The Covid-19 pandemic has inflicted increased construction costs and delay on Coastal GasLink, the conduit designed to supply the Royal Dutch Shell plc-led liquefied natural gas (LNG) export project underway in British Columbia (BC), according to TC Energy Corp.
“We expect project costs will increase significantly and the schedule will be delayed,” TC management said Thursday in its 2020 year-end statement. “Coastal GasLink will continue to mitigate these impacts to the extent possible.”
Provincial virus control restrictions on industrial labor forces, ordered at the end of December, foiled a TC forecast last November that the 670-kilometer (400-mile) line would be completed across northern BC in 2023 for C$6.6 billion ($5 billion).
A revised construction cost and schedule remain unknown as work is in progress. Design and permit issues arising along the route across high hills, deep valleys, mountain ranges, forests and muskeg swamps contribute to the uncertainty, TC noted.
The C$18 billion ($13.5 billion) LNG Canada export terminal project in Kitimat, BC, has reached a pandemic control agreement with provincial health authorities that enables the construction labor force to regain full strength.
Covid-19 countermeasures at Kitimat include rapid virus infection testing, around-the-clock health care and emergency response crews, work camp isolation wings, and a ban against departures from the construction site for community visits.
Work is underway on a parallel public health arrangement for full return of the Coastal GasLink labor force. Construction cost increases are to be incorporated into the pipeline’s natural gas delivery tolls, said TC.The Calgary firm also repeated that its first quarter 2021 accounts will include a charge for losses from canceling Keystone XL in January when the Biden administration revoked the construction permit granted by the Trump administration.
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