Connect with us

Hi, what are you looking for?

Banks

Enbridge Responds to Canada Energy Regulator Decision to Deny Mainline Contracting

CALGARY, AB, Nov. 28, 2021 /PRNewswire/ – Enbridge Inc. (Enbridge or the Company) (TSX:ENB) (NYSE:ENB) today responded to the Canada Energy Regulator’s (CER) November 26, 2021 decision to deny the implementation of contracting for firm service on the Enbridge Canadian Mainline system.

Enbridge has completed its review of the decision and identified next steps that include re-engaging all stakeholders, including shippers and non-shippers on the Mainline system.

The Enbridge Mainline is a critical conduit connecting western Canadian crude oil and product supply with Canadian and U.S. Midwest markets, and ultimately the U.S. Gulf Coast. For decades, the system has provided its customers with unparalleled market access, crude oil quality management, system reliability and long-term expansion potential at the most competitive toll. Since inception of the Enbridge system in 1950, the commercial underpinning of the Mainline has evolved, from a contested cost-of-service (COS) framework to incentive rate making. Enbridge pioneered the first incentive tolling agreement with our customers in 1995, which aligned industry and Enbridge interests, and supported significant investment and expansion of the Mainline.

The most recent incentive agreement, called the Competitive Tolling Settlement (CTS Agreement), expired in June 2021; therefore, the Mainline is currently under interim tolls (subject to refund) and which will stay in effect until new tolls are approved by the CER. In 2018, in preparation for the upcoming expiry of the CTS Agreement, Enbridge initiated consultations with industry participants to determine their goals for the next Mainline tolling arrangement. Among other feedback, the Company heard significant concerns from industry over continuing Mainline apportionment, due to growing western Canadian production and lack of sufficient egress. A large portion of existing shippers expressed desire for continued toll certainty, and to contract for firm service to ensure access to the system.

However, it was also evident from extensive industry input that there was no consensus on what a new commercial structure should look like – some favoured contracting, while others opposed it altogether, preferring to maintain the status-quo, a monthly nominations process and a fixed toll. After significant negotiation with industry on a comprehensive set of terms, Enbridge applied to the CER to contract the Canadian Mainline.

In reaching its decision, the CER determined that providing firm service on the Canadian Mainline is not contrary to the CER Act.  The CER also found that elements of the application provided strong justification for some proportion of firm service on the Canadian Mainline. However, the CER denied the application on the basis that, among other things, contracting as proposed would result in a significant change to access the Canadian Mainline and potentially inequitable outcomes to some shippers and non-shippers without a compelling justification. The CER confirmed Enbridge’s existing process for downstream verification and that interim tolls would stay in effect.

Based on its review of the CER decision, Enbridge will initiate, in consultation with its stakeholders, a …

Full story available on Benzinga.com

Original Article: benzinga.com

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like

Healthcare

Scenes from the end of coal: A blasted mountaintop in Kentucky, an underground inferno in Pennsylvania, slowly dying maples in New Hampshire, and a...

Retail

Crocs has a number of shoes on sale up to 50% off including clogs, sandals, slides, flips, boots and more! Source: wral.com

Biz News

This is a commentary on the article The Top Online Business Trends for 2022 Reports OnlineBusiness.com published by 2NEWS. As the new year approaches,...

Arts & Entertainment

All around the world, the pandemic provoked strange nocturnal visions. Can they help shed light on the question of why we dream at all?...

PressRadar.com