(In fourth paragraph, corrects figure for surge in capacity to
million, not billion )
By Nia Williams
CALGARY, Alberta Feb 17 Two new crude oil
export pipelines will provide enough capacity to ship Canadian
production to market until at least the mid 2020s, Enbridge Inc
Chief Executive Al Monaco said on Friday, making clear
his company's Line 3 should be one of them.
Monaco's comments come amid growing speculation that Canada
faces pipeline overbuild after years of struggling with limited
The Canadian government approved Enbridge's Line 3
replacement project and Kinder Morgan's Trans Mountain
expansion last November, while U.S. President Donald Trump
invited TransCanada to reapply for a Keystone XL permit
in January. TransCanada is also awaiting permits for its
proposed Energy East project.
If all four pipelines get built the 2.1 million barrel per
day surge in capacity would fast outpace industry forecasts of
Canadian crude production growth of 850,000 bpd by 2021.
"If you look at the supply profile and you look at our
expansion replacement capacity for Line 3 and one other
pipeline, that should suffice based on the current supply
outlook, out to at least mid-next decade," Monaco said on a
fourth quarter earnings call.
Monaco said Enbridge had another 400,000 bpd of potential
capacity expansion opportunities in addition to Line 3 but the
company would be guided by the amount of supply coming out of
Wood Mackenzie analyst Mark Oberstoetter said his firm
agreed with Monaco's assessment on the need for new pipelines.
"We definitely need two of these pipelines by around 2025
and after that it depends on the supply outlook," Oberstoetter
said. "There's not an evident need to get three or four
Enbridge, Canada's largest pipeline company, also announced
a C$1.7 billion ($1.3 billion) investment in a North Sea
The 50 percent ownership in EnBW's Hohe See
strengthens Enbridge's footprint in Europe's booming offshore
wind power industry.
Monaco said there could be more to come given the push
towards renewable energy in a number of European countries.
Enbridge reported fourth-quarter profit on Friday that
included a C$373 million before-tax impairment charge related to
its Northern Gateway pipeline, which the Canadian government
blocked last year.
Earnings attributable to the company's shareholders were
C$365 million ($279 million), or 39 Canadian cents per share, in
the fourth quarter, hurt by charges, including for asset
impairment and restructuring.
($1 = 1.3110 Canadian dollars)
(Additional reporting by Arathy S Nair in Bengaluru; Editing by
Savio D'Souza, Grant McCool and Bernard Orr)