Keystone Gulf Coast Pipeline Construction Continues to Lag

Construction of the Keystone Gulf Coast Pipeline is “slightly behind plan,” according to Genscape, following an Aug. 18 flyover to  assess construction progress. Based on its review, Genscape disputes  TransCanada’s Aug. 20 statement that “construction was over 90 percent  complete and that the pipe was expected to be in service by the end of this  year.”

Genscape says its conclusions are based on observations that revealed exposed pipe along the right of way along with uncompleted tank  capacity at Cushing.

“Genscape now estimates that Q1 2014 to be a more  realistic in-service date,”        according to a press release the company issued. Other  sources have estimated startup dates that are closer to the second half of 2014  based on the realities of getting line-fill, final permits, and other  operational requirements.

TransCanada declined to comment on the Genscape report,  but reiterated its previous guidance and in-service date.  The company told OPIS Wednesday that  construction on the line was over 90% complete and testing and commissioning  activities are underway.

“Testing and commissioning work will take place over the next few months and we continue to focus on bringing the pipeline into  service in late-2013,” spokesman Grady Semmens said in an email response.

Genscape says the bulk of the work remaining on the project is centered on the Cushing pumping station and along the pipeline right  of way. At the Cushing terminal, four of the seven newly constructed tanks have  been hydro-tested with a fifth tank currently being hydro-tested. However,  mixer installation and tank pipeline connections have yet to be completed for  any of the seven new tanks.

Genscape believes that completed tank capacity and associated connections are necessary for initial KGCP fill — KGCP being the  36-inch diameter line which will flow 485 miles from Cushing, Okla., to  Nederland, Texas.

Also Genscape pointed out that exposed pipe was observed near the Tupelo, Bryan, Delta and Lake Tyler facilities and crews were observed  working to connect pipelines along the route. Genscape did say that the  Cromwell, Bryan and Winnsboro pumping stations each have four pumps installed  and the pipeline infrastructure looks to be nearing completion.

KGCP will have an initial capacity of 700,000 b/d with an option to expand to

830,000 b/d and line-fill is approximately 3.2 million barrels. Genscape estimates it will take 40-60 days to fill the line.

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