By Robert Tuttle and Kevin Orland
“Producers are concerned that if a relative few large refiners in the U.S. control a large portion of the Mainline space, their access to customers will be limited as well as their ability to get to more diverse markets like the Gulf Coast,” Walls said in an email. “They would have less spot capacity and in the end would have to sell to the owners of the committed capacity.”
Exxon declined to comment. BP didn’t immediately respond to a request for comment.
Enbridge wants to reserve as much as 90% of space on the Mainline to companies with multiyear contracts, charging them whether they ship oil on the line or not.
The 2.8 million barrel-a-day Mainline has seen heavy rationing as surging production has run into nationwide pipeline bottlenecks. Enbridge aims to start sending contracted volumes down the line in 2021.
“The offering that we’ve got in that open season is responding to the needs of our customers and is supported by shippers representing the majority of the volume on our system,” Guy Jarvis, Enbridge’s executive vice president for liquids pipelines, said by phone.
In his objection Tuesday, Canadian Natural President Tim McKay argued that the plan disadvantages non-integrated producers in favor of “shippers who can supply their own downstream” facilities.
Separately, ConocoPhillips Canada President Kirk Johnson said the plan creates uncertainty for companies with contracts to ship on connecting pipelines such as the Flanagan South system that runs from Illinois to Oklahoma.
The plan already has drawn objections from Suncor Energy Inc., Canada’s largest integrated energy producer, as well as oil-sands driller MEG Energy Corp. and the Explorers & Producers Association of Canada, which represents small- and medium-sized producers.