Trans Mountain Expansion to Boost Canadian Oil Prices for ‘Years’

The recently completed Trans Mountain pipeline expansion is expected to provide a significant boost to Canadian oil prices, according to MEG Energy Corp. executive Erik Alson. The expansion, which was officially opened last week, gives Canadian oil shippers access to an additional 590,000 barrels-per-day of pipeline capacity and opens up new markets for oilsands product in Asia and along the U.S. Pacific Coast. MEG is one of the main beneficiaries of the Trans Mountain expansion, with 20,000 barrels per day of contracted capacity on the pipeline. Prices for Canadian heavy oil increased, and the WCS-WTI differential narrowed, in April in anticipation of the start-up of the pipeline expansion. Alson said Tuesday he expects that to be a long-term trend.

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