Keystone Pipeline Project Moving Toward Completion

Construction on TransCanada Corporation’s long-distance, large-diameter C$5.2 billion Keystone crude oil pipeline reaching from Canada’s Alberta oil fields to markets in the U.S. Midwest is grinding to completion after more than two years of intensive construction activity.

The Keystone construction scope involved building a 2,148-mile, 30- and 36-inch pipeline to transport up to 590,000 bpd from the terminal and storage facilities at Hardisty, Alberta to markets at Wood River and Patoka, IL and on to Cushing, OK.

Mobilization of equipment and services, including construction, for the project started in 2008. Site of first construction was in North Dakota at the U.S.-Canadian border in May 2008 with Canadian construction getting under way during June 2008. Completion on the pipeline section to Cushing is scheduled for the fourth quarter of 2010.

Although Keystone is several months from completion, TransCanada has started filling completed sections of the pipeline system.

Here is a quick tale-of-the tape for the Keystone project:

• Total length is 2,148 miles.
• 1,379 total miles of new pipeline was built in the U.S., including 1,084 miles of the U.S. mainline from the U.S.-Canadian border to markets in Wood River and Patoka as Phase I and 295 miles from Nebraska to Cushing as Phase II.
• The Canadian portion included construction of 232 miles of pipeline and the conversion of 537 miles of existing TransCanada pipeline from natural gas to crude oil transmission.
• The new line has a 30-inch outer diameter to Illinois and increases to 36 inches from Nebraska and Kansas to Cushing.
• The pipeline was buried with a minimum depth of cover of four feet, depending on land use.
• Initial nominal capacity is 435,000 bpd with the capability of increasing capacity to 590,000 bpd.
• Estimated operating pressure for the new pipeline sections is 1,440 psi. The converted section will operate at its current approved allowable operating pressure of 880 psig.

Originally, the Keystone system was a partnership between TransCanada and ConocoPhillips. However, TransCanada became the lone owner and operator in June 2009 through a purchase transaction.

Contracts
In the U.S., UniversalPegasus International and Trow Engineering Consultants were contracted to handle design, engineering and construction management for the project. UniversalPegasus also provided inspection services while Trow also handled an environmental inspection this year. Construction contracts were awarded to Henkels & McCoy, Inc., Michels Corp., Price Gregory International and Sheehan Pipe Line Construction Co.

Henkels & McCoy, Inc. was assigned Spread 1, which consisted of laying 130 miles of 30-inch pipe from the U.S.-Canadian border to a point in Barnes County ND. Michels handled Spreads 2 and 3, consisting of 275 miles of 30-inch. Spread 2 picked up where the first spread left off and ran to a point in Day County, SD. Spread 3 extended into Hutchinson County, SD.

Price Gregory was contracted for Spreads 4 through 7, and Sheehan built Spread 8. This work extended from Hutchinson Country, SD through Nebraska and Missouri to Wood River and Patoka. The 295 miles of Phase II (Spreads 9, 10 and 11) extend from Illinois through Nebraska and Kansas to Cushing, OK. Price Gregory worked on Spreads 9 and 11 and Sheehan worked on Spread 10.