Enbridge confident Line 3 pipeline will open this year

CALGARY Enbridge Inc. is confident that its Line 3 oil pipeline replacement project will come into service by the end of the year in spite of a renewed challenge launched this week by the newly elected governor of Minnesota.

On Tuesday, Gov. Tim Walz announced that his commerce department would petition the state Public Utility Commission to reconsider its approval of Line 3 through Minnesota, prolonging a process begun by his predecessor.

The $9-billion project to export crude from Alberta to Superior, Wis., where it will connect with pipelines to the U.S. Gulf Coast, is needed by shippers, supported by parties along its route and will create jobs and pay millions in taxes to local governments, said Enbridge CEO Al Monaco on a conference call on Friday. The project is designed to replace an aging pipeline and restore its original capacity of 760,000 barrels per day, an increase of about 370,000 bpd.

“Clearly, this pipeline is critical and it has massive support. With PUC approval, we’ve reached the final permitting and construction phase of the project,” said Monaco on the call to discuss fourth-quarter financial results.

“With regulators in all jurisdictions having now approved it, it’s full steam ahead on the remaining project execution phases.”

As long as permits are received in time to get construction crews into the field by June, the Calgary based company will be able to put the pipeline in service before the end of the year, said Guy Jarvis, president of liquids pipelines, on the call.

Previous challenges by the former governor were set aside by the state utilities commission.

A lack of export pipeline space was blamed for steep discounts in western Canadian oil prices last year, leading to production curtailments by the Alberta government that began Jan. 1.

Full oil and gas pipelines throughout its Canadian and U.S. network and the addition of new services led to fourth-quarter earnings that beat analyst expectations.