Yahoo Finance Enbridge Cuts Tolls on Oil Pipeline System Amid New Competition
(Bloomberg) -- Enbridge Inc. cut tolls on Canadian oil export pipelines amid increased competition from a new line running from Alberta to Vancouver.
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Companies will be charged $9.4877 a barrel, down from $10.7006 a barrel, to ship heavy crude from Hardisty, Alberta, to Texas on Enbridge’s networks, Canada’s largest export system, according to company filings. The reduction happens after the start of the newly expanded Trans Mountain pipeline system, which can ship 890,000 barrels a day to the British Columbia coast, where the oil is exported mostly to the US West Coast and Asia.
The Trans Mountain Expansion, called TMX, has given Canadian oil producers an abundance of export pipelines after struggling for years with a shortage. Transporters now have the option to send oil down TMX that previously went down Enbridge’s system. Apportionment, a form of rationing, on Enbridge’s Mainline system, from Alberta to the US Midwest, has plummeted since TMX started in May and is zero for September, down from more than 20% in March.
The lack of apportionment is not unusual for this time of year, Enbridge Chief Executive Officer Greg Ebel said in an interview earlier this week. Enbridge expects to ship 3 million barrels a day this year, he said.
Enbridge’s pipelines provide access to “75% of all the refineries in the United States as opposed to TMX, which is a largely a single-market element,” said Ebel.
--With assistance from Devika Krishna Kumar and Kevin Orland.
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