CALGARY, Alberta (Reuters) - A quintet of Canada’s largest oil sands producers has contributed money and signed shipping deals in support of Enbridge Inc’s (ENB.TO) Northern Gateway pipeline to the Pacific Coast, according to documents filed days before hearings into the contentious proposal are due to start.
Suncor Energy Inc (SU.TO), Cenovus Energy Inc (CVE.TO), Nexen Inc NXY.TO, Total SA (TOTF.PA) and MEG Energy Corp (MEG.TO) came forward on Wednesday for the first time with their interests in the C$5.5 billion ($5.42 billion) project in National Energy Board filings.
The companies did not disclose individual contributions or shipping commitments, but money from industry backers makes up about half of the C$200 million Enbridge seeks to amass to move the project through the regulatory stage, Enbridge spokesman Paul Stanway said
Until now, all but China’s Sinopec Corp (600028.SS), which is investing in Canadian oil sands projects, had kept quiet about their interests in the proposal to ship crude from Alberta across the Rocky Mountains to the West Coast.
“Obviously it’s an indication of support we’re getting from industry on this project,” Stanway said.
There are other backers that have yet to go public, he said.
The pipeline would move 525,000 barrels of Alberta crude a day to a port at Kitimat, British Columbia, where it could be shipped in large volumes on tankers to Asia for the first time.
It would also include an adjacent condensate pipeline to the oil sands region, where the light hydrocarbons would be blended with tar-like bitumen so it can flow more easily.
Public hearings are set to start in Kitimaat Village on the British Columbia coast on Tuesday and the regulatory process is currently expected to last through to the end of 2013.
Oil producers, with strong support of the Canadian government, want the project to go forward to diversify markets for growing supplies of the unconventional oil. The tar sands-derived crude currently trades at a discount due to a glut of heavy crude in the U.S. Midwest and at the Cushing, Oklahoma, storage hub.
The project took on more urgency late last year when Washington delayed making a decision on TransCanada Corp’s (TRP.TO) Keystone XL pipeline to Texas from Alberta.
However, Northern Gateway faces stiff opposition from environmentalists and some British Columbia native groups, who have said they do not want the pipeline to cross their lands despite Enbridge’s offer of equity stakes and community development money.
Suncor said in its document that the project would help support marketing efforts for its own planned oil sands production of 700,000 barrels a day by 2020, about twice its current volume.
“The Northern Gateway pipeline is a critical piece of infrastructure that will provide Canadian oil producers with diversified market access for their growing oil production,” it said.
Cenovus cited its target of increasing output to 500,000 barrels a day from 130,000 over the next decade. Total, the French oil major, said it aims to lift oil sands production to 200,000 bpd from 25,000 currently.
“For us, the important thing is access and we’re supportive of all the new pipeline projects that have the potential to move crude oil to international markets,” Cenovus spokeswoman Jessica Wilkinson said.
She declined to give the value of the company’s financial contribution to the project, as did Nexen spokeswoman Patti Lewis, who stressed it is still up to regulators to determine if Northern Gateway is in the public interest.
Editing by Rob Wilson and David Gregorio