TransCanada revises Keystone XL date
Company hikes cost estimate by $1B
Calgary-based TransCanada Corp. said Tuesday that approval of its controversial Keystone XL crude pipeline expansion will take longer than expected.
The energy company also raised its estimate for the project's cost by $1 billion.
It said it now expects U.S. authorities to approve the project in the last six months of 2011. Its previous estimate was for early in the year.
"The regulatory process conducted by the Department of State is continuing, within a heightened political environment and opposition to the project has been expressed," the company said in a statement.
If Keystone XL wins regulatory approval, TransCanada expects the massive Alberta-to-Texas line to start up some time in 2013.
The State Department has jurisdiction because the pipeline would cross the Canada-U.S. border. Canadian approvals are already in place.
The first phase, which delivers crude to refineries in the Midwest and a storage hub in Cushing, Okla., is already in operation.
The Keystone XL expansion would expand capacity by 500,000 barrels a day and extend the line to refineries along the U.S. Gulf Coast, a very lucrative market. The expansion would run directly from Alberta, connect with existing pipelines in Kansas and Oklahoma and extend to the Gulf.
The cost of the entire system had been pegged at $12 billion US, but TransCanada said Tuesday it is now expected to cost $13 billion US as a result of currency swings, evolving regulatory requirements and permitting delays.
Opposition to the massive project has been fierce, with environmentalists worried a spill could damage key drinking-water sources and increase U.S. reliance on "dirty" crude from the oilsands.
Earlier Tuesday, TransCanada said its fourth-quarter net income was $269 million, or 39 cents per share, a decline from $381 million, or 56 cents per share at the same time last year.
Revenues grew to $2.1 billion from $2 billion during the three-month period.
TransCanada also announced that it would boost its quarterly dividend to 42 cents per share from 40 cents, payable April 29.
With files from The Canadian Press