(Bloomberg) — A key pipeline linking Canada’s oil sands crude to U.S. markets could start shipping crude as early as next month.
Enbridge Inc.’s 760,0000 barrel-a-day Line 3 oil pipeline could start operating as soon as Sept. 15, bringing relief to Canadian oil sands producers who have had with limited access to export pipelines. The new Line 3 pipeline from Alberta to Wisconsin replaces an older line with less capacity, is as little as 30 to 60 days from completion, according to a notice sent to shippers.
Canada’s oil sands producers have struggled for years with a shortage of export conduits as projects to build new ones face increasing scrutiny from courts and regulators. U.S. President Joe Biden, on his first day in office, rescinded a permit for TC Energy Corp.’s Keystone XL pipeline that would have helped increase shipments of Canadian crude to the U.S. Gulf Coast.
“Enbridge has filed for a toll surcharges on the Line 3 replacement with the Canada Energy Regulator and Federal Energy Regulatory Commission, which could be effective as early as Sept. 15,” spokesperson Jesse Semko said in an emailed statement. “There will be a further filing to specify the specific in-service date shortly before the line goes into service once all necessary construction and commissioning activities are complete.”
Heavy Western Canadian Select crude for September delivery strengthened 20 cents to a $12.80 a barrel discount to benchmark West Texas Intermediate at 9:37 a.m. Calgary time, NE2 Group data show.
The pipeline would be the first new cross-border export project built between Canada and the U.S. in years. The line is scheduled to enter service with oil sands production exceeding the capacity of existing lines out of Western Canada, forcing some companies to ship crude by rail.
The Line 3 project has been fiercely opposed by some environmental and indigenous groups, who have staged protests this summer along the construction route. Enbridge spent years in court fights and regulatory battles to get the line built. The Trans Mountain expansion, another export pipeline under construction is British Columbia, is scheduled to enter service as early as 2022.
Enbridge shares rose 13 cents to $39.32 at 12:35 p.m. in New York.
More stories like this are available on bloomberg.com
Subscribe now to stay ahead with the most trusted business news source.
©2021 Bloomberg L.P.
