Enbridge cuts Sandpiper project short

Due to a recent drop in oil prices, Enbridge Energy Partners LP, part of Canadian pipeline operator Enbridge Inc., has announced that it is calling off plans for a 616 mile pipeline. The proposed Sandpiper pipeline was originally intended to carry crude oil from North Dakota to Wisconsin.

Since North Dakota’s crude oil production is too low to support the development of the planned pipeline, Enbridge Energy Partners reported that it does not need the additional capacity, hence it is putting the US$2.6 billion Sandpiper project on hold until oil production in North Dakota “recovers sufficiently to support development of new pipeline capacity.”

The company has filed documents requesting that the state of Minnesota ends regulatory proceedings for the Sandpiper pipeline project.

In a statement, the company commented: "Enbridge Energy Partners has completed a review of Sandpiper and concluded that the project should be delayed until such time as crude oil production in North Dakota recovers sufficiently to support development of new pipeline capacity."

In early August 2016, Enbridge Energy Partners and Marathon Petroleum Corp. established a joint venture, acquiring a stake in the Bakken Pipeline system. Once this acquisition has cleared, the companies will give up their options for the Sandpiper pipeline.

The statement said that new pipeline capacity was unnecessary in North Dakota and recovery was likely outside its five year planning horizon. Instead the company is focusing its efforts on the Bakken and Dakota Access projects.

North Dakota primarily depends on rail deliveries to get oil out of the Bakken shale reserve area to regional markets. That capacity is "adequate," according to state regulators, though the state is working to expand pipeline access to the rest of North America.

Sandpiper would have stretched 616 miles, carrying 75 000 bpd, from North Dakota oil basins, through Minnesota and to an Enbridge terminal in Superior, Wisconsin and on to the US and Canadian refining markets.

"The end of the proposed Sandpiper pipeline is a crucial victory for the tens of thousands of Americans who have fought to protect their communities, their health and the climate from the threat of fossil fuel infrastructure expansion," Director of the Sierra Club Beyond Dirty Fuels, Lena Moffitt said.

"Rather than continuing to expand our reliance on fossil fuels, we must continue to transition to clean, renewable energy and leave dirty fuels in the ground," she added.

Edited from various sources by Anna Nicklin

Read the article online at: https://www.worldpipelines.com/project-news/05092016/enbridge-cuts-sandpiper-project-short/