TC Energy raises expected cost of Coastal GasLink project to $14.5 billion

TC Energy Corp. is raising its estimate for the cost of its Coastal GasLink project to $14.5 billion, up from an earlier estimate of $11.2 billion.

The company says the pipeline project continues to face material cost pressures including a challenging labour market and contractor underperformance and disputes as well as drought conditions and erosion and sediment control issues.

TC Energy says the new estimate excludes potential cost recoveries and incorporates contingencies for certain factors that may be beyond its control.

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The company is targeting mechanical completion of the project by the end of 2023, with commissioning and cleanup work continuing into 2024 and 2025.

However, it says a comprehensive cost and schedule risk analysis estimates that if construction extends well into 2024, it could add up to an additional $1.2 billion to the project’s cost.

TC Energy says its overall 2023 capital spending plan has also been revised to between $11.5 billion to $12.0 billion, compared with an earlier estimate of $9.5 billion.