CALGARY -- It's more vital than ever that three other pipelines to oil export markets proceed as planned in the wake of TransCanada Corp. (TSX:TRP) shelving its Energy East pipeline on Thursday, says AltaCorp Capital analyst Dirk Lever.

Lever says Canadian producers will have to transport any incremental new oil production over the next year or so using railcars, and the pipeline transportation system out of Western Canada will remain tight for years.

"We already know the next incremental barrel of production has got to go by rail because the pipelines are effectively full," he said Friday.

In a report in July, RBC Capital Markets predicted oilsands production would grow by 900,000 barrels per day in the next five years thanks to startup of Suncor Energy Inc.'s (TSX:SU) 194,000-bpd Fort Hills mine and several smaller projects, including an 80,000-bpd expansion at Canadian Natural Resources Ltd.'s (TSX:CNQ) Horizon mine and upgrader.

It pointed out that about three-quarters of the new bitumen production is not going to be upgraded, which means it will have to be diluted to create a product composed of 30 to 40 per cent lighter petroleum in order to flow in a pipeline. That will increase the demand for pipeline volumes beyond what is required for the heavy oil alone, it said.

Opponents of pipeline projects who look at the oil forecasts and conclude they aren't needed sometimes overlook the diluent component of shipping bitumen, said Tim McMillan, CEO of the Canadian Association of Petroleum Producers.

"We will exceed our current and projected pipeline capacity by 2030 with (Energy East) gone ... not just on a strategic level but by volume," he said.

Lever said Energy East could come off the shelf and be proposed again for regulatory approval if any of the other pipelines don't go ahead or if market conditions change to encourage higher production growth.

"Energy East was more than what was needed," he said of the proposal to ship 1.1 million bpd from Alberta to New Brunswick.

"Producers weren't going to pay for that much excess capacity so I'm not surprised it fell to the wayside. If one of those (other pipelines) falls away, then Energy East would be needed."

He said the next capacity increase is expected to come with Enbridge Inc.'s (TSX:ENB) Line 3 pipeline replacement project, which is under construction in Canada and awaiting its last U.S. regulatory approvals in Minnesota. It is expected to add 370,000 bpd of capacity by early 2019.

But that additional room will only just accommodate new output from oilsands expansions and the situation will remain tight until the Trans Mountain expansion pipeline to the West Coast proposed by Kinder Morgan is in service, expected to add 590,000 bpd by late 2019, Lever said. That project is being actively opposed in court by the B.C. government and other intervenors.

TransCanada hasn't yet approved its Keystone XL pipeline into the U.S. but Lever said its 830,000-bpd capacity would likely provide enough room for Canadian oil production growth until about 2030, when the industry expects Canadian production to reach five million barrels per day.

Lever pointed out that having excess pipeline capacity is important because it gives producers options to supply different markets and offers the pipeline operators flexibility to schedule maintenance downtime.