Enbridge Eyes New Pipeline to Boost Canadian Oil Flows in US
(Bloomberg) -- Enbridge Inc. and partner Energy Transfer LP are gauging interest in increased pipeline capacity in Illinois that would help rising Canadian oil sands production reach more markets in the Midwest and the US Gulf Coast.
The companies are marketing a project called the Southern Illinois Connector that would transport as much as 200,000 barrels of crude a day by reconfiguring and upgrading existing systems as well as building a new segment, Calgary-based Enbridge said in an e-mailed response to questions. The operation is a response to industry demand for more shipping capacity from Flanagan, Illinois, to the US Gulf Coast, the company said.
The project, which would entail constructing a new pipeline connecting the Illinois oil hubs of Wood River and Patoka, is meant to accommodate rising Canadian oil production, with the International Energy Agency projecting the country’s output will grow 680,000 barrels a day by the end of the decade. Most of the increase will come from the oil sands, driven by optimizations and debottlenecking, rather than new projects, the IEA said.
The Southern Illinois Connector would get Canadian oil from Enbridge’s Mainline and connect to the Energy Transfer Crude Oil Pipeline at Patoka, according to people familiar with the matter. That Energy Transfer pipeline, which can transport 470,000 barrels a day, delivers oil to a terminal in Nederland, Texas, that serves refineries in the Port Arthur area.
The open season for the project, during which potential shippers can indicate interest in taking space in the pipeline, is open until July 18, Enbridge said.
(Updates with project details starting in second paragraph)
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