Keystone South won’t deliver oil before mid-January

TransCanada Corp. told shippers Thursday the Gulf Coast portion of its Keystone pipeline won’t be in service before mid-January, three days after it said in a letter to regulators that it anticipated beginning service on Jan. 3.

The Calgary-based pipeline company estimates it will begin taking receipts and delivering oil in mid-to-late January, a bulletin to shippers shows. Customers will receive a letter with the in-service date about 30 days before service begins.

The pipeline section will carry about 520,000 barrels of crude a day during its first year from Cushing, Okla., the delivery point for West Texas Intermediate crude futures on the New York Mercantile Exchange, to Port Arthur.

TransCanada had said in a Dec. 2 letter to the U.S. Federal Energy Regulatory Commission that it “anticipates that it will initiate transportation service to the new delivery point, at Port Arthur, on January 3.”

The company’s bulletin Thursday was “clarification to our customers as a result of some of the media stories that were published, and again — what we have said in this bulletin is consistent with what we have told them previously,” Shawn Howard, a TransCanada spokesman, said by e-mail.

“As you can appreciate, there are many moving parts to this process — completion of construction, testing, regulatory approvals, line fill and then the transition to operations,” he said.