A Canadian trade group has filed a protest against Enbridge Inc.’s proposal to convert its Mainline system to serve a limited number of customers.
“If approved, it will reduce market optionality for Canadian producers, transfer pricing power to downstream buyers, depress prices for upstream producers and impair the viability of future investment,” Explorers and Producers Association of Canada warned in its filing with the Canada Energy Regulator (CER).
The proposal has created a conflict between U.S. refiners that stand to gain from the conversion and Canadian producers, Natural Gas Intelligence reported. Mainline’s capacity is 3 million barrels of oil a day.
Enbridge filed its proposal with CER in December 2019. It would allow shippers on the 70-year-old pipeline system to contract for priority access on 90% of capacity with the company reserving 10% for shipments of spot or uncommitted volumes of crude. The tolling agreement now in place is set to expire on June 30, 2021.
Enbridge indicated in its filing that the new agreement would not go into effect until the Line 3 Replacement Project goes into service. The project recently received its final permit approval from a Minnesota agency.
Recommended Reading
Commentary: Maximizing the Opportunity for Energy Dominance
2024-12-18 - Energy produced in the U.S. already has a strong grip on global markets. But with the country on the cusp of a new regulatory environment, will the U.S. capitalize on the opportunity to maximize energy dominance?
Exclusive: Arbo Monitoring Courts, Congress Amid Energy Policy Shifts
2024-12-09 - Chip Moldenhauer, CEO and founder of energy analytics company Arbo, gives insight into regulatory impacts the energy sector should watch for entering 2025, in this Hart Energy Exclusive interview.
Analysts: DOE’s LNG Study Will Result in Few Policy Changes
2024-12-18 - However, the Department of Energy’s most recent report will likely be used in lawsuits against ongoing and future LNG export facilities.
Dell: Folly of the Forecast—Why DOE’s LNG Study Will Invariably Be Wrong
2025-01-07 - Kimmeridge’s Ben Dell says the Department of Energy’s premise that increased LNG exports will raise domestic natural gas prices ignores a market full of surprises.
Biden-Led EPA Rolls Out Methane Fee Targeting Oil, Gas Emitters
2024-11-12 - Companies violating the new Environmental Protection Agency rules will start paying penalties next year based on methane emissions reported in calendar year 2024.