Alberta Partners with Enbridge to Boost US Oil Exports
Alberta Premier Danielle Smith announced a partnership with Enbridge Inc (TSE: ENB) on Monday to expand pipeline capacity to the United States. This is the province’s latest push to double oil production and increase exports.
The agreement establishes a working group between Enbridge and the Alberta Petroleum Marketing Commission to streamline regulations and explore opportunities across the company’s 29,000-kilometer network. The province plans to guarantee “significant” oil volumes to encourage pipeline expansion rather than providing direct financial investment.
“We’re quite happy to negotiate with Enbridge a significant amount of barrels,” Smith said, adding that such guarantees would demonstrate the government’s commitment to pipeline development. Alberta currently exports more than 4.3 million barrels per day of crude oil to the US.
Enbridge CEO Greg Ebel said the company is exploring several hundred thousand barrels of additional capacity, primarily through existing infrastructure. “We’re not asking for dollars and cents from the government. It’s about them utilizing the pipeline systems to get the best value for Alberta,” he said.
The announcement comes as Smith plans to spend several days each month in the US this year, beginning with Trump’s inauguration, followed by visits to Texas, Louisiana and Oklahoma. The premier cited Trump’s proposed 25% tariff on Canadian imports, noting that oil purchases could provide exemptions.
The strategy marks a shift from previous pipeline support mechanisms. In 2020, Alberta invested $1.5 billion in the now-abandoned Keystone XL project with $6 billion in loan guarantees. However, past provincial guarantees have proven problematic, including a 30-year bitumen supply contract for the Sturgeon Refinery that resulted in monthly losses of $28 million by 2021.
Enbridge’s mainline system, which runs from Alberta to the US Midwest and Eastern Canada, currently transports about 3.2 million barrels daily, up from 1.5 million a decade ago.
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