Page 9 - NorthAmOil Week 23

NorthAmOil COMMENTARY NorthAmOil

Enbridge to pivot towards

gas, renewables

North American pipeline operator Enbridge has said it will

gradually shift its asset mix towards natural gas and renewables

in order to reflect the energy transition

GLOBAL CALGARY-BASED Enbridge – the largest pipe- banks and Norway’s sovereign wealth fund most
line operator in North America – has said that recently have been scaling back their invest-
WHAT: it will be shifting its asset mix, pivoting away ments in the oil sands, citing the greenhouse
Pipeline operator from oil and towards natural gas and renewable gas (GHG) emissions generated by the industry.
Enbridge is gradually energy. It is far from being the only one to make This is despite the fact that oil sands producers
pivoting its asset mix such changes, as more and more oil and gas com- have sought to publicise the strides they have
towards natural gas and panies shift their focus to reflect the ongoing made in reducing emissions and environmental
renewables. energy transition. impacts from their operations.
Enbridge’s CEO, Al Monaco, told the Finan- As well as producers, these public image
WHY: cial Post this week that his company’s approach issues are affecting the operators of pipelines out
The company is making to the energy transition would be a gradual one of the oil sands, including Enbridge, which has
changes in response to and that it would continue to invest in oil pipe- seen considerable regulatory delays to its Line 3
the energy transition. lines. At the same time, though, Enbridge will pipeline replacement project.
allocate increasingly larger proportions of its
WHAT NEXT: capital expenditure to gas and renewables. Pivot
Enbridge will target new “If you look at the energy supply-demand Enbridge has assets worth around CAD170bn
opportunities in Europe balance globally, we as a company kind of mirror ($127bn), according to its latest financial state-
that align with its energy that. We have a meaningful part of our business ments. Its Mainline, which carries 2.9mn barrels
transition aims. in renewables – the base is probably 5% of our per day (bpd) of Western Canadian oil to the US,
assets,” Monaco was quoted by the Financial Post is the company’s largest single asset, illustrating
as saying. the ongoing importance of oil to its business.
Liquids pipelines currently generate around Nonetheless, in its latest investor pres-
55% of Enbridge’s earnings, while gas transmis- entation, from early June, Enbridge identifies
sion and storage accounts for roughly 40%. CAD2bn ($1.5bn) worth of growth opportuni-
Monaco’s comments come as Canadian ties beyond 2020 in liquids pipelines, compared
upstream and midstream companies continue with a combined CAD4bn ($3bn) in utilities,
to struggle with the negative public image of the gas transmission and renewables. Gas transmis-
Alberta oil sands. Foreign investors including sion accounts for CAD2bn of this, while utilities

Enbridge’s largest single
asset is its Mainline oil
pipeline, and oil will
remain important to its
business.

Week 23 11•June•2020 www. NEWSBASE .com P9