TC Energy Finishes Major LNG Pipeline in Canada

TC Energy has finished the construction of the Coastal Gaslink pipeline along the 670-km route from Dawson Creek, B.C., to Kitimat, B.C., which will connect to Canada’s first LNG-producing facility.

Mechanical completion of the pipeline, which includes final documentation, engineering analysis, and testing, will be completed by the end of the year, according to the company.

The Coastal GasLink pipeline is one of two significant pipelines projected to become active in the next few months, the other being the Trans Mountain oil pipeline. Both are considered potentially revolutionary by Canada’s energy sector in terms of their ability to increase market access and allow oil and gas corporations to grow production.

Natural gas from western Canada will be transported by the Coastal GasLink pipeline to the LNG Canada processing and export facility, which is being developed in Kitimat by Shell. This will provide domestic natural gas drillers with access to new markets in Asia.

The project, which is co-owned by Shell, Petronas, PetroChina, and Mitsubishi, will begin with two liquefaction trains, each with a capacity of 6.5 million tons of LNG, with the possibility of adding another two trains. This will increase the plant’s total capacity in Kitimat, British Columbia, to up to 26 million tons annually.

There have been difficulties in completing the Coastal GasLink pipeline. During construction, a capital project that was initially estimated to cost $6.2 billion has experienced major budget overruns. According to TC Energy’s most recent project price tag estimate as of February, estimated project expenses increased to $11.2 billion initially and then to $14.5 billion most recently.

Unexpected construction concerns, such as issues involving erosion and sediment control, as well as growing labour expenses, have contributed to the higher prices.

Last year, Canada’s Prime Minister Justin Trudeau showed a lack of interest in such developments, stating during a meeting with Germany’s Olaf Scholz that there was no business case for Canadian LNG exports.

However, both the owners of LNG Canada and the German chancellor appear to have different perspectives. The first one has started construction, while the other stated this weekend during a visit to Nigeria that Germany is interested in sponsoring the country’s LNG export capacity development.