Enbridge says pipeline space adequate for new oil

By Scott Haggett

CALGARY, Alberta, Oct 3 (Reuters) - Enbridge Inc (ENB.TO) said on Wednesday it won't need to ration space on its pipelines even as output from new oil sands projects floods into the market.

The company, whose lines carry most of Canada's crude exports to the United States, said that between its lines and those planned by rivals, there will be enough pipeline capacity to ensure oil producers don't face apportionment, a rationing of pipeline space.

"We're not expecting apportionment," Richard Bird, executive vice-president at Enbridge, said at an investment conference. "There is, based on our forecast...enough capacity."

Output from new oil sands projects will boost Western Canada's oil production to 3 million barrels a day by 2010 from about 2.3 million this year, according to the Canadian Association of Petroleum Producers.

Some studies, including one from Canada's National Energy Board in July, warned that apportionment could begin by the fourth quarter of this year and last up to 18 months until new pipeline capacity is complete.

Bird said capacity will be tight to 2009, but then an expansion of the Enbridge's Southern Access pipeline and the Keystone project planned by TransCanada Corp (TRP.TO) will add more than 900,000 barrels a day of new oil export capacity.

As well, Enbridge's 450,000 barrel a day Alberta Clipper line from Alberta to Superior, Wisconsin, is expected to be complete by 2010.

($1=$1 Canadian)