Genscape sees delay to TransCanada's Gulf Coast project
NEW YORK Aug 27 (Reuters) - Crude oil may not flow on the southern leg of TransCanada's Keystone XL pipeline in the United States until the first quarter of next year, later than the company expects, energy intelligence group Genscape said on Tuesday.
Earlier this month, TransCanada said the 700,000 barrel per day (bpd) line from oil storage hub Cushing, Oklahoma, to Nederland, Texas is 90 percent complete and the company is working to bring it online by the end of 2013.
"Genscape believes this estimate to be optimistic based on construction progress. Genscape now estimates Q1 2014 to be a more realistic in-service date," the group said in a statement.
Genscape monitors energy infrastructure through photography taken from overhead flights and remote sensors that detect activity at installations such as refineries.
From its Aug. 18 flight over the pipeline's path, Genscape said instillation work still needs to take place at Cushing, where TransCanada will have 2.25 million barrels of storage capacity.
"Four of the seven newly constructed tanks have hydrotested with a fifth tank currently hydrotesting," it said. "However, mixer installation and tank pipeline connections have yet to be completed for any of the seven new tanks."
TransCanada declined to comment on the Genscape report. Instead, it reiterated its Aug. 20 statement.
"We are over 90 per cent complete on construction and our testing and commissioning activities are also underway. Testing and commissioning work will take place over the next few months and we continue to focus on bringing the pipeline into service in late-2013," it said in Tuesday's statement.
The 485-mile (780-kilometer) pipeline would help move crude oil stored at Cushing to refineries on the Gulf Coast, easing a glut that reached a historical peak earlier this year and weighed on U.S. benchmark oil futures.
Stocks have depleted in recent weeks as other pipeline projects have come on stream and after a large Midwestern refinery restarted an overhauled unit, prompting higher demand for Cushing oil.
At 37 million barrels, crude oil inventories at the hub are at their lowest level since March 2012, but they are still far off record lows of 12 million barrels in April 2004, when the U.S. Energy Information Administration began collating Cushing stocks data.