Coastal GasLink Project Will Receive More Budget Than Expected by TC Energy

TC Energy Corp. expects to go “significantly” over its initial budget on the completion of its Coastal GasLink pipeline project. On Tuesday, the company stated that they anticipate the project to be completed before LNG Canada’s export terminal at Kitimat, B.C.

LNG Canada chose TC Energy back in 2011 to design, develop, own, and operate Coastal GasLink. With its construction starting in 2019, there were original plans to finish construction in 2023. 

In its fourth-quarter financial report, TC Energy claimed the pipeline was around 60% complete. 2.1 billion cubic feet per day (bcf/d) of natural gas will be transported across 670 kms to LNG Canada’s terminal, where it will be liquefied and exported to global markets.

Bevin Wirzba, head of corporate development, revealed on a conference call with analysts that the company and LNG Canada are still at odds about predicted price increases and schedule issues. Permit delays and the effects of COVID-19 have been attributed by the corporation in the past.

He refused to put a dollar estimate on the project’s cost overrun, but TC Energy is currently engaging in “constructive dialogue” with LNG Canada to address the issue, according to Wirzba. Construction will not be put on hold while negotiations are taking place, he said.

“What is really clear to us is that the fundamentals that underpin the need for Coastal GasLink and the LNG Canada facility (and) the needs for those projects have never been more robust,” said Wirzba.

“Our shared objective with our customers is to deliver the pipeline safely and get it ahead of the LNG plant that’s being constructed right now.”

TC Energy has agreed to provide up to $3.3 billion in additional temporary bridge financing for the Coastal GasLink pipeline project in the event of cost overruns. On Tuesday, TC Energy also increased its dividend with a fourth-quarter profit of $1.1 billion.

Original source material for this article taken from here