UPDATE 2-Kinder Morgan boosts size of Canadian pipeline project
* Capacity raised to 890,000 bpd from 750,000
* Price tag climbs to $5.4 billion from $4.1 billion
* Project will increase Vancouver tanker traffic
By Jeffrey Jones
CALGARY, Alberta, Jan 10 (Reuters) - Kinder Morgan Energy Partners has boosted the size of a proposed expansion of its Canadian oil pipeline by almost a third to $5.4 billion after signing up more customers for the project aimed at carrying growing volumes of oil sands-derived crude to the Pacific Coast, it said on Thursday.
Kinder Morgan said it now hopes to expand its Trans Mountain Pipeline between Edmonton, Alberta, and Vancouver to 890,000 barrels per day, up from the previously proposed 750,000. It currently ships 300,000 bpd.
The move comes as Canadian oil producers clamor to reach new markets for their supply, which is getting slapped with deep price discounts because of limited pipeline capacity to glutted traditional markets such as the U.S. Midwest.
The issue, which the Alberta and Canadian governments have warned is starting to take a toll on the domestic economy, was brought into sharp focus again on Thursday when Enbridge Inc , the main mover of Canadian oil to the United States, was forced to limit shipments due to operational issues. That pressured prices further.
With its expansion project, Kinder Morgan wants to add an adjacent pipeline along the length of its current one, with much of the new capacity aimed at reaching Asian refineries via tanker. Continued...