Page 13 - NorthAmOil Week 24

NorthAmOil PIPELINES & TRANSPORT NorthAmOil

Enbridge receives favourable

court rulings for Line 5 upgrade

MICHIGAN CALGARY-BASED pipeline operator Enbridge wildlife in the straits.
has received two favourable court rulings related As a result of the ruling, Enbridge’s oil
to plans for its Line 5 project – which connects spill response plans will not require addi-
Superior, Wisconsin with Sarnia, Ontario – since tional environmental or endangered species
the start of this month. The company is propos- analyses.
ing to build a utility tunnel under the Straits of The second favourable legal decision came
Mackinac, which connect Lakes Huron and from the Michigan Court of Appeals, which
Michigan. This would surround a rebuilt section upheld a lower court ruling that a 2018 law
Enbridge is proposing of Line 5, which carries 540,000 barrels per day allowing construction of a new Enbridge oil
to build a utility tunnel (bpd) of oil and natural gas liquids (NGLs). The pipeline tunnel under the Straits of Mackinac
under the Straits of replacement would comprise a single pipeline, was constitutional. However, this is not the end
Mackinac to surround a while the existing dual pipelines that cross the of the road for the case, which is now expected to
rebuilt section of Line 5. straits and have been in service since 1953 would go to the Michigan Supreme Court.
be taken out of service. There are also two further cases involving
First, a US federal appeals court has ruled Line 5 working their way through Michigan’s
that pipeline operator Enbridge’s plan for deal- legal system currently.
ing with a potential oil spill from pipelines in the Public hearings are due to begin this sum-
straits were legally acceptable. mer on Enbridge’s applications for construc-
The ruling, issued by 6th US Circuit Court tion permits for the tunnel. Assuming all
of Appeals, overturned a decision by a lower regulatory approvals are granted on sched-
court, which had agreed with an environmen- ule and litigation does not result in delays,
tal group that Enbridge’s plans failed to ade- Enbridge anticipates completing the $500mn
quately consider potential harm to fish and tunnel project in 2024.™

PERFORMANCE

Ovintiv to cut jobs across North America

NORTH AMERICA OVINTIV – formerly known as Encana – has company said the move was being made so it
said that it is laying off workers in both the US could access increasingly larger pools of invest-
and Canada as it reduces drilling activity in ment in US index funds and passively managed
response to the oil market downturn. An Ovintiv accounts. Prior to this, Encana had been reposi-
spokeswoman, Cindy Hassler, told CBC News tioning itself to focus more on liquids and shed-
that the company had reduced the number of ding non-core assets until it was left with a small
rigs it operates from 23 to seven. number of areas of focus.
“We expect our future activities also will be Ovintiv’s main assets now are in the Permian
lower than prior expectations,” she said. and Anadarko basins in the US, as well as the
The company has not yet provided details Montney shale play in Canada. It has operations
on how many people would be affected by the in four other shale-producing regions in the US
job cuts, but more information is anticipated and Canada.
later this week. Hassler noted, however, that According to Hassler, the company antici-
all levels would be affected, from the executive pates the industry transitioning to lower pro-
level down, and across all offices, including field duction growth, and a greater focus on free
offices. She added that the workforce reductions cash generation, stronger balance sheets and
were near-equal percentages across the compa- modest growth. She said Ovintiv’s current deci-
ny’s three corporate offices – in Calgary, Denver sion-making was being partly informed by these
and the Woodlands, Texas. expectations.
Ovintiv announced in October 2019 that Ovintiv cut its capital expenditure budget
it was moving its headquarters from Calgary for 2020 by $300mn in the second quarter of the
to Denver, as well as changing its name. The year, shortly after crude prices collapsed.™

Week 24 18•June•2020 www. NEWSBASE .com P13