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Enbridge signs tolling deal with shippers for Mainline pipeline system

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Enbridge Inc. says it has reached a deal with shippers for tolling on its Mainline pipeline system, which moves over three million barrels a day of crude oil and liquids from Western Canada. This photo taken in October 2016 shows an aboveground section of Enbridge’s Line 5 at the Mackinaw City, Mich., pump station. THE CANADIAN PRESS/AP-John Flesher

Calgary

Enbridge Inc. says it has reached a deal with shippers for tolling on its Mainline pipeline system, which moves over three million barrels a day of crude oil and liquids from Western Canada.

The announcement Thursday is a major milestone for the Calgary-based pipeline company, which has been negotiating with oil shippers on a new tolling agreement ever since its proposal to fill Canada’s largest oil pipeline network through long-term contracts was rejected by the Canada Energy Regulator in November 2021.

Enbridge CEO Greg Ebel said the settlement has been approved by the company’s board of directors and received “overwhelming support” from a 37-member industry stakeholder group that included producers, refiners, integrated companies, industry agencies, and governments.

“This settlement is a win-win-win – customers will continue to receive competitive and responsive service; Enbridge will earn attractive risk-adjusted returns; and the Mainline will continue to feed North America and global markets with a long-term source of safe, secure, and affordable energy,” Ebel said in a release.

Enbridge’s Mainline is Canada’s largest oil pipeline system, providing about 70 per cent of the total oil pipeline transportation capacity out of Western Canada.

The pipeline’s demand has exceeded capacity over the past few years, so Enbridge had applied to enter into long-term contracts for 90 per cent of the Mainline system’s capacity.

Enbridge had argued firm contracts would give customers more predictable access to the pipeline, but some Canadian oil producers argued the proposed change would worsen the existing capacity constraints and could lead to lower oil prices.

In rejecting the proposal in 2021, the Canada Energy Regulator concluded Enbridge’s proposal would dramatically change access to the pipeline. It said certain companies would benefit from long-term stability, but others would lose access to the pipeline.

Enbridge said Thursday the new settlement covers both the Canadian and U.S. portions of the Mainline system and will provide customers with a stable, competitive toll relative to competing alternatives.

The agreement also includes a financial performance collar providing incentives for Enbridge to optimize throughput and cost, but also providing downside protection in the event of extreme supply or demand disruptions.

Enbridge said it expects to jointly finalize the settlement with industry and submit an application for approval to the Canada Energy Regulator in the third quarter.

It expects the new tolling settlement could be approved and implemented later this year. The settlement term is seven-and-a-half years, lasting through 2028.

This report by The Canadian Press was first published May 4, 2023.

Companies in this story: (TSX:ENB)

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Carney’s Honeymoon Phase Enters a ‘Make-or-Break’ Week

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From the National Citizens Coalition 

The National Citizens Coalition (NCC) is sounding the alarm on a critical week for the Carney government, which, despite enjoying an unearned honeymoon in the polls, has delivered zero results for everyday Canadians. As the G7 summit looms large and the House of Commons prepares to adjourn, this is a make-or-break moment for Prime Minister Mark Carney to prove his government is more than empty promises. Canadians are watching, and the NCC is calling out the glaring failures that threaten a grim summer of economic decline, and continued crime, chaos, and rising unemployment.

Housing Minister Gregor Robertson Caught in $10.85 Million Scandal

Recent revelations from Blacklock’s Reporter expose Housing Minister Gregor Robertson’s attempt to conceal $10.85 million in personal property investments during Commons questioning. This shocking lack of transparency from the minister tasked with addressing Canada’s housing crisis raises serious questions about his integrity and ability to prioritize Canadians struggling with skyrocketing costs. While Robertson dodges accountability, and Carney apparently scoffs at providing housing relief to millions suffering under a Liberal-made crisis, young professionals and young families are wondering if they’ll ever have a chance to own a home bigger than Canada’s much-maligned supply of ‘dog-crate condos.’

The NCC demands a full ethics investigation, the resignation of Gregor Robertson — who, as one of the architects of the Vancouver housing crisis, should have never been handed this file to begin with — and immediate action to restore trust in this critical portfolio.

Pipeline Delays and Provincial Obstruction Threaten Economic Growth

The Carney government’s inaction on pipelines is stalling Canada’s economic potential. Despite promises of “nation-building projects,” British Columbia and Quebec continue to block and veto critical energy infrastructure, with Carney failing to assert federal leadership. His vague talk of “consensus” and “decarbonized” barrels has led to zero progress, leaving Alberta’s economy in limbo and Canadians facing higher energy costs. With no clear plan to advance projects, the government is squandering opportunities to create jobs and secure energy sovereignty. The NCC urges Carney to act decisively this week to break the provincial logjam and deliver results.

Immigration Chaos: Lena Diab’s Unchecked Honour System Fails Canadians

Immigration Minister Lena Diab’s reliance on an ‘honour system’ for millions of temporary visitors with expiring visas is a recipe for disaster. As Canada grapples with unsustainable immigration levels, Diab’s apparent plan for millions of temporary workers and failed ‘diploma mill’ attendees assumes compliance without enforcement, ignoring the high-propensity for fraud, and the ongoing and urgent strain on housing, healthcare, and public services. The Liberals’ Strong Borders Act promises reform, but its loaded with unnecessary overreach and vague measures.

A lack of urgency leaves Canadians vulnerable to further crime, chaos, closed emergency rooms, high rents, and failing infrastructure. With immigration continuing to spiral out of control, the NCC calls for concrete action to drastically lower immigration targets, expedite deportations, and prioritize Canadian citizens and the record amounts of unemployed before the House adjourns.

Canadians Deserve Results, Not More Hollow “Elbows up” or “Team Canada” Rhetoric

This week’s G7 summit in Alberta and the impending House adjournment are the Carney government’s last chance to show leadership, before an undeserved summer break for a government that will be overseeing deepening economic decline, rising crime under a refusal to tackle catch-and-release bail, and growing unemployment. Canadians cannot afford another season of unfulfilled promises and unchecked crises. The NCC demands Carney use the G7 platform to secure trade stability, meaningful energy deals with our allies, and table a federal budget to address the cost-of-living crisis made worse by inflationary Liberal spending. Failure to act now will cement an early legacy of inaction and leave Canadians to endure a prolonged period of hardship.

“The Carney government’s honeymoon has been built on hype, not results,” says NCC Director Alexander Brown. “From Gregor Robertson’s hidden millions, to stalled pipelines, to an immigration system in continued disarray, Canadians — and particularly young Canadians — are being let down. This week is Carney’s chance to prove he can deliver beyond the lies that were told to placate a portion of the electorate at the polls. If he fails to act, the economic decline, the crime and chaos, will only worsen, and everyday Canadians will pay the price.

“True Canadian leaders like Alberta Premier Danielle Smith are in attendance at the G7 along with Carney. If actual acts of ‘nation-building,’ and not more net-zero de-growth, do not come naturally to the PM, he should turn to those who have never wavered in their quest to make life more affordable for the hard-working citizens they are privileged to represent, and who know when to get out of the way to allow Canadians to prosper. More of the same internal, ideological sabotage from the Liberals cannot ruin this dire moment for Canada’s rebirth and recovery.”

The NCC calls on all Canadians to hold the Carney government accountable. Join us in demanding transparency, action, and results before the House adjourns and the G7 summit concludes. Together, we can fight for a stronger, more prosperous Canada.

About the National Citizens Coalition: Founded in 1967, the NCC is a non-profit organization dedicated to advocating for individual freedom, lower taxes, less government waste, and a stronger Canada. We hold governments accountable and fight for the interests of everyday Canadians.

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Kananaskis G7 meeting the right setting for U.S. and Canada to reassert energy ties

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Energy security, resilience and affordability have long been protected by a continentally integrated energy sector.

The G7 summit in Kananaskis, Alberta, offers a key platform to reassert how North American energy cooperation has made the U.S. and Canada stronger, according to a joint statement from The Heritage Foundation, the foremost American conservative think tank, and MEI, a pan-Canadian research and educational policy organization.

“Energy cooperation between Canada, Mexico and the United States is vital for the Western World’s energy security,” says Diana Furchtgott-Roth, director of the Center for Energy, Climate and Environment and the Herbert and Joyce Morgan Fellow at the Heritage Foundation, and one of America’s most prominent energy experts. “Both President Trump and Prime Minister Carney share energy as a key priority for their respective administrations.

She added, “The G7 should embrace energy abundance by cooperating and committing to a rapid expansion of energy infrastructure. Members should commit to streamlined permitting, including a one-stop shop permitting and environmental review process, to unleash the capital investment necessary to make energy abundance a reality.”

North America’s energy industry is continentally integrated, benefitting from a blend of U.S. light crude oil and Mexican and Canadian heavy crude oil that keeps the continent’s refineries running smoothly.

Each day, Canada exports 2.8 million barrels of oil to the United States.

These get refined into gasoline, diesel and other higher value-added products that furnish the U.S. market with reliable and affordable energy, as well as exported to other countries, including some 780,000 barrels per day of finished products that get exported to Canada and 1.08 million barrels per day to Mexico.

A similar situation occurs with natural gas, where Canada ships 8.7 billion cubic feet of natural gas per day to the United States through a continental network of pipelines.

This gets consumed by U.S. households, as well as transformed into liquefied natural gas products, of which the United States exports 11.5 billion cubic feet per day, mostly from ports in Louisiana, Texas and Maryland.

“The abundance and complementarity of Canada and the United States’ energy resources have made both nations more prosperous and more secure in their supply,” says Daniel Dufort, president and CEO of the MEI. “Both countries stand to reduce dependence on Chinese and Russian energy by expanding their pipeline networks – the United States to the East and Canada to the West – to supply their European and Asian allies in an increasingly turbulent world.”

Under this scenario, Europe would buy more high-value light oil from the U.S., whose domestic needs would be back-stopped by lower-priced heavy oil imports from Canada, whereas Asia would consume more LNG from Canada, diminishing China and Russia’s economic and strategic leverage over it.

* * *

The MEI is an independent public policy think tank with offices in Montreal, Ottawa, and Calgary. Through its publications, media appearances, and advisory services to policymakers, the MEI stimulates public policy debate and reforms based on sound economics and entrepreneurship.

As the nation’s largest, most broadly supported conservative research and educational institution, The Heritage Foundation has been leading the American conservative movement since our founding in 1973. The Heritage Foundation reaches more than 10 million members, advocates, and concerned Americans every day with information on critical issues facing America.

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