Lakehead System

Kevin Warbalow Electrical Technician

“Our primary objective as electrical technicians is to efficiently maintain equipment in order to reduce system outages.”

Now in its 59^th year of operation, our Lakehead System – along with the Enbridge Inc. mainline system in Canada – continues to comprise the longest liquid petroleum pipeline system in the world. The Lakehead System, which in some areas includes up to five separate and parallel pipelines in its U.S. right-of-way, is a crude oil and liquid petroleum common carrier pipeline that serves as the primary transporter of crude oil and liquid petroleum to the United States from western Canada, supplying the major refining markets in the U.S. Great Lakes and upper Midwest as well as in Ontario, Canada. Enbridge Inc.’s Spearhead Pipeline connects with the Lakehead System near Chicago, offering shippers increased access to the Mid-Continent and Gulf Coast markets through the Cushing, Okla., Hub.

Total deliveries on the Lakehead System were up 5.0 percent in 2008 from the same period in 2007 and contributed an additional $22.8 million to operating revenue.

In 2008, Canada continued as the largest source of U.S. crude oil imports, supplying about 1.9 million barrels per day (bpd) of the U.S. crude oil import supply. Approximately 67 percent of western Canadian crude oil exports to the United States in 2008 were shipped via the Lakehead System. Of the total Lakehead System receipts, some 6.0 percent are sourced from domestic production, including increasing deliveries from our North Dakota System.

Deliveries on the Lakehead System in 2009 are anticipated to average 1.74 million bpd compared with 1.62 million bpd in 2008. Crude oil price volatility in 2008 and so far in 2009 has caused some producers to cancel or defer projects. This is likely to slow the demand for additional capacity on our Lakehead mainline system beyond the incremental increases that will be realized from our current Southern Access and Alberta Clipper expansion projects.

Enbridge also is completing an expansion of its Spearhead Pipeline, which interconnects in the Chicago area with the Partnership’s Lakehead System. When completed in early 2009, this expansion will provide increased transportation capacity – from 125,000 bpd to 193,300 bpd – into the Cushing crude oil hub.