Exclusive: TransCanada toughens pipeline pressure limits for gassy crude

Fri Jan 31, 2014 8:29am EST
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By Nia Williams

CALGARY, Alberta (Reuters) - TransCanada Corp reduced the limits for vapor pressures on its main U.S. oil export pipeline this month, regulatory documents show, one of the clearest signs yet of growing concern over gas-infused crude.

The formal move to tighten technical specifications and mandate improved testing on its 590,000 barrel per day Keystone pipeline had been planned for some time, industry sources said. The change is focused on maintaining quality standards and is not specifically related to any safety issues.

However it comes at a time of intensifying public debate over the potential dangers of transporting certain types of oil following a series of train derailments and explosions involving tank cars carrying light crude oil, including the Lac-Megantic, Quebec, crash that killed 47 people.

While rail companies worry about safety, pipeline companies like TransCanada want to prevent overly gassy crudes from entering their system to avoid shipping the ultra-light components to refiners who have little use for the gas.

The North American oil industry is starting to address the issue of testing for and policing the presence in crude of organic compounds of low molecular weight such as methane, ethane or propane, known in the industry as "light ends."

Those concerns could become more prevalent as gas-rich shale production expands and diluent-blended Canadian crude output grows.

TransCanada declined to comment on the change, which was detailed in documents filed with the U.S. Federal Energy Regulatory Committee and Canada's National Energy Board.

Canadian pipeline peer Enbridge Inc is currently analyzing whether to change its vapor pressure testing method, a spokesman said. Kinder Morgan Energy Partners LP declined to comment on possible changes in its tariff.   Continued...

TransCanada President and CEO Russ Girling announces the start of oil delivery operations on the Gulf Coast Project, the southern leg of the company's Keystone system in Calgary, Alberta, January 22, 2014. REUTERS/Todd Korol