Subject to regulatory approvals, TransCanada will proceed with an approximate 80 km pipeline extension – the Houston Lateral – from the proposed Keystone XL system to facilitate deliveries into the Houston refining market and increase the capacity of Keystone XL to 830,000 bbl/d of oil. The Keystone Pipeline System has now secured long-term firm contracts in excess of 1.1 MMbbl/d.

“This significant demand and additional long-term customer commitments confirm the continued strong shipper support of TransCanada and the need for Keystone XL to move forward,” said TransCanada President and Chief Executive Officer Russ Girling. “Proceeding with the extension of the Keystone XL system to Houston and increasing capacity on the pipeline system will further enhance the connection of a secure, growing and reliable supply of Canadian crude oil and domestic US crude oil with the largest refining market in North America while providing additional flexibility to our shippers.”

TransCanada says that the Keystone Houston Lateral facilities will more than double the US Gulf Coast refining market capacity directly accessible from the Keystone Pipeline System to over 4 MMbbl/d by providing access to the key refining market in the Houston area.

The Keystone Houston Lateral and capacity expansion are included in the original scope of the Keystone XL US Presidential Permit application process which received a final environmental impact statement in August 2011.

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Based on the US Department of State's announcement that further assessment of an alternative route for Keystone XL is needed in Nebraska to move forward with the National Interest Determination by the first quarter of 2013, Keystone XL including the Houston Lateral, is expected to be in service by the end of 2014 subject to regulatory approvals.