TransCanada Corp. (TSX, NYSE: TRP) has decided to move forward with its proposed $12 billion Energy East Pipeline project, which will move 1.1 million barrels of crude per day from the western province of Alberta to New Brunswick, on the East coast.
The Calgary-based pipeline giant said Thursday it will join giant Irving Oil Ltd. to build a new deep-water export terminal off Saint John, N.B. with an estimated investment of $300 million.
The pipeline giant added it received “strong market support” during its open season process, during which interested producers were asked to make binding commitments for space on the pipeline, which still needs regulatory approval.
"We are very pleased with the outcome of the open season for the Energy East Pipeline held earlier this year and are excited to move forward with a major project that will bring many benefits across Canada," said Russ Girling, TransCanada's president and chief executive officer, said in a statement.
"This is an historic opportunity to connect the oil resources of Western Canada to the consumers of Eastern Canada, creating jobs, tax revenue and energy security for all Canadians for decades to come."
Joe Oliver, Canada’s natural resources minister, welcomed the TransCanada announcement on Energy East but said the federal government would also work to ensure pipelines are safe.
“Our government welcomes the prospect of transporting Canadian crude oil from Western Canada to consumers and refineries in Eastern Canada and ultimately to new markets abroad,” Oliver said in a statement.
The Irving Oil Ltd. refinery in Saint John is Canada’s largest and can process 300,000 barrels of oil per day. Saint John also has a deep-water port and a liquefied natural gas facility.
TransCanada operates a network of natural gas pipelines that covers over 68,500 kilometres and tap into virtually all key gas supply basins in North America. The firm is also developing one of North America’s largest oil delivery systems.
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