Enbridge expresses interest in building CO2 pipeline for Canada’s Pathways project

Enbridge (TSX:ENB) is interested in building a carbon dioxide (CO2) pipeline to support Canada’s planned Pathways carbon capture and storage (CCS) project, according to recent comments made by company executives.

This comes as the federal Canadian government, the provincial government of Alberta and leading oil sands producers in the province are working to advance the project, which would be aimed at reducing emissions from the oil sands. The parties are in discussions on a number of topics including carbon pricing, financial support and permitting. They entered into a trilateral memorandum of understanding (MoU) between the federal and provincial governments and member companies of the Oil Sands Alliance in July this year. Now, they are working on translating this into definitive agreements and regulatory approvals that would move the Pathways project forward.

The parties have said previously that they are hoping to conclude talks by the middle of November. However, there have been no recent updates on progress.

Nonetheless, NewsBase Horizon believes that progress is being made behind the scenes. It is therefore unsurprising that Enbridge – one of the largest pipeline operators in North America – is following these developments and eyeing potential opportunities to serve the Pathways project.

“On the carbon pipe opportunity, yes, we are interested in that with the right risk package, obviously,” Enbridge’s executive vice president and president of liquids pipelines, Colin Gruending, said on the company’s third-quarter earnings call last week. “I think we have a lot of capabilities to bring to bear, like seven trunk lines already in that corridor. I think we're capable of building an eighth efficiently and safely,” he continued. “We have indigenous partners to the tune of 11% of that package. So, we've got a strong partner there to help attract and enable both the oil pipe and the carbon pipe solutions for industry.”

Meanwhile, Enbridge also continues to pursue other opportunities related to the oil sands. Company executives also said on the earnings call that Enbridge had sanctioned the Long Lake expansion project. This $200mn scheme entails expanding pipeline and storage infrastructure serving the Long Lake project, which is operated by China’s CNOOC International.

“It's been quiet up there for a number of years and for obvious reason,” Gruending said referring to the oil sands region. “But I think we're on the cusp of a huge cyclical and hopefully sustaining growth wave up there.”