Although Enbridge does not yet have a cost estimate for the project, Gruending added that the expansion could come online as early as 2026 or 2027. He noted that it would be a small expansion that would add additional capacity along the existing pipeline network. which has already been expanded several times during its 75-year history.

“It’s really more of an optimization, not a withdrawal or a new path. It’s within the (existing) right-of-way…it’s very enforceable,” Gruending said.

The Enbridge Mainline is the largest pipeline system in North America, moving crude from Western Canada to markets in Eastern Canada and the U.S. Midwest.

Not long ago, industry observers thought the Mainline would be hit when the Trans Mountain pipeline expansion opened and began providing Canadian oil companies with access to new offshore export markets. from the West Coast.

However, this did not happen. Enbridge expects its full-year average volume on the Mainline to exceed three million barrels per day in 2024, not much different from the 3.1 million barrels per day it has reached in 2023 before the start of the Trans Mountain expansion project.

And Canadian oil production and exports continue to grow. Canadian crude oil production hit an all-time high in 2023, at 5.1 million barrels per day, as companies ramped up efforts in anticipation of the start of the Trans Mountain expansion. Analysts suggest the total could rise by an average of 500,000 barrels per day this year.

Canada’s crude exports hit a record four million barrels per day in 2023, according to Statistics Canada, and continue to climb. According to figures from the United States Energy Information Administration released this week, Canadian crude exports to the United States reached a record 4.3 million barrels per day in July 2024, following the start of the Trans project. Mountain.

The increase in production was so significant that Enbridge said the mainline was dispatched in July and August and then again in November. Allocation is an industry term for what happens when demand for uncontracted space on a pipeline exceeds available capacity in a given month.

“I don’t know if I’ll be able to see a breakdown every month in the future here, but seasonally I think you’ll see a lot of demand for the mainline,” Gruending said.

Many analysts have suggested that Canada’s current oil boom could reignite the problem of pipeline shortages sooner rather than later. Before the Trans Mountain expansion project opened earlier this year, Canadian oil companies were hamstrung by a lack of pipeline export capacity, which meant the price of Canadian heavy crude often traded at a price much lower than the American reference price.

Most industry observers believe the Trans Mountain expansion was likely the last major pipeline project this country will see, given the extreme regulatory, political and environmental challenges associated with pipeline construction.

The Trans Mountain project faced so many obstacles that the federal government ultimately purchased it from developer Kinder Morgan Canada, simply to ensure the pipeline would cross the finish line.

But in another conference call Friday, Imperial CEO Brad Corson said he’s not worried the industry will run out of pipeline capacity anytime soon.

“We see that there is several years of headroom based on existing capacity, but we also believe that there will likely be additional capacity that will be reached in both the Enbridge system and the (from Trans Mountain) as these operators seek more. decongestion,” Corson said.

“We have no concerns about (export capacity). Whereas a few years ago, it was an important consideration when we were thinking about new… growth projects.

Gruending said Enbridge is also exploring a number of potential expansion projects for its smaller regional pipelines that serve Alberta’s oilsands industry.

“It’s very important economically that the (Western Canadian Sedimentary Basin) is not constrained,” he said.

Earlier this year, the Canada Energy Regulator approved Enbridge’s new pricing framework for the Mainline. Tolls are the fees oil companies pay to ship their products via pipeline, and Enbridge had been negotiating a new toll framework with its oil industry customers for a year and a half.

Tolls for the new, expanded Trans Mountain pipeline have not yet been finalized as oil companies object to the higher costs than Trans Mountain Corp. would like to charge to help cover cost overruns related to the construction of the project.

On Friday, Enbridge reported third-quarter earnings attributable to common shareholders of $1.29 billion, up from $532 million a year earlier.

The company said earnings were 59 cents per share for the quarter ended Sept. 30, compared with 26 cents per share in the same quarter last year.

The most recent quarter’s results included a net unrealized gain on the fair value of non-cash derivatives of $112 million, compared to an unrealized net loss of $782 million a year ago when there was also a provision adjustment of $124 million related to litigation. .

On an adjusted basis, Enbridge said it earned 55 cents per share in its most recent quarter, down from adjusted earnings of 62 cents per share a year earlier.

The average analyst estimate was for earnings of 56 cents per share, according to LSEG Data & Analytics.

This report by The Canadian Press was first published November 1, 2024.