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by Stockwatch Business Reporter

West Texas Intermediate crude for May delivery added $1.16 to $86.59 on the New York Merc, while Brent for June added $1.30 to $90.65, closing above $90 for the first time since October (all figures in this para U.S.). Western Canadian Select traded at a discount of $15.90 to WTI, down from a discount of $15.00. Natural gas for May lost seven cents to $1.77. The TSX energy index added 1.78 points to close at 297.84.

Canadian heavy oil producers perked up as Trans Mountain confirmed that in-service date for its eponymous pipeline expansion is less than a month away. "The commencement date for commercial operation of the expanded system will be May 1, 2024," declared Trans Mountain in an update yesterday on its website. This is the same date it gave the Canadian Energy Regulatory (CER) in a filing in February, and gave again in a separate filing today.

While the imminent opening is welcome news, there is nonetheless tension between Trans Mountain and several oil producers, reflecting cost overruns and the pipeline's rising tolls for shipping (usage). The project's cost has ballooned to $34-billion from a 2017 estimate of $7.4-billion. While nearly three-quarters of the cost overruns will be borne by Trans Mountain, the rest -- more than $9-billion -- is considered "uncapped costs," and will therefore increase shipping tolls in accordance with a formula that the shippers agreed to more than a decade ago. The rise in uncapped costs led Trans Mountain to seek regulatory approval last year to more than double the tolls. Since then, it has been in a dispute with shippers such as Suncor Energy Inc. (SU: $52.26) and Cenovus Energy Inc. (CVE: $28.62), which lately have begun calling on the CER to force Trans Mountain to explain itself.

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