(Adds Enbridge quote, analyst's comment, pipeline details)
By Nia Williams
Aug 1 Enbridge Inc's new 450,000
barrel-per-day Seaway Twin pipeline, to carry Canadian oil sands
crude to North America's largest refining complex on the U.S.
Gulf Coast, will likely start operating in October, the company
said on Friday.
Enbridge, Canada's biggest pipeline company, said mid
October is most likely when the Seaway Twin will be filled with
crude from the company's new 600,000 bpd Flanagan South
Seaway Twin will carry crude from Cushing, Oklahoma, to oil
tanks near Houston, and although the pipeline was mechanically
completed in early July, it will not start operating before
Flanagan South, which will run from Illinois to Cushing, is
finished in early October.
Traders have been closely monitoring the progress of the two
pipelines, which will give Canadian oil sands producers another
direct link to the Gulf Coast.
"The plan had been, and still is, to do line fill for Seaway
Twin from Flanagan South," Guy Jarvis, Enbridge president of
liquids pipelines, said on a second-quarter earnings conference
call. "So we do not expect to see too much off Seaway Twin
before Flanagan South goes into service."
Enbridge exports the bulk of Canadian crude to the United
States on its Mainline system, which in June moved a record 2.1
Surging Canadian production and congested pipelines that
left crude bottlenecked in Alberta prompted the company to
undertake a series of expansion projects and consider building a
140,000 crude-by-rail terminal in Illinois.
Morningstar analyst David McColl said it had been a steady
quarter for Enbridge and that its massive Mainline expansion
program seemed to be progressing well.
"Enbridge has layered on C$42 billion ($38 billion) of
growth projects and is undertaking the largest extension of its
liquids pipeline system in decades," McColl said.
"They are expanding from Fort McMurray (in Alberta) to the
Gulf Coast (and) to Montreal, and so far they are doing it
Enbridge reported a stronger-than-expected profit in the
second quarter, driven mainly by higher shipment volumes on the
Mainline and on its regional oil sands systems.
The company reaffirmed its full-year adjusted earnings
forecast of C$1.84-C$2.04 a share.
Adjusted earnings rose to C$328 million, or 40 Canadian
cents a share, in the quarter ended June 30, from C$306 million,
or 38 Canadian cents a share, a year earlier.
Analysts, on average, had expected a profit of 39 Canadian
cents a share, according to Thomson Reuters I/B/E/S.
Earnings attributable to shareholders rose to C$756 million,
or 91 Canadian cents a share, in the quarter, from C$42 million,
or 5 Canadian cents a share, a year earlier.
Enbridge shares were last down 0.2 percent on the Toronto
Stock Exchange at C$53.32.
(Additional reporting by Sneha Banerjee in Bangalore; Editing
by Savio D'Souza, Simon Jennings and Peter Galloway)