The cost of the Trans Mountain oil pipeline expansion (TMX) project has increased by 70% from CAD7.4bn (US$5.6bn) to CAD12.6bn (US$9.5bn) due to regulatory and court delays, rising costs of steel, land, work and security, and accommodations for indigenous group. A total of 13 committed shippers, comprising Suncor Energy and Canadian Natural Resources and refiner BP, will cover 22%-25% of the cost increase through higher tolls under 20-year long agreements. The state-owned project company Trans Mountain Corp has already spent CAD2.5bn (US$1.9bn) to acquire the project and to ensure its completion.
The TMX project would twin the existing Trans Mountain line, which transports approximately 300,000 bbl/d of crude oil and refined petroleum products from the oil sands deposits in Alberta to Vancouver (British Columbia) and to the Washington State (United States). The expansion would boost its transport capacity to 890,000 bbl/d and would increase crude tanker traffic off the Canadian west coast.
The project has aroused a fierce opposition. In September 2018, the project was rejected by the Canadian Federal court of appeal on grounds that the government had failed to consider the concerns of some First Nations. However, the Canadian National Energy Board (NEB) estimated in early 2019 that its completion was in the Canadian public interest and should be approved: in June 2019, the Federal government of Canada approved the construction of the project. Trans Mountain Corp. relaunched the construction of the pipeline in August 2019. Earlier in February 2020, the Federal Court of Appeal of Canada rejected a challenge to government approval of the project; four indigenous groups were contesting the approval decision, considering they were insufficiently consulted by the government of Canada. Parties have 60 days to file a petition in the Supreme Court of Canada. The TMX project is expected to be commissioned in December 2022.