Enbridge hits three-month low as regulator rejects pipeline space plan

Canada Energy Partners

29/11/2021 18:14

** U.S.-listed and Canada-listed shares of pipeline operator
 ENB.N   ENB.TO  fall ~2% each and hit over three-month lows
    ** The Canada Energy Regulator on Friday rejected ENB's plan
to sell 90% of space on its Mainline oil pipeline under
long-term contracts, rather than rationing it on monthly basis
 urn:newsml:reuters.com:*:nL1N2SH28O
    ** CER said space plan would benefit some shippers with
contracts and harm those without contracts
    ** Co said new proposed framework for setting tolls to move
oil would also "excessively favor" those with contracts
    ** Mainline, Canada's longest oil pipeline system, moves oil
from Western Canada to refineries in Eastern Canada and U.S.
Midwest
    ** iA Capital Markets ("buy", PT: C$56) says CER's decision
creates near-term uncertainty while ENB re-enters negotiations
with shippers
    ** RBC Capital Markets ("outperform") lowers PT to C$60 from
C$61 based on the uncertainty
    ** However, brokerage says ENB's lower share price on Monday
is buying opportunity ahead of anticipated share repurchases
 urn:newsml:reuters.com:*:nL4N2RZ2Q1
    ** Separately, ENB entered carbon capture and storage
project with Capital Power Corp  CPX.TO 

 (Reporting by Ruhi Soni in Bengaluru;)
 ((Ruhi.Soni@thomsonreuters.com; Twitter: https://twitter.com/ruhithere;))