Trans Mountain Expansion Pipeline Seeks to Boost Oil Export Capabilities
Trans Mountain, the Crown corporation behind the completed Trans Mountain expansion oil pipeline, is exploring two methods to enhance oil export capacity over a year after the project’s construction. Despite not operating at full capacity currently, the pipeline has been transporting oil from Edmonton to Vancouver since May 2024, running at 80-85% of its total capacity.
Originally scheduled for consideration in 2028, plans to increase pipeline capacity have been expedited due to rising oil production in Alberta. While the physical dimensions of the pipeline will remain unchanged, Trans Mountain is investigating the use of drag reducing agents and potentially constructing more robust pumping stations to facilitate increased oil transport.
Todd Stack, the CFO of Trans Mountain, disclosed that the implementation of drag reducing agents could potentially boost capacity by 5-10%, translating to an additional 50,000-85,000 barrels of oil daily at a relatively low cost. Conversely, enhancing pumping capabilities would require a more substantial investment of $3-4 billion, with a longer timeline for completion.
Funding for these optimization projects is anticipated to be covered through operational profits or additional debt, as stated by Stack. Approval from the federal government is essential before proceeding with these initiatives. The existing Trans Mountain pipeline has an overall capacity of 890,000 barrels and is set to return $1.25 billion to Ottawa by year-end.
The export terminal in Burnaby, B.C., designed for 34 tankers monthly, is currently operating below capacity at 23 vessels per month, loaded to only 70% due to limitations in Burrard Inlet’s depth. The Vancouver Fraser Port Authority is in the preliminary stages of dredging the inlet to accommodate fully loaded tankers.
The expansion of oilsands production in northern Alberta is driving oil production growth, with output expected to reach record levels in 2025. Various companies, including Cenovus, Suncor, and others, are focusing on smaller expansions and improvements rather than large-scale projects. Without optimization efforts by pipeline companies, export constraints from Western Canada could arise by mid-2027, according to industry analysts.
Trans Mountain and other pipeline companies are exploring enhancements to ensure sufficient export capacity for the next five years. With proposed improvements, the ability to export oil from Western Canada is expected to be sustained until 2030, according to Stack’s remarks at an energy conference in Calgary. By 2030, oilsands production is projected to grow by an additional 500,000 barrels per day, driven by new projects in the region.
The completion of the Trans Mountain expansion has significantly increased western Canadian crude oil export capacity and export capabilities to tidewater. Additionally, the pipeline has led to a notable reduction in Canada’s crude-by-rail exports. Recent data from Statistics Canada indicates a substantial increase in oil pipeline shipments from Alberta to British Columbia following the expansion of the Trans Mountain project.
