TransCanada sensitive to public and politicians’ concerns following devastating BP Gulf of Mexico oil spill and Enbridge leak

TransCanada withdrew its request to the Pipeline and Hazardous Materials Safety Administration (PHMSA) for a special permit that would have allowed the company to operate the proposed Keystone XL pipeline at a slightly higher pressure than current federal regulations for oil pipelines in the United States


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The move is evidence that the effects of the BP Gulf of Mexico Oil Spill and the recent Enbridge oil leak into the Kalamazoo River in Michigan are being felt across the oil and gas industry. Companies are for more sensitive to the concerns and objections of residents and politicians.

Regardless of the fact TransCanada planned to build the pipeline using stronger steel and additional safety conditions, the company recognized the needs to take more steps to assure the public and stakeholders that the parameters of the special permit would result in a safer pipeline.

The company plans to continue to establish an operating record which will demonstrate the strength and integrity of the Keystone Pipeline System.

According to a TransCanada press release, “After listening to concerns from the public and various political leaders, TransCanada made the decision to withdraw the permit application. The company will build Keystone XL using the as-proposed stronger steel but will operate it at a lower level of pressure, consistent with current U.S. regulations.”

About the Keystone XL pipeline project

The Keystone XL project received approval in March 2010 from both the South Dakota Public Utility Commission and the National Energy Board in Canada. Pending receipt of additional permits, construction is planned to begin in 2011.

When completed, the Keystone XL project will increase the commercial capacity of the overall Keystone Pipeline System from 590,000 barrels per day to approximately 1.1 million barrels per day. The $12 billion system is 83 percent subscribed with long-term, binding contracts that include commitments of 910,000 barrels per day for an average term of approximately 18 years.

Commercial operations of the first phase of the Keystone system began June 30. Construction of the extension from Steele City, Nebraska to Cushing, Oklahoma is one-third complete and the pipeline is expected to be operational in 2011.

Keystone XL is a planned 1,959-mile (3,134-kilometre), 36-inch crude oil pipeline stretching from Hardisty, Alberta and moving southeast through Saskatchewan, Montana, South Dakota and Nebraska. It will connect with a portion of the Keystone Pipeline that will be built through Kansas to Cushing, Oklahoma and facilitate take away capacity from U.S. hubs located on the pipeline. The pipeline will then continue on through Oklahoma to a delivery point near existing terminals in Nederland, Texas to serve the Port Arthur, Texas marketplace.

Source: TransCanada

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