Calgary-based pipeline transport company Enbridge is seeking U.S. approval to increase the capacity of a pipeline carrying crude from Alberta to Wisconsin, according to the company's CEO Al Monaco.
He believes that the process would meet fewer obstacles than TransCanada has faced in its struggle to gain approval for its Keystone XL pipeline, because the situation is quite different. The Alberta Clipper pipeline's capacity could be increased without the need to lay any new pipes, which could help the company receive approval easily. Currently, the pipeline carries about 450,000 barrels per day and Enbridge wants to boost this to 800,000 barrels per day by 2015. In order to do so, the company plans to add new pumping equipment that will be able to handle the increase and the expansion would have very little environmental impact, Monaco told attendees at a meeting to discuss the company's first-quarter results.
In the case of Keystone XL, construction of the pipeline will be started from scratch and it involves building a new pipe across the United States. One of the main hurdles is going through Nebraska, where TransCanada had to change the route of the pipeline in order to ensure that ecological damage was not done to certain sensitive areas. TransCanada hopes that approval for the works will be granted by President Obama later this year, following a number of delays.
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In Enbridge's case the Alberta Clipper already has a presidential permit and the company is only trying to amend it. There could not be any questions regarding routes, as the pipe is already in place. Instead Enbridge is just looking to add some station work, Monaco explained. However, he acknowledged that the expansion project might become the center of attention for environmental groups.
Environmentalists believe that building pipelines like Keystone XL would encourage development of Alberta's oilsands, which they see as an excessively dirty source of oil, CBS Canada said.
Meanwhile, Enbridge revealed that its first-quarter adjusted earnings exceeded expectations but said that this rate of growth is likely to drop over the coming quarters. The company posted adjusted earnings of CA$488 million, or 62 cents per share, which was 10 cents per share higher than the average analyst estimate. By comparison, over the same period in 2012 Enbridge reported earnings of CA$373 million, or 49 cents per share. Net earnings came in at CA$250 million, or 31 cents per share, compared with CA$261 million, or 34 cents per share, 12 months earlier. Revenue for the first quarter totalled CA$8.02 billion, up from CA$6.63 billion in the same period in 2012.
