Three proposals to expand pipeline capacity to move Western Canada’s crude oil have been stalled for years by environmental and indigenous opposition in both Canada and the United States.
Lately, the proposals have cleared several obstacles, but others remain. Canadian oil companies such as Canadian Natural Resources Ltd , Suncor Inc and Cenovus Energy say the projects are critical to lifting prices and ending government-ordered curtailments in Alberta.
This Enbridge Inc project would replace an aging pipeline that moves oil from Alberta to Superior, Wisconsin, allowing it to double capacity to 760,000 barrels per day (bpd). The Canadian portion began service in December, but Line 3 has run into obstacles in Minnesota.
The project cleared key hurdles on Monday at the state’s Public Utilities Commission, which determined that a revised environmental impact statement is adequate. The commission issued a new certificate of need.
The 67-year-old pipeline runs from Alberta to the Pacific Coast in British Columbia, giving Canadian oil ocean access to West Coast U.S. refiners and Asia. A plan to nearly triple capacity to 890,000 bpd faced so many obstacles that Kinder Morgan Inc sold it in 2018 to the Canadian government, which has been trying to get the project done ever since.
Canada’s Supreme Court removed one hurdle in January 2020, when it rejected a bid from British Columbia to regulate shipments of hazardous substances such as oil.
Construction is already under way on the project.
Canada’s Federal Court of Appeal on Tuesday dismissed a challenge to the approval by Prime Minister Justin Trudeau’s government of the Trans Mountain oil pipeline expansion.
TC Energy’s plan to build a new line connecting Alberta with Nebraska dates back more than a decade and is seen as a watershed for the environmental movement’s strategy of targeting pipelines to halt oil production growth.
The company, formerly known as TransCanada, laid out an aggressive construction schedule for 2020 and received a U.S. right-of-way allowing it to build the portion that crosses federal land.
It still faces court challenges and TC has not yet made its final investment decision to build KXL.