Enbridge to build new oil and natural gas pipelines in Gulf of Mexico

Enbridge Inc. continues to invest in the U.S. Gulf of Mexico, announcing Thursday that it will spend about US$700 million to build new crude oil and natural gas pipelines in the gulf for the recently sanctioned Kaskida development, operated by BP Exploration & Production Co.

The crude oil pipeline, named the Canyon Oil Pipeline System, will have a capacity of 200,000 barrels per day and originate in the Keathley Canyon area of the gulf, the Calgary-based pipeline company said.

It will deliver crude to the existing Green Canyon 19 offshore platform, operated by Shell Pipeline Co. LP, for ultimate delivery to the Louisiana market.

The natural gas pipeline, named the Canyon Gathering System, will have a capacity of 125 million cubic feet per day and will connect to Enbridge’s existing Magnolia Gas Gathering Pipeline.

Detailed design and procurement activities are expected to start early next year with the pipelines expected to be operational by 2029, Enbridge said.

Enbridge has been investing heavily in the U.S. Gulf Coast in recent years as it seeks to build a strong position to meet growing global demand for energy. It already supplies natural gas to five operating liquefied natural gas (LNG) export terminals on the Gulf Coast, and also owns North America’s largest crude export terminal, the Ingleside Energy Center located near Corpus Christi, Texas.

For its part, multinational giant BP gave the go-ahead to Kaskida, its sixth hub in the Gulf of Mexico, in July. The development will feature a floating production platform with the capacity to produce 80,000 barrels of oil per day from six wells in its first phase. Production is expected to start in 2029.

“We are extremely pleased to extend an existing relationship with BP and support their new deepwater development. This opportunity diversifies our Gulf of Mexico offshore business, strengthens our significant natural gas pipeline portfolio and enhances our ability to meet the strategic needs of our customers,” said Enbridge executive vice-president Cynthia Hansen, in a news release.

This report by The Canadian Press was first published Oct. 3, 2024.