Page 6 - NorthAmOil Week 02 2022

NorthAmOil PIPELINES & TRANSPORT NorthAmOil

Enbridge launches hydrogen blending project

ONTARIO ENBRIDGE Gas announced on January 13 that closer to its goal of net-zero emissions by 2050.
a hydrogen blending project that it has described Both Enbridge and Canada as a whole have also
as the first of its kind in North America was now set a deadline of 2050 for meeting their net-zero
fully operational. emissions targets.
The CAD5.2mn ($4.2mn) pilot blending pro- Through this pilot project, Enbridge said it
ject was launched in partnership with Cummins would initially provide a maximum hydrogen
and with support from Sustainable Development blended content of up to 2% by volume of the
Technology Canada (SDTC), the Canadian Gas natural gas supplied to its Markham customers
Association (CGA) and NGIF Capital. The pro- in the third quarter of 2021. It noted that the
ject is serving the city of Markham, Ontario, pilot project would not affect the standard mar-
where Enbridge’s natural gas system serves ket cost of the gas.
around 3,600 customers. It involved enhance- The company anticipates that the success of
ments to the existing Markham power-to-gas the pilot project will place it in a position to val-
facility, which Enbridge and Cummins built in idate and pursue larger-scale hydrogen-blend-
2018 in an effort to help balance Ontario’s elec- ing activities in other parts of its distribution
tricity supply and demand by storing surplus system.
electricity as pure hydrogen until it was needed. Hydrogen blending remains challenging,
Now some of this hydrogen is being blended though, particularly where blends with a higher
into Enbridge’s gas system in a bid to lower hydrogen content are involved. The more hydro-
greenhouse gas (GHG) emissions from that gas gen is being blended, the more infrastructure
network. upgrades are likely to be required, and pipeline
Enbridge said the project would eliminate up operators are only now beginning to test how
to 117mn tonnes per year (tpy) of carbon diox- much hydrogen their existing gas systems can
ide (CO2) emissions, taking Markham a step currently handle.™

Enterprise to expand in Midland Basin

with $3.3bn Navitas acquisition

PERMIAN BASIN ENTERPRISE Products Partners announced on on commodity prices, according to Enterprise’s
January 10 that it had agreed to acquire Navitas statement. The companies estimate that the ded-
Midstream Partners from an affiliate of Warburg icated acreage contains over 15 years of drilling
Pincus for $3.25bn. inventory based on current rig counts, or up to
The deal will expand Enterprise’s presence 10,000 drilling locations.
into the Permian Basin’s Midland sub-basin, Enterprise anticipates that based on the cur-
where the company does not currently have gas rent outlook for commodity prices, the deal will
or natural gas liquids (NGLs) operations other add around $0.18-0.22 per unit to its distributa-
than downstream pipelines. ble cash flow in 2023.
“This acquisition will give us an entry point The Permian, where drillers are primarily
into the basin,” stated the co-CEO of Enterprise’s targeting oil, is known for large volumes of asso-
general partner, Jim Teague. ciated gas production. Drilling in the Midland is
Navitas provides natural gas gathering, treat- currently estimated to account for roughly 20%
ing and processing services in the core of the of active onshore rigs in the US.
Midland Basin. The company’s assets include Enterprise’s acquisition comes at a time when
around 1,750 miles (2,816 km) of pipelines. gas prices and demand are surging. Front-month
Meanwhile, the completion of the Leiker plant US gas futures were trading at around $4.09 per
– expected in the first quarter of this year – will million British thermal units ($113.13 per 1,000
bring its cryogenic gas processing capacity to cubic metres) on January 10.
over 1bn cubic feet (28.3mn cubic metres) per “It seems like a strong deal” for Enterprise, a
day. managing director at Mizuho Securities, Gabriel
The Navitas system is anchored by long-term Moreen, was quoted by Bloomberg as saying.
contracts and acreage dedications with a group He added that Navitas’ assets integrate well with
of over 40 independent and publicly listed pro- Enterprise’s existing gas liquids infrastructure.
ducers. It is also supported by fee-based con- “For the industry as a whole, it shows consolida-
tracts that provide additional revenue depending tion is happening – slowly but surely.”™

P6 www. NEWSBASE .com Week 02 13•January•2022