• 4 minutes England Running Out of Water?
  • 7 minutes Trump to Make Allies Pay More to Host US Bases
  • 10 minutes U.S. Shale Output may Start Dropping Next Year
  • 14 minutes Washington Eyes Crackdown On OPEC
  • 54 mins One Last Warning For The U.S. Shale Patch
  • 5 hours Once Upon A Time... North Korea Abruptly Withdraws Staff From Liaison Office
  • 5 hours Chile Tests Floating Solar Farm
  • 4 hours Oil Slips Further From 2019 Highs On Trade Worries
  • 12 hours Poll: Will Renewables Save the World?
  • 10 hours Modular Nuclear Reactors
  • 21 hours China's E-Buses Killing Diesel Demand
  • 21 hours Trump sells out his base to please Wallstreet and Oil industry
  • 17 hours China's Expansion: Italy Leads Europe Into China’s Embrace
  • 1 day Russian Effect: U.S. May Soon Pause Preparations For Delivering F-35s To Turkey
  • 1 day Read: OPEC THREATENED TO KILL US SHALE
  • 1 day Trump Tariffs On China Working
  • 1 day Biomass, Ethanol No Longer Green
  • 9 hours US-backed coup in Venezuela not so smooth
Why OPEC’s Decision To Delay Makes Sense

Why OPEC’s Decision To Delay Makes Sense

OPEC’s decision to maintain the…

Oil Price Rally Hits Resistance

Oil Price Rally Hits Resistance

Oil prices are holding their…

Enbridge Says New Pipeline Regulations Mean Costly Delays

Enbridge says that new requirements expected to come out of a Minnesota environmental impact statement for work on two major U.S. pipeline projects could lead to the delay of some $5 billion in capital expenditure.

At stake are the Sand Piper light crude oil pipeline and the Line 3 Replacement Project, both running through the state of Minnesota and projected to costs a total of $2.6 billion.

The problem for Enbridge is a new requirement that makes it necessary to receive a final environment impact (EIS) statement before a company can even start the process of obtaining a route permit.

Related: Total’s Impressive Earnings And Generous Dividend Surprises Markets

Enbridge says the new requirement is both “unprecedented” and “contrary to Minnesota law”, as reported by the Financial Post. At the end of the day, Enbridge says the new procedures will result in a two-year delay and all the costs associated with that.

The two pipelines will now likely be pushed back to 2019, but the delay will also allow Enbridge to cut its 2016 capital budget by some 20 percent as costs are deferred.

The hold up in Minnesota is pressured by opposition to the pipelines by environmental groups and Native American tribes who fear potential oil leaks.

Related: Why OPEC Production Freeze Could Pave The Way For Actual Cuts

In 2015, Enbridge spent $1.14 billion on new pipelines, expansion and maintenance, while this year that figure is expected to come in around $900 million.

The Sand Piper pipeline, which will run from North Dakota’s Bakken to Wisconsin, passing through Minnesota. This is the larger of the two pipeline projects, and a joint venture with Marathon Petroleum. The Line 3 Replacement is a reconstruction of a 1960s pipeline from Edmonton in Alberta to Wisconsin.

Enbridge has already invested $195 million into Sand Piper and $65 million into the Line 3 Replacement.

By Charles Kennedy of Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment
  • Mike H. on February 19 2016 said:
    Enbridge has yet to pay all it's fines for the 2010 Kalamazoo MI massive spill:

    http://insideclimatenews.org/news/19022016/EPA-Enbridge-negotating-fine-2010-Kalamazoo-river-spill-clean-water-act-dilbit

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News