TransCanada Corp raises costs for its Keystone XL project up to C$8 billion

Canada’s second largest pipeline company, TransCanada Corp, has raised its estimated capital costs for its Keystone XL project from an initial projection of C$5.4 billion up to C$8 billion ($7.02 billion).

The company attributed the increased cost to lengthy delays. Its Keystone XL project has been subject to increasing controversy.

The project would transport up to 830,000 barrels per day of Alberta oil sands crude to the U.S. Gulf Coast. It has been waiting for an American presidential permit for over six years now, with environmental groups expressing complete opposition.

This could all change though, with Republicans about to make significant gains and have a possible majority after U.S. mid-term elections on Tuesday. This could be what TransCanada has been waiting for, as lawmakers may force Obama to make the decision.

Russ Girling, CEO of TransCanada, said that he is not able to predict what will happen after the elections concerning the Keystone XL project. However, he said that he hopes the decision will be made quickly.

He said:

“Suffice to say that we are supportive of any process that can help advance the decision on the project given that the environmental review is completed and at this point in time we are just sitting and waiting for someone to say go,”

The company has just filed for regulatory approval of its C$12 billion Energy East pipeline, which will transport 1.1 million bpd oil sands crude to refineries and export ports in Quebec and New Brunswick.

TransCanada reported better than expected third quarter profit, fueled by good earnings from its Mexican and Keystone pipelines. Revenue for the company increased by 11.2 percent to C$2.45 billion. Net income attributable to common shares fell to C$457 million.