Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Inside Kinder Morgan Inc (KMI): KM Canada – Enbridge Inc (USA) (ENB), Kinder Morgan Energy Partners LP (KMP)

And now on to the Trans Mountain expansion. As stated above, the current capacity is 300,000 barrels per day. Management was originally looking to increase that number to 750,000 bpd, but received so much interest during its open season, that the target is now an incredible 890,000 bpd. The new long-term customer commitments are signed by a veritable who’s who of oil sands producers. Kinder Morgan Energy Partners LP (NYSE:KMP) has submitted approval for its toll methodology to Canada’s National Energy Board and is expecting a decision by June.

Paperwork dominates the timeline for the project from now until the end of 2015, when all necessary regulatory approvals are expected. Construction should commence in 2016 and finish by the end of 2017.

This pipeline project is controversial only in that all oil sands pipeline projects seem controversial right now. However, there are a few advantages that Kinder Morgan Inc (NYSE:KMI) has with the Trans Mountain that may allow the project to actually be completed by its 2017 target date. Unlike Enbridge Inc (USA) (NYSE:ENB)‘s Northern Gateway project, which is completely new construction, the Trans Mountain line already exists. With the exception of one section of the line around Hinton, Alberta, that will divert from the original pipe, this is basically a very large twinning project. In fact, the Trans Mountain has already been expanded once, back in 2008. By and large, this project is familiar territory for Kinder Morgan.

The second advantage, given the political climate for pipeline projects, is that not very many people know about it, especially when compared to the Northern Gateway, which is known and reviled by seemingly everyone in British Columbia. A strong track record and a low profile should go a long way for this expansion.

Foolish takeaway
Though it makes the smallest contribution to the balance sheet of all the Kinder Morgan segments, KM Canada is incredibly important to the partnership. There is tremendous opportunity here for future growth, particularly with crude oil pipelines, and any growth in this segment will continue to diversify Kinder Morgan Inc (NYSE:KMI)’s revenue, which is exactly what we want to continue to see.

The article Inside Kinder Morgan: KM Canada originally appeared on Fool.com and is Aimee Duffy.

Fool contributor Aimee Duffy has no position in any stocks mentioned. Click here to see her holdings and a short bio. If you have the energy, check out what she’s keeping an eye on by following her on Twitter, where she goes by @TMFDuffy. The Motley Fool recommends Kinder Morgan. The Motley Fool owns shares of Kinder Morgan.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.