Enbridge's Bakken pipeline gets Canadian approval
Enbridge Inc. President and CEO Patrick Daniel speaks to shareholders during the annual general meeting in Toronto Reuters

Canadian regulators have approved Enbridge Inc's plans to build a new C$180 million ($176 million) pipeline to move oil out of the underserved but prolific Bakken and Three Forks oilfields.

In a decision released late on Thursday, the National Energy Board said it decided there was enough commercial interest to support construction of the 123-km (76-mile) Bakken pipeline project, which will carry 145,000 barrels of oil a day from Steelman, Saskatchewan, to a link with the company's mainline system at Cromer, Manitoba.

The U.S. portion of Enbridge's Bakken project, which has yet to receive final approvals, will ship oil from North Dakota and Montana north to Steelman.

The new line will boost pipeline access for North Dakota's rapidly expanding oil industry. Output from the Bakken and Three Forks oil shale formations is climbing rapidly, with production in the state rising to 488,000 barrels per day in October, up 42 percent from October 2010.

The rapid growth has overwhelmed the capacity of the state's pipeline systems and forced producers to turn to more-expensive rail shipment to get their crude to market.

Earlier this month, Enbridge said it would spend $145 million to boost the capacity of its Berthold, N.D., crude oil terminal and build a railcar loading facility capable of handling 80,000 bpd of crude.

Enbridge expects the Bakken pipeline will be in service in early 2013.

Enbridge shares were down 30 Canadian cents at C$37.62 by late morning on the Toronto Stock Exchange.

($1=$1.02 Canadian)