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For Canada, TMX is a License to Fill

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Unshackled at last, producers in Western Canada plan to raise crude oil output in anticipation of the new Trans Mountain Pipeline expansion (TMX). In the Crude Hub Model, East Daley Analytics expects producers will fill the new egress capacity to British Columbia by mid-2026.

After several years of delay, Trans Mountain plans to begin commercial operations on the expansion in May. TMX will twin the existing Trans Mountain pipeline, adding 590 Mb/d of capacity from Alberta to the Westport Terminal in Burnaby, BC. Owned by the Canadian federal government, Trans Mountain expects to begin filling the new pipeline in April.

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EDA anticipates a big shift ahead in pipeline flows as TMX frees up capacity on Enbridge’s Mainline to the Midwest. For producers in the Western Canadian Sedimentary Basin (WCSB), the new market access has spawned expansion plans. Most of the growth will come from the oil sands, specifically in-situ recovery where bitumen is heated and pumped out of the ground. Based on company announcements, we expect the lion’s share of growth in Western Canada to begin in 2H24 and continue through 2025.

In the Crude Hub Model, EDA forecasts Canadian oil production to grow ~45 Mb/d (1%) by YE24, ramping to growth of ~200 Mb/d (4%) by YE25. The figure shows WCSB oil production and associated condensates (produced + imports) blended into the bitumen to facilitate oil flows. The graph does not account for rail volumes, which will increase once shippers fill available pipeline capacity.

Virtually all of Western Canada’s largest operators have announced plans to expend and fill the long-awaited pipeline project. Canadian Natural Resources (CNQ) is developing five in-situ projects in the oil sands, one to come online in 2024 and four to start in 2025. Cenovus (CVE) has six in-situ projects approved in the Athabasca oil sands. CVE plans to start one project in 2024, three in 2025, and two more in 2026.

Overall, the Alberta Energy Regulator has approved at least 44 projects in the oils sands, including four in the oil sand mines, 36 in the Athabasca oil sands region, and four in the Cold Lake oil sands region. – Kristy Oleszek Tickers: CNQ, CVE, ENB.


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