BISMARCK, N.D. -- TransCanada Corp. is reassessing whether oil producers in North Dakota and Montana are still interested in shipping crude through its long-delayed Keystone XL pipeline now that they have other new options for shipping their product, including the Dakota Access pipeline.
The Calgary-based company's announcement this month comes with the Keystone XL still needing approval of its proposed route through Nebraska and with the Dakota Access, which was designed to transport about half of North Dakota's oil production, expected to be fully operational by June.
TransCanada announced in 2011 that it had secured five-year contracts to move crude from the oilfields of North Dakota and Montana via a proposed 5-mile-long access pipeline. The $140 million project, designed to carry 100,000 barrels of crude daily from the rich Bakken and Three Forks formations, would meet with the Keystone XL in Baker, Mont.
Work on that access line was never started, and TransCanada spokesman Matthew John said the company plans to re-engage with prospective shippers "because of a lot of changes in the oil market."
John said the company also would be surveying Canadian shippers to firm up support for the entire Keystone XL.
"We are confident the project still has a need, absolutely," he said.
TransCanada first submitted its $8 billion Keystone XL project for review in late 2008. The company initially balked at allowing U.S. crude on the pipeline that's designed mainly to carry Canadian oil south but also passes through rich oil fields along the Montana-North Dakota border.
The company reversed its stance in 2010 under political pressure from officials in the two states. Montana's then-Gov. Brian Schweitzer had threatened to hold up Keystone XL's 280-mile route through his state if it did not agree to an "onramp." North Dakota's congressional delegation also pushed for access to the pipeline.
Ron Ness, president of the North Dakota Petroleum Council, said the state's oil producers likely still want the option of utilizing the Keystone XL.
Information for this article was contributed by Josh Funk of the Associated Press.
Business on 05/16/2017