Regulator to rule on ‘abuse of market power’ complaints against Enbridge’s oil pipeline contracts

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Regulator to rule Friday on 'abuse of market power' complaints against Enbridge's oil pipeline contracts

CALGARY – The Canadian Energy Regulator is set to make a decision by end of day Friday that will affect the future of the spot market for domestic oil — and could also have major implications for both Enbridge Inc. and the country’s largest oil producers.

The decision is hotly anticipated as more than 30 companies made filings either for or against Enbridge in recent weeks. It will also settle a fracas that broke out in the oilpatch in August, when Enbridge launched an open season to call for the signing of long-term contracts on its Mainline pipeline network, which is a network of oil pipelines that move 2.85 million barrels of oil per day out of Western Canada to the U.S. Midwest and Central Canada.

In CNRL’s case, the company attempted to highlight the magnitude of the financial commitment domestic oil producers are being asked to make. Each of those four complainants have asked the CER to delay Enbridge’s contracting of the Mainline and called it an “abuse of market power” because companies are currently desperate for pipeline space.

Enbridge has argued throughout the process that an open season is a market-based process and the CER has never interfered in a market process. Those who wish to complain about the terms of the open season should do so when Enbridge applies to the CER to approve the contracts, the company said.

 

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