CALGARY, ALBERTA--(CCNMatthews - June 30, 2005) - Enbridge Inc. (TSX:ENB) (NYSE:ENB) announced today that its U.S. subsidiary Enbridge Offshore Pipelines, L.L.C. will extend its Gulf of Mexico pipeline infrastructure by constructing both a natural gas gathering lateral and a crude oil pipeline lateral to connect the deepwater Neptune oil and gas field to existing Gulf pipelines.
"The Neptune lateral project is another positive step in our strategy of building on Enbridge's recently acquired deepwater offshore businesses in the Gulf of Mexico," said Dan C. Tutcher, Enbridge Group Vice President, Transportation South. "It leverages existing Enbridge gas infrastructure and also represents Enbridge's first crude oil pipeline in the Gulf, positioning us to pursue other crude oil transportation opportunities in the region."
Enbridge will construct and operate both a natural gas lateral that will consist of 23 miles of 12-3/4-inch diameter pipe and an oil lateral that will consist of 23 miles of 20-inch diameter pipe. The laterals, currently estimated to cost approximately US$100 million, will have the capacity to deliver in excess of 200 million cubic feet per day of gas and approximately 50,000 barrels per day of oil.
The Neptune discovery represents a major development relatively close to Enbridge's existing Green Canyon infrastructure. The Neptune development will provide a new natural gas supply source and potential for additional supply sources for the existing Cleopatra, Manta Ray and Nautilus offshore pipeline systems, all partially owned by Enbridge. Crude oil from the Neptune development will be delivered to the existing Caesar Oil Pipeline, which connects with the Cameron Highway pipeline to Texas markets.
The Neptune field, located approximately 120 miles from the coast of Louisiana in water depths ranging from 4,200 feet to 6,500 feet, has estimated recoverable reserves in the range of 100 million to 150 million barrels of oil equivalent. BHP Billiton will be operator of the field with a 35% interest; Marathon Oil Corp. has 30%; Woodside Energy (USA) Inc., a subsidiary of Woodside Petroleum Ltd., has 20%; and Maxus (US) Exploration, a subsidiary of Repsol YPF, has 15%. Development plans, costing an estimated US$841 million, include drilling a number of subsea wells, and the wells, subsea flowlines and other production facilities will be operated by BHP Billiton on behalf of the joint venture partners.
Connection to the producer-owned production facilities is scheduled for the second quarter of 2007, with first production expected by year-end 2007.
Effective January 1, 2005, Enbridge Inc., through a wholly-owned U.S. subsidiary, acquired Shell Gas Transmission, LLC from Shell US Gas & Power LLC for US$613 million plus associated working capital. The Gulf of Mexico offshore natural gas pipeline assets, now held by Enbridge Offshore Pipelines, include ownership interests in 11 transmission and gathering pipelines in five major pipeline corridors that transport approximately 3 billion cubic feet per day. The 1,482 miles (2380 kilometres) of pipeline transport approximately half of all deepwater natural gas production in the Gulf of Mexico.
Enbridge Inc. is a leader in energy transportation and distribution in North America and internationally. As a transporter of energy, Enbridge operates, in Canada and the United States, the world's longest crude oil and liquids pipeline system. The Company also has international operations and a growing involvement in the natural gas transmission and midstream businesses. As a distributor of energy, Enbridge owns and operates Canada's largest natural gas distribution company, which provides distribution services in the provinces of Ontario and Quebec, and in New York State; and is developing a gas distribution system for the Province of New Brunswick. The Company employs approximately 4,000 people, primarily in Canada, the United States and South America. Enbridge's common shares trade on the Toronto Stock Exchange in Canada and on the New York Stock Exchange in the United States under the symbol ENB. Information about Enbridge is available on the Company's website at www.enbridge.com.
Certain information provided in this news release constitutes forward-looking statements. The words "anticipate", "expect", "project", "estimate", "forecast" and similar expressions are intended to identify such forward-looking statements. Although Enbridge believes that these statements are based on information and assumptions which are current, reasonable and complete, these statements are necessarily subject to a variety of risks and uncertainties pertaining to operating performance, regulatory parameters, weather, economic conditions and commodity prices. You can find a discussion of those risks and uncertainties in our Canadian securities filings and American SEC filings. While Enbridge makes these forward-looking statements in good faith, should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary significantly from those expected. Enbridge assumes no obligation to publicly update or revise any forward-looking statements made herein or otherwise, whether as a result of new information, future events or otherwise.