Northern Gateway pipeline unlikely to start in 2018

Northern Gateway pipeline unlikely to start in 2018

Northern Gateway is set to open Alberta's oil sands industry to Asia's oil-hungry markets. (Aerial view of Kitimat, northern B.C. | Wikimedia Commons)

Enbridge Inc (TSX, NYSE: ENB), Canada's largest pipeline company, no longer expects to complete its $7.3 billion (and climbing) Northern Gateway by 2018, a company official said on Thursday.

John Carruthers, president of the firm’s Northern Gateway unit told The Globe and Mail the start date for the oil sands pipeline was “quickly evaporating.”

Speaking to a Calgary business audience, the executive added the firm was currently focused on getting support from First Nations groups along the pipeline's route through British Columbia.

Enbridge is in the process of pinning down a new cost estimate and working through 209 conditions imposed with the regulatory approval.

The controversial oil pipeline was approved last year after a regulatory review, but it only received Canada’s federal government endorsement last June.

Among the obligatory recommendations there is a requirement to use extra-thick steel during construction and maintain $950 million in liability coverage for use in the event of a rupture and spill.

Northern Gateway pipeline unlikely to start in 2018

If built, Northern Gateway would carry 525,000 barrels per day of diluted oil sands crude from Canada’s oil sands heart to a deepwater port at Kitimat, B.C., where the oil would be loaded onto tankers and shipped to Asia.