Already a Bloomberg.com user?
Sign in with the same account.
Energy Transfer Partners LP
Enbridge Inc. will join Energy Transfer Partners LP (ETP) to convert part of the Trunkline natural gas system to oil, making it the first pipeline capable of sending crude to the eastern Gulf Coast from the Midwest.
The project will handle 420,000 to 660,000 barrels a day and span more than 700 miles (1,100 kilometers), Calgary-based Enbridge said in a statement today. Energy Transfer, which owns the system with Energy Transfer Equity LP, has previously announced plans to convert it at a cost about $1.5 billion.
Pipeline companies are seeking ways to transport more crude from expanding production in the Bakken Shale formation in North Dakota and oil-sands projects in Canada. Enbridge and Enterprise Products Partners LP announced a reversal of the 500-mile Seaway pipeline to the Houston area from Cushing, Oklahoma, last year. TransCanada Corp. is continuing with plans to build the Keystone XL pipeline to transport Alberta bitumen to U.S. refiners.
“Together with our western Gulf Coast access program, which includes the expanded Seaway pipeline, this new project would provide western Canadian and Bakken producers with access to the largest refining center in the world,” Al Monaco, chief executive officer of Enbridge, said in the statement.
Subject to federal approval and sufficient customer interest, Trunkline shipments of crude would begin in 2015 from Patoka, Illinois, to the St. James, Louisiana, hub which connects to refineries in the New Orleans area.
“This is another step in the process of bringing inland crude to where it needs to go and getting value for producers in the upper Midwest,” Stephen Schork, president of Schork Group Inc. in Villanova, Pennsylvania, said in a phone interview.
The news was released before regular trading began on U.S. markets. Enbridge fell 0.2 percent to C$44.13 yesterday in Toronto. Energy Transfer rose 0.5 percent to $47.04 in New York.
To contact the reporter on this story: Jim Polson in New York at email@example.com
To contact the editor responsible for this story: Susan Warren at firstname.lastname@example.org