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Enbridge puts focus on Arctic liquids
Gary Park, Petroleum News Calgary correspondent
Canadian pipeline company Enbridge is shifting its Mackenzie Delta ambitions to natural gas liquids now that TransCanada PipeLines has tightened its grip on a lead role in the C$4 billion Mackenzie Valley gas pipeline.
Pat Daniel, Enbridge chairman and chief executive officer, said May 7 his company has not been told directly that liquids shipments from the Arctic are its best bet, but its just the way we read the tea leaves today.
He told reporters that Enbridge has not given up on the Canadian project, but does feel it is more likely to be involved in carrying the associated liquids.
The company is already well-placed in that respect, through its long-established oil pipeline from Norman Wells in the central Northwest Territories to northern Alberta.
Daniel said a pipeline extension of about 300 miles from Norman Wells to the Parsons Lake or Taglu fields on the Mackenzie Delta assuming that is where the liquids are extracted would cost about C$150 million.
The liquids such as ethane, propane, butane and pentanes-plus are obtained during gas production and processing and are sold or used for enhanced oil recovery, as feedstock for refineries or petrochemical plants, or as fuels.
He noted that delta liquids production of 10,000-15,000 barrels per day could be accommodated in the existing Norman Wells line which is operating about 15,000 bpd below its capacity of 35,000 bpd. Still wants stake in Alaska gas On the larger Arctic gas development outlook, Daniel said Enbridge hopes to gain a stake in carrying North Slope gas, whether the route is overland along the Alaska Highway or under the Beaufort Sea to connect with the Mackenzie Valley system.
He said the Alaska gas, which is richer in liquids than delta gas, would be ideally suited to the Alliance pipeline from northeastern British Columbia to Chicago.
Through a series of deals over the last year with Williams Cos., El Paso and Duke Energy, Enbridge is positioned to assume joint ownership with Fort Chicago Energy Partners of Alliance, which has capacity of 1.55 billion cubic feet per day over an 1,800-mile route.
Enbridge will also gain a 42.7 percent stake by the end of this year in the Aux Sable liquids extraction plant at Chicago, although Daniel is pledged to achieve better results from the money-losing facility.
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