Enbridge’s long-delayed Line 3 oil pipeline project to start up Oct. 1 By Reuters
© Reuters. FILE PHOTO: The Enbridge Line 3 pipeline is pictured in place to be buried near Park Rapids on the second day of the Treaty People Gathering, an organized protest of the Line 3 pipeline, built by Enbridge Energy, in Park Rapids, Minnesota, U.S., June 6, 2
By Nia Williams
CALGARY, Alberta (Reuters) -Enbridge Inc said on Wednesday its Line 3 pipeline replacement project will begin operating on Oct. 1, the first successful major expansion of Canadian crude export capacity in six years, clearing hurdles that other projects were unable to overcome.
After a series of other proposed pipelines including Keystone XL by TC Energy (NYSE.:), it is a welcome development for Canada’s energy sector.
Enbridge (NYSE.) will be able to increase its daily capacity by roughly double the $8.2billion project. The 1,765 km (1097 mile) long pipeline can carry 760,000 barrels.
Line 3, which was built in 1960, transports oil from Edmonton (Alberta) to U.S. Midwest refineries. However, it has been transporting less oil for many years due to corrosion and age. Environmental and Native American groups opposed the project, especially in Minnesota which was the final stage of expansion.
Construction in both the United States and Canada took more than seven years to finish, but the project succeeded where other projects have run aground because it was replacing an old line, rather than one starting from scratch, Leo Golden, Enbridge’s vice president of Line 3 Project Execution, told Reuters in an interview.
Golden stated that the project was safety-driven and focused on replacing aging infrastructure.
After already completed segments in Canada and North Dakota, the Minnesota Section of Line 3 will be the final section to go into service.
Golden stated that Enbridge would begin filling the line with crude oil on October 1st and will have full capacity for 760,000 barrels per hour in November. In October, Enbridge told shippers it would provide 620,000 bpd crude capacity.
According to him, the future would see more capacity being added through the optimization and expansion of existing pipelines. This view was shared by union leaders throughout the United States.
Phillip Wallace, a business representative of Pipeliners Union 798 who worked in Minnesota on this project, stated that “The maintenance industry, the lifeline for the oil and gasoline (pipeline industry) industry” was his view. Line 3 was the bad boy and needed to be replaced.
Canadian producers can be assured that their oil sands crude production will have easy access to U.S. market and international exports via U.S. Gulf Coast.
Line 3 marks the completion of Enbridge’s Alberta Clipper project in 2015, which was Canada’s first significant oil pipeline expansion. Enbridge also has optimized its Mainline system since 2019, adding approximately 150,000 bpd.
The Line 3 replacement project was first announced in 2014 but ran into fierce opposition from environmental groups and Native American tribes, particularly in Minnesota.
Environmental groups criticize Joe Biden of the United States for allowing Keystone XL to continue. These groups claim that the United States must reduce its dependence on fossil fuels for climate protection.
According to a Sierra Club spokeswoman Margaret Levin in a release, “President Biden, the rest of the politicians, who refused to comply with treaty rights, polluted waterways, and violent protesters were arrested have put themselves on the wrong side history.”
Trade unions were happy to celebrate the accomplishment. Their members gained thousands of new jobs and Canada’s energy industry, which has had its share of problems with pipe-line bottlenecks in the past, contributing to a drop in crude oil prices and an exodus from foreign capital.
Martin King of RBN Energy, an analyst stated that “this is a tremendous boost to the sector.” According to him, the projected growth of Canada’s oil-sands industry suggests that only one major expansion is needed. This will be Trans Mountain which the Canadian government owns. It will connect the west coast.
Robert Fitzmartyn (NYSE: Head of Energy Research at Stifel FirstEnergy) said that he expects Line 3 to be completed in a way that will have a long-term positive effect on Canadian oil companies shares.