June's AI-picked stock updates now live. See what's new in Tech Titans, up 28.5% year to date.Unlock Stocks

UPDATE 1-Canada to rule on two pipelines, mum on Kinder Morgan expansion plans

Published 2016-11-22, 12:56 p/m
© Reuters.  UPDATE 1-Canada to rule on two pipelines, mum on Kinder Morgan expansion plans
KMI
-
ENB
-

(Adds spokesman comment on announcement timing)

By David Ljunggren

OTTAWA, Nov 22 (Reuters) - Canada will this week decide the fate of two Enbridge Inc ENB.TO pipelines, but is keeping quiet about its verdict on Kinder Morgan (NYSE:KMI) Inc's KMI.N plans to more than double the capacity of its Trans Mountain line, a move strongly opposed by environmentalists.

The Liberal government is expected to veto Enbridge's Northern Gateway pipeline from Alberta's oil sands to the province of British Columbia on the Pacific Coast. Prime Minister Justin Trudeau opposes the project, citing the proposed routing through a rain forest. Ottawa does appear set to allow Enbridge to replace the Canadian segments of its Line 3, which takes crude from Alberta to Wisconsin. Canada's energy regulator approved the project in April. is under pressure both from environmentalists and the energy industry, which says it needs more pipelines to ease transport bottlenecks in Alberta.

"Our government is on track for a decision on the proposed Enbridge Line 3 and Northern Gateway projects by Nov 25. An announcement ... will be made soon thereafter," said Alexandre Deslongchamps, spokesman for Natural Energy Minister Jim Carr.

Trudeau is scheduled to leave on Wednesday for a week-long trip to Africa.

Northern Gateway foundered amid protests from green and aboriginal groups that are now targeting Trans Mountain. But the plan to update Line 3, which sources say will switch from carrying light oil to synthetic crude, attracted little attention.

"Most people are expecting it goes forward," said AltaCorp Capital energy infrastructure analyst Dirk Lever.

The upgrade would allow Enbridge to run Line 3 at its maximum capacity of 760,000 barrels per day (bpd). It is currently shipping 390,000 bpd because of voluntary pressure restrictions.

"It's not adding to capacity," said Friends of the Earth policy adviser John Bennett. "I haven't seen any chatter about it at all."

There is, however, much debate about Kinder Morgan's plans to build a second pipeline next to its Trans Mountain line from Alberta to British Columbia.

Greens say the risk of a spill is too great and opponents promise massive protests, which some Liberals fear could hurt the party in federal elections set for 2019. Earlier this month, a Liberal legislator from British Columbia urged Trudeau to veto the line.

Environmental groups say they expect Carr to approve Trans Mountain by the Dec. 19 deadline. He said last week that Canada needed to sell oil to Asia to diversify exports away from the United States. said Carr was committed to a verdict by Dec. 19.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.