markets. The results could support an increase in our capacity from 168 MMcf/d to between 300 MMcf/d and 350 MMcf/d. The project will require upstream expansion on the Canadian Mainline that will be subject to an assessment of the implications of the recent NEB decision on the Canadian Restructuring Proposal.
A variety of construction activities are underway on the Tamazunchale Extension and the project remains on schedule to meet the planned in-service date of first quarter 2014.
Gulf Coast Project
We are constructing a 36-inch pipeline from Cushing, Oklahoma to the U.S. Gulf Coast and expect to begin delivering crude oil to Port Arthur, Texas at the end of 2013. Construction is approximately 70 per cent complete and we estimate the total cost of the Cushing to Port Arthur facilities to be US$2.3 billion.
Construction of the 76 km (47 mile) Houston Lateral pipeline to transport crude oil to Houston refineries is expected to begin in mid 2013 and be complete by mid 2014 at a total cost of approximately US$300 million.
The Gulf Coast Project will have an initial capacity of up to 700,000 barrels per day.
Keystone XL Pipeline
In January 2013, the Governor of Nebraska approved our proposed re-route after the Nebraska Department of Environmental Quality issued its final evaluation report noting that construction and operation of Keystone XL is expected to have minimal environmental impacts in Nebraska.
On March 1, 2013, the U.S. Department of State (DOS) released its Draft Supplemental Environmental Impact Statement for the Keystone XL Pipeline. The impact statement reaffirmed that construction of the proposed pipeline from the U.S./Canada border in Montana to Steele City, Nebraska would not result in any significant impact to the environment. The DOS is in the process of reviewing comments on the impact statement that it received during a public comment period that ended on April 22, 2013. Once the DOS has completed its review, it is anticipated it will issue a Final Supplemental Environmental Impact Statement and then consult with other governmental agencies during a National Interest Determination period of up to 90 days, before making a decision on our Presidential Permit application.
Due to ongoing delays in the issuance of a Presidential Permit for Keystone XL, we now expect the pipeline to be in service in the second half of 2015 and, based on our pipeline construction experience, the US$5.3 billion cost estimate will increase depending on the timing of the permit. As of March 31, 2013, we had invested $1.8 billion in the project.
Energy East Pipeline
We announced in April 2013 that we are holding an open season to obtain firm commitments for a pipeline to transport crude oil from western receipt points to eastern Canadian markets. The open season, which follows a successful expression of interest phase and discussions with prospective shippers, began in April 2013 and closes in June 2013.
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