- Kinder Morgan's (NYSE:KMI) Trans Mountain pipeline expansion is getting more expensive, but the company says the economic case for the project remains strong.
- The head of KMI's Canadian division last month tossed out a tentative cost estimate of ~$6.8B - vs. the $5.4B estimate when the regulatory application was filed in December 2013 - but a Trans Mountain spokesperson tells Canadian Press that a more accurate figure will be made available once precise conditions attached to any federal permit are known; the National Energy Board already has announced 145 draft conditions, which KMI has said are achievable.
- The spokesperson says some changes to the project along the way could affect the final price, such as deciding to tunnel through Burnaby Mountain, thicker pipe and routing changes.
- Customers have the ability to back out of their contract to ship crude on the pipeline if the cost exceeds $6.8B or the regulatory approval is pushed past the end of 2017; the NEB is expected to make a recommendation to the federal cabinet by May.