December 18, 2014 / 5:49 PM / 4 years ago

UPDATE 1-Enbridge optimistic Line 4 pipeline to restart Thursday

(New throughout, adds trader comments, market reaction, details on differentials)

CALGARY, Alberta, Dec 18 (Reuters) - Enbridge Inc said its 796,000 barrel per day Line 4 pipeline, the largest carrying Canadian crude to the United States, could restart as early as Thursday afternoon after a 1,350-barrel spill a day earlier.

A quick restart will be welcome news for Canadian oil producers grappling with a steep slump in the price of U.S. crude.

A lengthy pipeline outage would leave crude backed up in Alberta, deepening the discount on Canadian grades and pushing the outright price of Canadian oil even lower.

Late on Wednesday, Enbridge said a leak from a valve spilled crude at its Regina, Saskatchewan, terminal site, prompting the company to shut down the heavy crude pipeline.

On Thursday morning Graham White, a spokesman for Canada’s largest pipeline operator, said regulatory personnel were on site at the terminal and Enbridge could begin its restart plan for the line if a valve is repaired as expected this morning.

“Assuming all activities go as planned, we are optimistic service can be restored sometime later this afternoon,” White said.

Line 4 runs from Edmonton, Alberta, to Superior, Wisconsin and is Canada’s biggest crude oil export pipeline.

Traders in Canada’s oil capital Calgary were mostly unruffled by the shutdown. They said fixing the valve should be fairly simple.

The Canadian crude market is outside the nearly three-week-long trading window between the first of the month and the day before pipeline nominations were due.

That, combined with the fact many traders are starting to take time off for the Christmas holidays, contributed to the lack of market reaction.

There was no trade taking place in the de facto Canadian heavy benchmark grade, Western Canada Select heavy blend for January delivery, according to Shorcan Energy brokers.

WCS settled at $16.50 per barrel below U.S. crude on Wednesday, which put the outright price of Canadian oil at just under $40 a barrel.

“When I first saw it (the spillage) I thought ‘this is all we need here’,” said one Calgary-based trader. “But a valve at the terminal...If there had to be a leak, this is a good spot for it to happen.” (Reporting by Scott Haggett and Nia Williams; Editing by David Gregorio)

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