Enbridge Inc. (TSX:ENB) (NYSE:ENB) today confirmed the return to service of the Waupisoo Pipeline (Line 18) between its Cheecham Terminal and Edmonton and provided a further update on the latest status of its Regional Oil Sands System following the release from Line 37 pipeline on June 22nd.
The release on Line 37, which connects the Long Lake Oil sands project to Enbridge's Cheecham Terminal, is believed to have resulted from ground movement on the right-of-way as a result of recent unprecedented precipitation levels which exceeded a 1 in 100 year event. Enbridge shut down all pipelines in the area as a precaution. The southern segment of the Athabasca Pipeline (Line 19) between Cheecham and Hardisty was subsequently returned to service on June 23rd and on June 25th, the Alberta Energy Regulator approved the restart of the Waupisoo Pipeline between Cheecham and Edmonton. However, the Athabasca and Wood Buffalo pipelines between Fort McMurray and Cheecham and Line 37 remain shut down as Enbridge completes data gathering and engineering analysis of the lines.
A geothechnical analysis of the pipelines in the vicinity of Line 37 will need to completed and excavation and inspections undertaken, before these lines can safely be restarted. Heavy equipment and crews have been mobilized to the site to augment resources, but extremely wet working conditions continue to pose challenges to response efforts.
With the Waupisoo Pipeline and the southern segment of the Athabasca Pipeline back in service, Enbridge will be able to continue to transport production from the Surmont, Christina Lake and Leismer oil sands projects.
"Given the unprecedented precipitation levels affecting the area, we are going to undertake further work at the Line 37 incident location to ensure we can safely restart the other lines in the right of way," said Stephen J. Wuori, President, Liquids Pipelines and Major Projects, Enbridge. "Our priorities remain the safety of our response crews and minimizing risk to the environment, while completing the required work as quickly as can be safely accomplished in order to minimize impacts to our customers."
During the period when the other lines adjacent to Line 37 remain shut down, the loss of revenue to Enbridge's Regional and Mainline systems will have an estimated earnings impact of $1 million per day. A reliable estimate of the time required will not be available until further progress with excavation and inspection has been achieved.
The cost of containing and cleaning up the light oil released from the Long Lake lateral failure has not yet been estimated. Enbridge carries liability insurance for sudden and accidental pollution events and expects to be reimbursed for its covered costs, which is subject to a $10 million deductible.