Enbridge (TSX: ENB), a leading pipeline operator, has signaled it could play a role in building a new oil pipeline from Alberta to the British Columbia coast, provided regulatory barriers are addressed. CEO Greg Ebel, speaking at CERAWeek in Houston, emphasized that while the company isn’t fully committed, it’s not a firm no, marking a subtle shift from last month’s outright reluctance.
The proposed pipeline, backed by Alberta’s government, would carry up to 1 million barrels of oil per day. Alberta Premier Danielle Smith has pushed for private-sector involvement to drive the project forward, with early support from the federal government. However, Ebel pointed out that critical conditions remain unmet, including federal approvals and the lifting of a ban on oil tankers along BC’s northern coast.
Reflecting on past setbacks, Ebel noted Enbridge’s failed attempt a decade ago to develop a similar project, which cost the company C$600 million ($435 million) before being rejected by federal authorities. “I had the rug pulled out from under us,” he said, underscoring the need for a stable regulatory framework before moving forward.
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Current discussions between Alberta and Ottawa add another layer of complexity. A memorandum of understanding on energy development, signed last year by Prime Minister Mark Carney and Smith, sets an April deadline to resolve key issues like carbon pricing and a major carbon capture initiative aimed at curbing emissions from the energy sector. Ebel highlighted that the pipeline’s fate is tied to these talks, as Canada must also ensure sufficient oil production to justify the infrastructure.
For now, no pipeline is permitted, and the path forward hinges on federal-provincial alignment. Enbridge’s cautious stance reflects a broader industry wariness, with the company keenly aware of the $435 million lesson from its past venture.
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