CALGARY - Enbridge said Thursday that its Line 3 pipeline replacement program is progressing well, even as it faces intense scrutiny on the project in Minnesota.
CEO Al Monaco said on a third-quarter earnings call that the company is making good progress on the line, with construction already underway in Canada and Wisconsin and the project expected to be finished in mid-2019.
Regulators in Minnesota, however, continue to review the project and have issued several rulings with which the company disagrees.
Last week, the Public Utilities Commission ruled Enbridge must publicly disclose its projections for potential oil spills on the line, including the probability of large spills at seven water crossings.
The company had already submitted the data as part of an environmental impact statement, but had the information redacted from the public version over what it said were concerns that the data could be used by those looking to damage the line.
Protests against the line are also increasing in the state, with the commission cancelling two public hearings last week over what it said were logistical and safety issues after protesters disrupted a hearing on the project a week earlier.
In September, the Minnesota Department of Commerce said the company had failed to establish the need for its pipeline to be replaced, and that it might be better to shut down the existing line.
Enbridge disagreed with the finding, and on Thursday's earnings call Monaco emphasized the importance of the line.
"Line 3 is a key piece of infrastructure that supplies the U.S. Midwest and Gulf Coast markets, and ultimately it's critical in maintaining low gasoline prices for Americans."
Enbridge said the Minnesota Public Utilities Commission is expected to rule on the adequacy of the project's environmental impact statement in December, and on the certificate of need and route permits in the second quarter of 2018, which could clear the way for completion of the line a year later.
The replacement project, with an estimated capital cost of $5.3 billion in Canada and US$2.9 billion for the American stretch, is designed to replace the aging 1,660-kilometre pipeline running between Hardisty, Alta. and Superior, Wis.
With pipeline projects encountering greater resistance, Monaco said that industry is getting more cautious about where it commits money and will likely look to share more of the risk with shippers going forward.
"Putting capital at risk in uncertain environments is something that we're going to be very cautious about, and I'm pretty sure the other pipeline midstream companies would tell you the same thing."
"I think we've probably seen a switch in the industry over the last few years, where we're going to have to have a proper sharing of the risk before we actually get regulatory permits," said Monaco.
Enbridge said that on an adjusted basis, it earned $632 million or 39 cents per share for the quarter compared with an adjusted profit of $437 million or 47 cents per share a year ago. Revenue in the quarter amounted to $9.23 billion, up from $8.49 billion.
The company said the largest driver of growth for the quarter were the natural gas, liquids and utility assets acquired in its takeover of Spectra Energy earlier this year.
Enbridge also said it plans to file an application with the Ontario Energy Board to merge its Enbridge Gas Distribution Inc. and Union Gas Ltd. operations.