Enbridge to invest $1.4 billion in pipeline expansion project

CALGARY - Enbridge Inc. (TSX:ENB) (NYSE:ENB), a prominent player in the Oil, Gas & Consumable Fuels industry with a market capitalization of $105.4 billion, announced Friday it has reached a final investment decision on its Mainline Optimization Phase 1 project (MLO1), with plans to increase capacity for Canadian heavy oil deliveries to U.S. refining markets.

The US$1.4 billion project will add 150,000 barrels per day (bpd) of capacity to the company’s Mainline network and 100,000 bpd to its Flanagan South Pipeline, according to a press release statement. The expanded capacity is expected to be operational by 2027. InvestingPro analysis indicates Enbridge is currently trading near its 52-week high, with shares up nearly 19% year-to-date.

The expansion will connect Canadian oil production to refineries in the U.S. Midwest and Gulf Coast regions through a combination of upstream optimizations and terminal enhancements. The company will add pump stations and make terminal improvements to increase the Flanagan South Pipeline’s capacity.

"MLO1 is expected to add capital-efficient and timely egress capacity from Canada, supporting Canadian production and increasing connectivity to the best refining markets in North America," said Colin Gruending, Enbridge’s Executive Vice President and President of Liquids Pipelines.

The Flanagan South expansion is backed by long-term take-or-pay contracts for full-path service from Edmonton, Alberta to Houston, Texas. Most existing customers have extended their contracts through the next decade following an open season process conducted earlier this year.

Enbridge will also utilize existing capacity on the Seaway Pipeline, which it jointly owns with Enterprise Products Partners L.P.

The project represents the latest infrastructure investment aimed at transporting Canadian oil resources to key U.S. markets.

In other recent news, Enbridge Inc. reported a strong second quarter for 2025, achieving record EBITDA and a significant rise in earnings per share. The company is actively expanding its infrastructure through new projects and strategic acquisitions. These developments underscore Enbridge’s commitment to growth, as highlighted in its financial results. RBC Capital responded to Enbridge’s performance by raising its price target for the company to C$72.00 from C$67.00, while maintaining an Outperform rating. This adjustment reflects confidence in Enbridge’s growth outlook, as previously communicated by the company. Investors showed cautious sentiment despite the positive financial performance, with the stock experiencing a slight decrease in premarket trading. These recent developments indicate a focus on long-term growth and strategic expansion for Enbridge.

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