Enbridge Inc.’s Line 3 project faces more delay possibilities as a regulator delayed a permit.
Minnesota regulators will conduct a longer contested process for granting the replacement and expansion of Line 3 crude-oil pipeline project to grant the project the Water Quality Certificate Permit.
The deadline was prolonged from the original August 15 to November 14.
Previously, the project has faced opposition from environmentalists and indigenous groups. The project was already been postponed by at least a year due to regulatory hurdles.
Enbridge stated that it would proceed with pre-construction activities. The company will still work with other permitting agencies to try and gain permits for the construction to start this year and is optimistic that it is able to finish the project within six to nine months after gaining the final permits.
Enbridge also expects the majority of the project’s remaining USD1.5 billion of capital spending to occur next year.
Analyst Robert Kwan of Royal Bank of Canada opined that the company’s startup target of the third quarter of 2021 is still possible but it would be more of a best-case scenario than of a target.
The Line 3 expansion project would add 370,000 bpd of shipping capacity from the Alberta oil hub of Hardisty to Superior, Wisconsin. The expansion is expected to provide relief to Canadian producers suffering from a lack of pipeline space.
