PIPELINES:

Keystone XL-inspired clash begins over Enbridge's $7B expansion plan

Enbridge Inc. and environmentalists yesterday tangled over the oil sands giant's claim -- not yet confirmed -- that it can spend $7 billion to nearly double the size of a thousand-mile Canada-to-U.S. crude pipeline without getting a State Department review similar to Keystone XL's.

Enbridge avowed yesterday that it would not need State's sign-off to replace its so-called Line 3 from Alberta to Wisconsin with a more state-of-the-art line that can carry 370,000 more barrels per day (bpd) and transport heavy as well as light crude. Greens cried foul, noting that Enbridge remains in search of an amended border-crossing permit for a separate expansion 20,000 bpd smaller than Line 3.

A State official late yesterday would not say whether the company correctly interprets its U.S. regulatory burden, saying only that "Enbridge brought this matter to our attention, and the information provided is under review."

Looming over the Line 3 expansion is Keystone XL, the controversial project that is cheaper than and comparable in size to Enbridge's new plan: the same diameter, 148 miles longer and 70,000 bpd larger when running crude at maximum capacity. Enbridge already has pushed back its time frame for winning an amended State permit to expand its Alberta Clipper line amid resistance from the same green groups that view Line 3 as the next front in their battle to slow further development of the emissions-intensive Canadian oil sands reserves.

"Like with their proposed Alberta Clipper pipeline expansion, Enbridge will need a new presidential permit for the project," Sierra Club staff attorney Doug Hayes said in a statement yesterday. "And the same climate test that the president set for the Keystone XL pipeline will apply."

Beth Wallace of the National Wildlife Federation called the company's pitch "absurd and insulting" given local resistance to Enbridge pipeline replacement plans in Michigan, where the so-called Line 6B leaked an estimated 840,000 gallons of oil sands crude into the Kalamazoo River in 2010.

"Enbridge needs to call this project what it is, which is another tar sands pipeline expansion and not a replacement," Wallace said in a statement.

The Line 3 replacement, set for completion in 2017 according to the plans Enbridge unveiled yesterday, may yet prove more incendiary than other expansion plans because the pipeline's current iteration transports light crude while its new version could ship heavy oil sands product.

The company's vast pipeline network ships more than 2 million bpd, including the vast majority of western Canadian crude sales that constitute an estimated 13 percent of daily U.S. oil imports. Enbridge affirmed yesterday that it would need regulatory vetting by Canada's National Energy Board and the U.S. Federal Energy Regulatory Commission before beginning the replacement.

Twitter: @eschor | Email: eschor@eenews.net

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