Page 8 - NorthAmOil Week 33 2021

NorthAmOil PIPELINES & TRANSPORT NorthAmOil
Enbridge close to Line 3 replacement start-up
NORTH AMERICA
CANADA’S Enbridge could bring the Line 3 replacement oil pipeline online in September, bringing relief to Alberta’s oil sands produc- ers, who have long struggled with a lack of new takeaway capacity. A notice sent to shippers on the pipeline showed that it was 30-60 days from completion.
“Enbridge has filed for toll surcharges on the Line 3 replacement with the Canada Energy Regulator [CER] and Federal Energy Regulatory Commission [FERC], which could be effective as earlyasSept.15,”anEnbridgespokespersontold Bloomberg last week. “There will be a further fil- ing to specify the specific in-service date shortly before the line goes into service once all neces- sary construction and commissioning activities are complete.”
Completion of the Line 3 replacement will come after Enbridge spent years working its way through regulatory and legal hurdles to build the pipeline. As well as being the first major new oil sands pipeline to enter service in years, the Line 3 replacement will be the first cross-border project between the US and
Canada to come online in a long time.
The replacement project will more than dou- ble capacity on Line 3 from 370,000 barrels per day (bpd) to 760,000 bpd, returning the pipeline back to its original operating pressure. The pro- ject’s costs have escalated amid the delays it has experienced, and were estimated to be around
$7.3bn as of February.
The news will be welcomed by oil sands pro-
ducers, some of whom have had to turn to more costly crude-by-rail shipments as their output has rebounded from pandemic-related disrup- tions year. And the Line 3 replacement is not the only major new pipeline set to come online soon, with the government-owned Trans Mountain expansion to Canada’s West Coast not far behind and aiming for start-up in 2022.
Construction on the Line 3 replacement is complete in Canada, North Dakota and Wis- consin, while work is being wrapped up in Minnesota – which was the last state to issue reg- ulatory approvals for the pipeline. Opponents are embarking on a last-ditch effort to halt the project but these attempts appear futile at this point.™
INVESTMENT
ConocoPhillips reportedly seeks buyer for Williston assets
NORTH DAKOTA
US-BASED ConocoPhillips has reportedly put its oil assets in the Williston Basin up for sale. Cit- ing sources familiar with the matter, Bloomberg reported this week that the company estimates the assets as being able to fetch up to $200mn.
A ConocoPhillips spokesperson declined to comment on the matter, according to Bloomberg. Nonetheless, an attempt to market the assets would be in line with the company’s position on constantly reviewing its portfolio and look- ing for opportunities to buy and sell assets. This was articulated by ConocoPhillips’ chairman and CEO, Ryan Lance, earlier this month on the
company’s second-quarter earnings call.
The development also comes amid the ongo- ing wave of consolidations across the shale industry, including both company mergers and asset-based deals. A number of major transac- tions have taken place over the past year, includ- ing ConocoPhillips’ acquisition of Concho Resources, which closed in January. The deal significantly expanded ConocoPhillips’ holdings in the Permian Basin, which was the sole focus of
Concho’s operations.
Indeed, ConocoPhillips may be considering
further expanding its Permian footprint, hav- ing been reported last month to be among the companies that are considering buying Royal Dutch Shell’s assets in the basin. This emerged in a separate Bloomberg report, with the news ser- vice citing people familiar with the matter, and also identifying Devon Energy and Chevron as potential buyers for the assets. Shell’s Permian properties may be worth up to $10bn in a sale, according to the sources.
In North Dakota and Montana’s Williston Basin, which holds the Bakken play, assets have also been changing hands. In April, Norway’s Equinor sold its entire Bakken portfolio to Gray- son Mill Energy for around $900mn. Also in April, Hess sold off $312mn of non-core Bakken assets to Enerplus, though the region remains one of its main areas of focus.
Meanwhile, Oasis Petroleum sold off Per- mian assets while acquiring additional holdings in the Bakken in separate transactions in May.™
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w w w . N E W S B A S E . c o m Week 33 19•August•2021