Pipeline company TC Energy updates on dispute over Coastal GasLink pipeline to LNG Canada

Tuesday, 16 November 2021
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TC Energy, the leading North American pipeline company for oil and gas, said the Coastal GasLink pipeline for LNG Canada in British Columbia continued to increase significantly project costs and completion timetables compared with original schedules.

The costs and completion issues have arisen as a result of scope changes, previous permit delays compared to the original construction schedule and the impacts from Covid-19, including a BC provincial health order.

Coastal GasLink is in dispute with LNG Canada with respect to the recognition of certain costs and the impacts on project schedules.

“Coastal GasLink has sought and will continue to mitigate cost increases and schedule delays and expects incremental costs will be included in the final pipeline tolls, subject to certain conditions,” explained TC Energy.

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Construction of the Royal Dutch Shell-led LNG Canada project is 50-percent complete after beginning three ago at the site in Kitimat, 640 kilometres north of Vancouver.

Shell and its four partners, Mitsubishi Corp. of Japan, Malaysian energy company Petronas, Chinese major PetroChina and Korea Gas Corp., are investing C$40 billion (US$30.2Bln) to build the plant and associated facilities.

The initial two Trains will produce 14 million tonnes per annum of LNG. There is the possibility of expanding the facility to include up to four processing units in the future.

The engineering, procurement and construction contractors are JGC Corp of Japan and Fluor Corp. of the US.

TC Energy, based in Calgary, Alberta-based company reported on the Coastal GasLink pipeline as it also posted third-quarter net income of C$779 million (US$625), or C$0.80 per share, compared with net income of C$904 million, or C$0.96 per share, for the same period in 2020.

“During the first nine months of 2021, our diversified portfolio of essential energy infrastructure assets continued to perform very well and reliably meet North America's growing demand for energy,” said François Poirier, TC Energy’s President and Chief Executive.

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