U.S. oil just 8% of pipeline's daily haul, TransCanada tells State Dept.

U.S. oil would constitute less than 8 percent of Keystone XL's daily crude haul under current contract conditions that also leave as much as 32 percent of its capacity open, the project's sponsor disclosed today in comments to the State Department.

TransCanada Corp.'s confirmation of how much space remains open on its proposed pipeline is tucked into a 35-page document that marks a closing argument of sorts in its years-long push to win a border-crossing permit for the $5.4 billion link between the Canadian oil sands and U.S. refineries. State is in the midst of an open-ended national interest determination period on KXL that gives other federal agencies, such as U.S. EPA, until early May to weigh in.

The company "currently has firm, long-term contracts to transport in excess of 500,000" barrels per day (bpd) of western Canadian crude to the Gulf Coast, TransCanada wrote. An on-ramp for light U.S. oil located near the booming Bakken Shale play is currently contracted to carry 65,000 bpd of a possible 100,000-bpd maximum, TransCanada added.

That Bakken crude level -- less than 8 percent of the pipeline's total daily capacity -- is unchanged since State finished its draft environmental review of KXL one year ago. Soon after that disclosure, the Canadian natural resources minister used the phrases "at least 20 percent" and "up to 30 percent" to describe the project's space for U.S. oil (Greenwire, Aug. 27, 2013).

More than half of KXL's potential space for Bakken crude is reportedly reserved by Continental Resources Inc., the shale oil giant whose CEO struck a pessimistic note earlier this year when asked whether he expects the pipeline to win a permit from President Obama (E&ENews PM, Jan. 30).


Any still-uncommitted capacity on KXL is not required to sit idle if the pipeline is approved and built. The Federal Energy Regulatory Commission allows pipeline operators such as TransCanada to offer higher "uncommitted" tariff rates for oil companies seeking less firm agreements to ship crude south.

As State continues its national interest review of the pipeline, greens who lambaste its emissions-heavy oil sands crude as devastating for climate change are planning a fresh round of public protests in front of the White House next month. After the arrest of hundreds of college students in a protest nine days ago, a group of American Indians and Plains-state ranchers operating as the Cowboy and Indian Alliance plan to ride into the capital on horseback on Earth Day to highlight their opposition to KXL.

Click here to read TransCanada's comments on the pipeline's national interest importance.

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