Canadian regulator approves Enbridge Line 3 with conditions

Mon Apr 25, 2016 5:48pm EDT
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By Nia Williams

CALGARY, Alberta (Reuters) - Canadian regulators on Monday recommended the federal government approve Enbridge Inc's plan to replace one of its major crude oil export pipelines, but also imposed 89 conditions on the project to enhance safety and environmental protection.

Calgary-based Enbridge plans to replace all segments of pipe on the 1,031 mile (1,659km) Line 3 between Hardisty, Alberta, and Superior, Wisconsin, by 2019, in what will be the company's largest-ever project. The cross-border endeavor will cost more than C$7.5 billion ($5.91 billion).

Monday's recommendation only applies to the Canadian section of the line. U.S. regulators are in the process of dealing with the southern leg.

In a statement Enbridge said it was pleased with the regulator's announcement and was in the process of reviewing the 89 conditions.

Despite being a cross-border project, Line 3 will not require a U.S. presidential permit, which ultimately scuppered TransCanada Corp's Keystone XL, because Enbridge is restoring the pipeline to its original capacity.

President Barack Obama rejected Keystone XL last November after a seven-year delay, and other proposed export pipelines from Alberta's oil sands to the Canadian east and west coasts are also facing additional regulatory scrutiny.

The Line 3 project will allow Enbridge to run the pipeline at maximum capacity of 760,000 barrels per day. Currently capacity is 390,000 bpd because of voluntary pressure restrictions.

Dr Robert Steedman, chief environmental officer at the National Energy Board, said a regulatory panel had concluded the project was in the public interest and unlikely to cause significant adverse environmental affects.   Continued...

Al Monaco, President and CEO, Enbridge, stands when introduced during the Enbridge Income Fund annual general meeting for shareholders in Toronto May 6, 2015.  REUTERS/Peter Power