Minnesota commission edging towards support of Enbridge Line 3 pipeline

Line 3
The Minnesota Public Utilities Commission is the final regulatory hurdle facing Enbridge's Line 3 construction.  Reuters reports approval of the certificate of need appears to be imminent. National Energy Board file photo.

The Minnesota Public Utilities Commission is the final regulatory hurdle facing Enbridge’s Line 3 construction.  Reuters reports approval of the certificate of need appears to be imminent. National Energy Board file photo.

$7.4 billion Line 3 replacement project would double the pipeline’s capacity

Reuters reports that on Thursday, three members of the five-member Minnesota Public Utilities Commission said they are in support of issuing a certificate of need for Enbridge to rebuild its aging Line 3 pipeline.

The two other commissioners did not say they would vote in favour of the certificate, but approval appears to be imminent.

The Minnesota Public Utilities Commission (PUC) is made up of three Democrats and two Republicans and, if they support Enbridge’s request, would be the final regulatory hurdle for the project.

“I think we have a certificate of need decision essentially made,” commissioner John Tuma told Reuters.

The commission has adjourned for a break and is planning to discuss conditions that it will place on the certificate before holding a vote.

Earlier this month, BMO Capital Markets analyst Ben Pham told the Financial Post that he believes the most likely outcome of the process would be an approval of the line along the company’s preferred route.  However, the Minnesota PUC will ask Enbridge to dig up and replace the old pipeline.  Such an order would add US$1.2 billion to the cost of the project.

Should the commission approve the project, the new pipeline will double the capacity of the current line to 760,000 barrels of oil per day.

The current 1,031 mile-long pipeline which carries Alberta crude to refineries in the US midwest was built in the 1950’s.

Canadian oil producers are hoping the project goes ahead.  Pipeline bottlenecks have boosted the price discount for Western Canadian heavy crude this year.

Refiners in Minnesota and nearby states say the Enbridge line is necessary to increase oil supplies.

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