Download - NEW BAKKEN MARKETS VIA PIPELINE
1
NEW BAKKEN MARKETS VIA PIPELINE
Williston Basin Petroleum Conference
May 22 to 24, 2012
Perry Schuldhaus Vice President,
Regional Pipeline Development, Enbridge Pipelines, Inc.
2
Forward Looking StatementsCertain information provided in this presentation constitutes forward-looking statements. The words "anticipate", "expect", "project" and similar expressions are intended to identify such forward looking statements. Although Enbridge believes that these statements are based on information and assumptions which are current, reasonable and complete, these statements are necessarily subject to a variety of risks and uncertainties pertaining to operating performance, regulatory parameters, economic conditions and commodity prices. You can find a discussion of those risks and uncertainties in our SEC filings. While Enbridge makes these forward-looking statements in good faith, should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary significantly from those expected. Enbridge assumes no obligation to publicly update or revise any forward looking statements made herein or otherwise, whether as a result of new information, future events or otherwise.
3
Agenda Asset Overview
Crude Oil Supply Picture
Bakken Expansion Projects
Current Crude Disposition By Market
North American Pipeline Expansions in Progress
Increasing Gulf Coast Access
Increasing Eastern Market Access
Conclusion
4
Enbridge Current Asset Structure
Geothermal
Electric
5
Bakken Supply Forecast
(Source: Enbridge internal forecast)
6
Recent Bakken Pipeline Initiatives
7
Next Major Expansion: Project Sandpiper
Superior OptionCapacity 225 – 325 KBPD
In Service Date 2015
Presidential Approval
Not Required
Regulatory Jurisdiction
U.S.
SANISH
8
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 20200
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
Bakken: The Opportunity
Production Forecast:
KBPD
Tesoro, Mandan: 68 KBPD 2013Butte Pipeline: 200 KBPD 2012
Classic: 210 KBPD 2011 Portal Reversal: 25 KBPD 2011 BEP: 120 KBPD 2013
Sandpiper: ~225 KBPD 2015
Other Pipeline Projects
Enbridge
Other Rail Projects: 748 KBPD 2014
Bentek Energy to 2016Enbridge
Rail: 80 KBPD 2013
9
FundamentalsUpper Midwest Refinery Demand Changes
Refinery Feedstock Change (kbpd)
Year Light Heavy
ConocoPhillips Wood River 2011 -130 +160
BP Whiting 2013 -260 +260
Marathon Detroit 2013 -65 +80
Total -455 +500
Source: Enbridge Internal Forecast
• Significant new heavy crude demand in the upper Midwest
• Light crude will need to find a new market
10
Crude Oil Disposition By Market
11
Text goes here• Bullet points go here
Strategic PositionEnbridge Mainline System
Competitive Advantages:
• Scale: 2.5 million bpd
• Significant potential supply growth
• Access to highest netback markets
• Well positioned for extension to new markets
• Low cost expansion
• Multiple lines: quality/reliability
Montreal
Toronto
Gretna
Regina
Hardisty
Kerrobert
Superior
Toledo
Buffalo
Edmonton
Houston
Detroit
Clearbrook
Flanagan
Fort McMurray
Cromer
Cushing
Patoka
Chicago
Wood River
Sarnia
Enbridge Inc. Enbridge Energy Partners L.P.
12
Enbridge Expanded Market Access
Norman Wells
Zama
EdmontonHardisty
Fort McMurray
Portland
Seattle
Casper
Montreal
Salt Lake City Patoka
Toledo
TorontoBuffalo
Cushing
Wood River
Houston
Superior
Chicago
Clearbrook
Regina
Ottawa
Sarnia
Flanagan
Mainline Optimization
• Gulf Coast Access Program:
– Flanagan South– Seaway reversal – Seaway twinning
• Eastern Access Program:
– New Line 79 (twins Line 17)
– Line 6B replacement segments
– Full reversal of Line 9
• Mainline Optimization:– Expand existing
Mainline System with horsepower, tanks and system optimization
– Edmonton to Chicago
EasternAccess
U.S Gulf Coast
Access
13
Text goes here• Bullet points go here
Cushing
Texas City & Port Arthur
Chicago/ Flanagan
1
Enbridge Mainline System
New Market ExtensionsU.S. Gulf Coast Access
1. Seaway Pipeline• Enbridge Inc. and Enterprise JV • First delivery to Freeport early June
2012• Initial capacity = 150 kbpd light
service• Planned capacity = 400 kbpd mixed
service• Connectivity to ECHO terminal in
2013• Connectivity to Port Arthur in 2014
Enbridge S
pearhea
d Pipeline
2
3
2. Flanagan South Pipeline• Enbridge Inc. 100%• 36 inch twin Spearhead
Pipeline• In-Service mid-2014 • Initial capacity = 585 kbpd
3. Seaway Pipeline Twin• Enbridge Inc. and Enterprise
JV • Twin Seaway Pipeline • In-service mid-2014• Initial capacity = 450 kbpd
14
Enbridge - Flanagan South
36 inch new build pipeline
Initial capacity of 585 kbpd
Expansion capability to 800 kbpd
15
Reversal of 30” Seaway in 2012 Initial Capacity of 150,000 bpd
in light service commencing June 2012
Planned capacity of 400,000 bpd in mixed service in 2013
Construction of parallel 510-mile, 30 inch diameter pipeline to be completed in mid-2014 Adds 450,000 bpd More than doubles system
capacity to 850,000 bpd
85 mile pipeline from Enterprise’s Echo terminal near Houston to Port Arthur
Seaway Reversal and Expansion
16
Crude Oil Storage Capacity
2010 2011 2012 201305
10152025
Growing Cushing Storage Capac-ity
New planned storage capacity
Cap
acity
(m
illion
bbl
s)
Contract Tankage• One of the largest
storage owner/operators at Cushing
• Long term fee based contracts
• Staggered maturities• Creditworthy
customers• Capital recovery over
initial termOperational Tankage• Manage overall system
flexibility• Return on investment
included in tolls$0.1B of capital projects underway
17
Projects Advantages Project certainty
Seaway will begin moving barrels south from Cushing in 2012
Provides needed pipeline capacity Relief of Cushing oversupply Growing Bakken and Canadian supply
Toll certainty for committed shippers No capital cost exposure
Flexible origination points and market destinations Operational storage
Enbridge Mainline, Cushing and in US Gulf Coast
18
Eastern Access – Line 9 Reversal
9A
9B
• Line 9A – Sarnia to Westover– Broadens access to the
Ontario refining market– Application before the
NEB – In-Service first half of
2013
• Line 9B– Westover to Montreal – Application to be filed in
fall of 2012– Opens access to the
Quebec refining market– In-Service spring of 2014
19
Line 9B Reversal – Open Season
• Open Season for Line 9B underway– Runs from May 17th to June 15th
• Total capacity of 240,000 bpd– 180,000 bpd for committed volumes to Montreal
– 35,000 bpd for committed volumes to Westover
– 25,000 bpd dedicated to spot volume
• Open Season information available at:
http://line9.enbridge.com/
20
Market Access for Bakken Production
Salt Lake City
Billings
Puget Sound
San Francisco
Los Angeles
Montreal
Gretna
Regina
Kerrobert
Cromer
ClearbrookSuperior
Portland
Cushing
El DoradoCoffeyville
CasperSinclair
CheyenneDenver
St. Paul
Toledo
Toronto
CatlettsburgMemphis
Robinson
Buffalo
Corpus Christi
Port Arthur
Houston Lake Charles
PhiladelphiaLima
Ardmore
Fort McMurray
Edmonton
Cheecham
Mandan
Tulsa
Hardisty
Texas City New Orleans
Kitimat
Borger/Sunray
Enbridge System
Enbridge Bakken Access
Flanagan South/Seaway Pipeline
Refineries:
Connected Carriers
New Jersey
HalifaxSaint John
Come by Chance
Wood River
Chicago
Patoka
21
Conclusion
Enhancing and developing critical infrastructure to link North American Production with US Refining Centers.
Providing increased transportation alternatives for Producers and Shippers to access key US markets.
Decreasing dependence on less secure energy supply from overseas.
Positive Impact on the US Economy.