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Providing coverage of Alaska and northern Canada's oil and gas industry
July 2010

Vol. 15, No. 27 Week of July 04, 2010

TransCanada’s Keystone Pipeline begins oil delivery to US Midwest

TransCanada Corp. said June 30 that line fill of the first phase of the US$12 billion Keystone Pipeline is complete and commercial deliveries of crude oil to U.S. Midwest markets at Wood River and Patoka, Ill., would begin that same day.

“Looking forward, Keystone will play an important role in linking a secure and growing supply of Canadian crude oil with the largest refining markets in the United States, significantly improving North American energy security,” Hal Kvisle, TransCanada president and CEO, said in a statement, calling the beginning of commercial deliveries a “a significant milestone” in the development of Keystone.

In Canada the first phase of Keystone involved conversion of some 537 miles of existing natural gas pipeline in Saskatchewan and Manitoba to crude oil pipeline service. The Canadian portion also included some 232 miles of new 30-inch diameter pipeline, 16 pump stations and the Keystone Hardisty Terminal.

In the U.S. 1,084 miles of new 30-inch diameter pipe were installed in North Dakota, South Dakota, Nebraska, Kansas, Missouri and Illinois. Twenty-three pump stations and delivery facilities at Wood River and Patoka were also constructed.

TransCanada has begun construction of the second phase of Keystone — a 298-mile extension from Steele City, Neb., to Cushing, Okla., and 11 new pump stations which will increase the capacity of the line from 435,000 barrels per day to 591,000 bpd.

In-service date for the second phase of Keystone is the first quarter of 2011.

Gulf expansion

TransCanada said in July 2008 that it would expand the Keystone system and provide additional capacity of 500,000 bpd from Western Canada to the U.S. Gulf Coast.

The National Energy Board in Canada and the South Dakota Public Utility Commission approved the proposed Gulf Coast expansion in March.

TransCanada said construction of the Gulf Coast expansion is expected to begin in the first quarter of 2011, pending receipt of regulatory approvals.

The Keystone Gulf Coast expansion project is a 1,661-mile, 36-inch crude oil pipeline from Hardesty, Alberta, through Saskatchewan, Montana, South Dakota and Nebraska.

The Gulf Coast expansion would incorporate the portion of the Keystone Pipeline currently under construction through Kansas to Cushing. The line would continue through Oklahoma and Texas to a delivery point near existing terminals on the Gulf Coast, serving the Port Arthur, Texas, marketplace.

When completed the Gulf Coast expansion will increase the commercial capacity of the Keystone Pipeline system to approximately 1.1 million bpd.

—Petroleum News






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