Delivering on its commitment to maximize the benefits of the Expansion Project for Canadians, today Trans Mountain announced it has come to an agreement with EVRAZ North America to supply about 250,000 metric tons of pipe, equal to approximately 800 kilometres of oil pipeline construction.
The deal, contingent upon Kinder Morgan's final investment decision, would see more than 75 per cent of the pipe needed for the Project coming from EVRAZ North America's Regina, Saskatchewan plant. The material for the pipe will be sourced from EVRAZ's recycled metal operations in Alberta, Saskatchewan, Manitoba and Ontario and the pipe will be manufactured by Canadian members of the United Steelworkers Union.
"It has been our commitment from day one to deliver benefits from this Project to Canadians, and we are pleased to announce the single largest potential procurement contract to a Canadian plant and Canadian workers," said Ian Anderson, President of Kinder Morgan Canada.
EVRAZ North America is the only producer of 100 per cent made in Canada pipe and currently employs over one thousand workers at the Regina site where Canadian members of the United Steelworkers have produced over 63,000 kilometres of pipe used in oil and gas pipelines since 1956.
"We look forward to working with Kinder Morgan on this Project. Our collective expertise will make this one of the most technically advanced and environmentally safe pipelines in the world," said Conrad Winkler, EVRAZ North America President and CEO.
The $7.4 billion expansion project will result in direct and lasting economic benefits to Canada and communities along the pipeline corridor, including the equivalent of 15,000 jobs per year during construction.
"The men and women of the United Steelworkers 5890 in Regina will be proud to produce the vast majority of the pipe for the Trans Mountain Expansion in Canada, for Canada," said Stephen Hunt, USW Director, Western Canada. "With decades of experience making high quality steel and pipe, we will make this the safest and most environmentally sound pipeline possible. Making this pipe means preserving and creating highly skilled, well-paying, middle class Canadian jobs."
Overall, the Conference Board of Canada estimates the Project will generate $46.7 billion in government revenues and 802,000 person years of employment, the equivalent of 37,000 jobs per year during operations.
The remainder of the pipe needed, as well as other procurement contracts, will be announced as Project planning proceeds. Next steps for the Project include arranging acceptable financing and a final investment decision by Kinder Morgan. Construction is set to begin in Fall 2017 and the Project is expecting an in-service date of late 2019.