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Twin Ports officials support Enbridge expansion plans
Photo: Enbridge plans approximately $5 billion in expansion projects in Minnesota alone. Photo courtesy of Enbridge
The oil boom in North Dakota’s Bakken fields is frequently blamed for siphoning skilled workers from northern Minnesota. While those petroleum jobs are high paying and plentiful, the boom is creating positive economic benefits in the Twin Ports as well.
The evidence is reflected in the growing footprint that oil and natural gas transportation company Enbridge has in the Twin Ports.
According to Lee Monthei, vice president for execution of U.S. major projects, Enbridge now employs 750 FTEs at its Twin Ports facilities.
That number has grown substantially in the past few years, said Lorraine Little, company spokesperson. Six years ago, the company employed approximately 200 in the Twin Ports.
In the long run, the region could see a decline in FTEs at Twin Ports offices, but that’s not happening anytime soon – largely thanks to ongoing maintenance needs from existing infrastructure coupled with four new projects at various stages of development and regulatory review. The company’s pending and current projects are supported by officials of both cities. During a mid-March press conference, mayors Don Ness and Bruce Hagen endorsed the company’s expansion plans.
Hagen, referring to Superior as an energy capital, noted 15 percent of all imported oil passes through the city’s terminals.
“That’s a successful relationship we’ve been able to have in the Twin Ports,” he said.
“When we look at the options of how to move that crude, pipeline – in my mind – is the safest as well as requiring the least amount of carbon,” Ness said.
The backing of Twin Ports officials underscores the significant economic impact the combination of projects would have on the region.
Monthei said three planned expansions – Line 67, Line 3 and its Sandpiper project – represent an estimated $5 billion investment in Minnesota. A fourth project, the Superior Terminal upgrade, adds another $80 million to the total. Company projections suggest that the combined expansions will result in thousands of construction jobs.
An upgrade to the company’s Line 67 and the Sandpiper oil pipeline projects are both undergoing regulatory review at this time.
The Line 67 upgrade will unfold in two phases. Phase 1 would expand the pipeline’s capacity by 570,000 barrels daily (bpd) from the current level of 450,000. Phase 2 would bring the pipeline to its full design capacity of 800,000 bpd. Pending regulatory approval, Phase I construction would begin in mid-2014 and Phase 2 in mid-2015.
Phase 1 upgrades include new pumping units and other equipment at Enbridge’s Viking Station (Marshall County), Clearbrook Terminal and Deer River Station. Phase 2 will impact the company’s Donaldson Station (Kittson County), Plummer Station (Red Lake County), Cass Lake Station, Floodwood Station, Viking Station, Clearbrook Terminal and Deer River Station. The two phases of the project do not require any additional pipeline construction.
The Sandpiper Project is a 610-mile interstate pipeline that would run from Tioga, N.D. to Clearbrook, Minn., then from Clearbrook to Superior. This proposed project is new pipeline construction aimed at bringing more oil from North Dakota to refineries in the U.S. and eastern Canada. In addition to construction of a 24-inch pipeline from Tioga to Clearbrook and a 30-inch line from Clearbrook to Superior, the project would include the installation of new tanks, pumping units and metering facilities.
A final route has yet to be selected for the Sandpiper project. Becky Haase – Enbridge specialist for stakeholder relations, U.S. public affairs liquids, operations and projects – told a gathering of Iron Range officials last month that the company’s preferred route would largely follow the existing North Dakota system until it reached Clearbrook, where it would turn south toward Park Rapids then on to Superior. She described the Park Rapids corridor as “more constructible.”
Permitting for Sandpiper began last year and will continue late into 2014, according to company estimates. Construction will begin late this year, pending regulatory approval, and conclude in 2016.
The Superior Terminal expansion project will increase the storage capacity of crude oil transported through the city. The company is now in the process of constructing two 600,000-barrel-capacity tanks, which will be in service this year. Even more capacity is on the way. “There are three additional tanks that we’re going to be building in 2014,” said Monthei. “We’re just getting the contracts in place now.”
The three new above-ground storage tanks would increase capacity by 1.5 million barrels, while the two tanks under construction will provide an additional 1 million barrels of storage capacity. The two storage tanks under construction will be in service this year, while the proposed three-tank expansion is expected to be in service by 2016.
Although plans are still in preliminary stages, Enbridge also recently announced a mainline rebuild project.
The Line 3 rebuild is a $7 billion potential investment. The 1,031-mile proposed pipeline project would be the largest investment in the company’s history. It would replace existing 34-inch pipeline, constructed in 1968, from Edmonton, Alberta to Superior with a more standard 36-inch size.
Although pipelines can have an indefinite lifespan with proper maintenance, Monthei said that the coating technology used on the original Line 3 wasn’t as durable as products used both before and after. Replacing the pipeline will ultimately result in lower maintenance costs over time, said company executives.
The U.S. portion of the Line 3 replacement project will run from Neche, N.D. to Superior and carries an estimated cost of $2.6 billion. Enbridge timelines call for the new Line 3 to be operational in 2017. The new Line 3 would have a 750,000 bpd capacity, an increase from the current level of about 400,000 bpd. Although an increase from current levels, Enbridge executives note that constant maintenance needs have slowed the design capacity of the existing line.
The regulatory approval process is expected to begin later this year. A final route will be determined through that process, but the rebuild is expected to largely follow existing pipeline corridors from oil fields in Alberta to Superior.
Despite Twin Ports and regional political support, there is likely to be significant opposition. Sierra Club Staff Attorney Doug Hayes quickly followed the Enbridge Line 3 announcement with a statement condemning the company’s plan.
“Doubling the size of a pipeline that carries toxic, corrosive tar sands crude will require a full environmental review and will meet the same level of scrutiny and opposition as the other proposed tar sands pipeline projects,” he said in a written statement.
Haase told Iron Range officials last month that the company was expecting stiff opposition at Line 67 project public meetings. She urged several in attendance at the March meeting of Western Mesabi Mine Planning Board, whose members include several West Range mayors, to voice support for the projects.
Like Duluth and Superior mayors, those on the West Range are anxious to see their communities benefit from money the proposed projects would infuse into the economy.
LaPrairie Mayor Mike Fall went even further, indicating he would like to see the company reconsider its preferred route for Sandpiper, which is set to turn south before reaching the West Range.
“We want it here,” Fall told Haase.Previous Construction Articles:
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