Enbridge Sees New Pipeline To US Gulf Operating In October
Aug 1 (Reuters) - Enbridge Inc's new 450,000 barrel-per-day Seaway Twin pipeline, to carry Canadian oil sands crude to North America's largest refining complex on the U.S. Gulf Coast, will likely start operating in October, the company said on Friday.
Enbridge, Canada's biggest pipeline company, said mid October is most likely when the Seaway Twin will be filled with crude from the company's new 600,000 bpd Flanagan South pipeline.
Seaway Twin will carry crude from Cushing, Oklahoma, to oil tanks near Houston, and although the pipeline was mechanically completed in early July, it will not start operating before Flanagan South, which will run from Illinois to Cushing, is finished in early October.
Traders have been closely monitoring the progress of the two pipelines, which will give Canadian oil sands producers another direct link to the Gulf Coast.
"The plan had been, and still is, to do line fill for Seaway Twin from Flanagan South," Guy Jarvis, Enbridge president of liquids pipelines, said on a second-quarter earnings conference call. "So we do not expect to see too much off Seaway Twin before Flanagan South goes into service."
Enbridge exports the bulk of Canadian crude to the United States on its Mainline system, which in June moved a record 2.1 million bpd.
Surging Canadian production and congested pipelines that left crude bottlenecked in Alberta prompted the company to undertake a series of expansion projects and consider building a 140,000 crude-by-rail terminal in Illinois.
Morningstar analyst David McColl said it had been a steady quarter for Enbridge and that its massive Mainline expansion program seemed to be progressing well.
"Enbridge has layered on C$42 billion ($38 billion) of growth projects and is undertaking the largest extension of its liquids pipeline system in decades," McColl said.
"They are expanding from Fort McMurray (in Alberta) to the Gulf Coast (and) to Montreal, and so far they are doing it successfully."
Enbridge reported a stronger-than-expected profit in the second quarter, driven mainly by higher shipment volumes on the Mainline and on its regional oil sands systems.
The company reaffirmed its full-year adjusted earnings forecast of C$1.84-C$2.04 a share.
Adjusted earnings rose to C$328 million, or 40 Canadian cents a share, in the quarter ended June 30, from C$306 million, or 38 Canadian cents a share, a year earlier.
Analysts, on average, had expected a profit of 39 Canadian cents a share, according to Thomson Reuters I/B/E/S.
Earnings attributable to shareholders rose to C$756 million, or 91 Canadian cents a share, in the quarter, from C$42 million, or 5 Canadian cents a share, a year earlier.
Enbridge shares were last down 0.2 percent on the Toronto Stock Exchange at C$53.32.
(Additional reporting by Sneha Banerjee in Bangalore; Editing by Savio D'Souza, Simon Jennings and Peter Galloway)
WHAT DO YOU THINK?
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
- Oil Groups Warn Trudeau's Reforms Will Make it Worse (Nov 08)
- Gas Deliveries Resuming as Cold Descends on British Columbia (Oct 12)
- Gas Flows Resume After Canada Pipe Rupture Hits Oil Refiners (Oct 11)