| CALGARY, Alberta, July 22
CALGARY, Alberta, July 22 Canada's largest
pipeline company Enbridge Inc may build a 140,000
barrel per day unit train unloading terminal in Pontiac,
Illinois, to relieve congestion on its crude oil export network.
The terminal would be able to handle two unit trains a day
and could be in service by the first quarter of 2016, according
to a filing with the Federal Energy Regulatory Commission.
Pontiac is the origin of Enbridge's new 600,000 bpd Flanagan
South pipeline to Cushing, Oklahoma, and the rail terminal would
allow shippers to bypass congestion on pipelines in the Canadian
portion of Enbridge's export network.
Enbridge Energy Partners LP, the company's U.S. arm,
is also petitioning to build a new receipt point on the network,
known as the Lakehead system, at Flanagan Illinois, which would
allow crude to be loaded from rail cars onto Flanagan South.
Enbridge spokesman Graham White confirmed an affiliate of
Enbridge is exploring the potential to establish a rail
unloading facility near Pontiac. He added the project is still
"It is expected to provide regional refineries access to
growing supplies of crude oil from North American producers and
to also provide relief during periods when upstream
apportionment prevents those barrels from moving via an
all-pipeline route," he said.
Apportionment, when the amount of crude shippers can
transport on a pipeline is rationed, is a regular source of
frustration for Canadian crude traders, who are often left
scrambling to sell barrels in Alberta as a result.
Enbridge has been rushing to expand its 2.5 million bpd
export network as surging production from the oil sands outpaces
pipeline capacity, creating crude bottlenecks in Alberta and
trading at a discount to U.S. grades.
But construction schedules and unexpected delays in securing
a presidential permit for the expansion of the cross-border
Alberta Clipper pipeline means once Flanagan South starts up
later this year, there will be mismatched capacity between the
southern and northern parts of the network.
Traders in Calgary have warned that choke points could
emerge upstream in Canada, potentially leaving unused capacity
on the downstream part of the system.
Enbridge said the proposed rail terminal would help bridge
that temporary gap.
"Enbridge now foresees the possibility that there will be a
temporary period during which the downstream pipelines will have
somewhat greater take-away capacity at Flanagan than the
upstream delivery capacity available to serve Flanagan," the
company said in its FERC filing.
(Additional reporting by Catherine Ngai in New York and Kristen
Hays in Houston. Editing by Andre Grenon)