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The Trans Mountain pipeline expansion will cost about C$3.1 billion more than the Canadian government-owned company managing the project previously expected, bringing the total cost to C$34 billion, about 10 percent % higher than the most recent estimate, according to a filing Monday with the Canadian Energy Regulator.
The latest cost increase, due to construction difficulties, marks another setback for the project that was expected to cost C$5.4 billion when it was first estimated in 2013.
Trans Mountain said in the statement that the start of firm service contracts with shippers is May 1, a month later than the previous launch date, analysts at RBC Capital said.
The expansion will nearly triple the flow of crude from Alberta to Canada’s Pacific Coast to 890,000 bbl/day, but has been plagued by years of delays and cost overruns.
Potentially relevant stocks include: Canadian Natural Resources (NYSE:CNQ), Suncor Energy (SU), Cenovus Energy (CVE), MEG Energy (OTCPK:MEGEF).