The Minnesota Public Utilities Commission is starting to hold on Tuesday public hearings on the certificate of need and route permit applications for Enbridge's Line 3 project, in what could be the last hurdle to the company's plans or a refusal by the state to grant permit for construction works.
The Line 3 Replacement Program, with a US$4.28 billion (C$5.3-billion) Canadian component and a US$2.9-billion American component, is planned to fully replace 1,031 miles of Line 3 with new pipeline and associated facilities on either side of the Canada-U.S. international border. The U.S. portion of the program is from Neche, North Dakota, through Minnesota, and on to Superior, Wisconsin.
The pipeline project envisages higher capacity and changes in routing in some parts, and this urges opponents of the plan to argue that the replacement project is more like a new pipeline plan.
Canadian oil producers, on the other hand, support the project, saying that it would increase the takeaway capacity of their oil, which is trading at a discount to WTI, partly because of Canada's limited export capacity.
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Hearings in Minnesota will be held until November 15 and will include groups of landowners, aboriginals, and environmentalists, many of whom are firmly against the project. The Minnesota commission is not due to decide whether it will approve the project until April 2018. If Minnesota denies a construction permit in the state, Enbridge can appeal. Such an outcome, however, would further delay the plan.
Two weeks ago, Minnesota's Department of Commerce dealt a blow to Enbridge with a report that said the replacement of the Line 3 pipe that runs through the state is unnecessary, as is the pipe itself. The Department of Commerce also believes that the current six-pipeline system that Enbridge runs in Minnesota is enough to accommodate the crude that the state needs over the long term, in light of estimates that show the demand for gasoline and other fuels is unlikely to increase, the department said, adding that local refiners operated near full capacity in any case.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. More