Natural gas transportation from the Montney Shale is topping Enbridge Inc.’s pipeline agenda in northern British Columbia (BC) where a slate of projects on the Westcoast Energy system could add capacity for 800 MMcf/d
After shippers over-subscribed an open season for transport service, Enbridge plans to proceed on a 300 MMcf/d addition to the southern legs of the Westcoast natural gas system, which is forecast to cost C$3.6 billion. A regulatory application is scheduled for 2024. A second open season also has begun for a 500 MMcf/d potential expansion of the northern legs of Westcoast, which is projected to cost C$1.9 billion. Both projects have 2028 completion targets.
The Westcoast system, dating back to the 1950s, has become a growth front thanks to Montney drilling, as well as the LNG Canada export project at Kitimat and the Woodfibre liquefied natural gas export terminal that Westcoast recently bought into as a partner.
“This expansion illustrates the immense strategic importance of our BC system in supplying regional and global energy demand with low-emission natural gas,” said Vice President Cynthia Hansen.
Montney production is on the rise. According to a recent survey by the Canada Energy Regulator, expansions by 46 plants have grown capacity in northeastern BC along the Alaska Highway to 9.2 Bcf/d, or 59% more than the current 5.8 Bcf/d processing volume. Pipeline capacity is poised to nearly double to 11.5 Bcf/d.
No End For Natural Gas
Retiring CEO Al Monaco described the growth in BC as confirmation that natural gas is turning out to be an environmentally favored fuel that has no obvious end.
“While global economies and energy markets are experiencing significant volatility, Enbridge's premium North America franchises, resilient commercial underpinnings, and our increasing inventory of organic opportunities put us in a great position to continue to grow into the future,” said Monaco.
“The fundamentals of our business continue to be positive; it's clear that the world needs all forms of energy to meet future demand, especially in the context of the energy security, reliability, and affordability challenges that everyone is faced with in today's environment.”
He also highlighted Enbridge’s work on LNG projects on the Gulf Coast, Western Canada and U.S. oil storage sites. Enbridge also has an Ontario distribution utility. Monaco also noted the company garnering support with Canadian Indigenous groups through a $1.12 billion pipeline partnership.
“I’m proud,” said Monaco as he wrapped up 27 years with Enbridge including the last 11 as CEO. “We've consistently grown cash flows and the dividend, delivered on our strategic priorities, and materially enhanced and diversified our asset mix by substantially increasing our natural gas footprint and low-carbon platform and capabilities.”
Enbridge, which reports in Canadian dollars (C$100/US 74 cents), earned $1.27 billion (63 cents/share) in 3Q2022, versus year-ago profits of $682 million (34 cents).
