Maybe It's Time, Part 4 - Enbridge's Mainline Crude System Advances Toward a New Era

Enbridge’s long-running effort to revamp how it allocates space — and charges for service — on its 2.9-MMb/d Mainline crude oil pipeline system is about to enter a new and important phase. On July 15, the Calgary, AB-based midstream giant plans to initiate an open season for shippers interested in locking up long-term capacity on the Mainline, which serves as the primary conduit for heavy and light crude from Western Canada to U.S. crude hubs and refineries. If all goes well, shippers will know by late in the year how much space they will have on the system starting in mid-2021, assuming Enbridge’s plan is approved by regulators. This is a huge change. The Mainline isn’t just the largest crude pipeline system out of Western Canada, it’s also the only major line whose service is currently 100% “uncommitted” — that is, the Mainline has no capacity under long-term contracts with shippers. Today, we discuss the latest on the midstreamer’s Mainline tolling plan.

Starting on July 5, Alberta’s largest city again will host the Calgary Stampede, a 10-day rodeo and celebration of Western culture billed as “The Greatest Outdoor Show on Earth.” The Stampede is the event of the year in Calgary (nicknamed “Stampede City”), typically attracting more than 1 million visitors. Hardly anything else gets done in the city while the Stampede is on. The day after the Stampede ends on July 14, though, a lot of folks in Alberta’s energy sector will turn their attention to the open season that Enbridge (Calgary’s largest company by revenue) plans to initiate for long-term capacity on its Mainline crude pipeline system.

As we said in earlier episodes of our blog series, Enbridge’s multi-pipe Mainline system accounts for a staggering 70% of Western Canada’s total export-related pipeline capacity. The system’s parallel Lines 1, 2, 3, 4 and 67 transport crude from Edmonton and Hardisty, AB, to Clearbrook, MN, and Superior, WI. From there, other Mainline pipes move crude to Flanagan in north-central Illinois (Line 61), the Chicago area (Lines 6, 14 and 64), Michigan (Lines 5 and 78) and Ontario (Lines 5, 78, 7, 10 and 11). The Canadian side of the Mainline system is known (logically enough) as the Canadian Mainline (green lines in Figure 1), while the U.S. side is called the Lakehead Mainline (blue lines) because it runs near all five of the Great Lakes.

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