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Exxon and Enbridge Face Antitrust Lawsuit Over Alleged Market Exclusion Tactics

By  |  February 14, 2024

Exxon and Canada-based Enbridge, major players in the energy sector, find themselves embroiled in legal turmoil following a lawsuit filed in Illinois federal court. The lawsuit, initiated by energy infrastructure developer Ducere, alleges that the companies, along with their joint venture Mustang Pipe Line, engaged in anticompetitive behavior by blocking Ducere from constructing a terminal crucial for oil transportation.

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    According to Reuters, Ducere seeks more than $11 million in damages, citing financial losses incurred from halted project development and prospective profits. The company claims it proposed the construction of a terminal in 2020, intending to utilize Mustang’s pipeline for transporting crude via barges.

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    However, the lawsuit asserts that Exxon, holding a 70% stake in Mustang, and Enbridge, with a 30% ownership, thwarted Ducere’s efforts by preventing the terminal’s establishment.

    Related: The Case for an Exxon-Chevron Merger

    According to Ducere’s complaint, an initial agreement reached between the parties was reversed in early 2023 when Mustang’s board opted against proceeding with the terminal project. This decision, labeled as a “group boycott” by Ducere, allegedly deprived the company of access to essential infrastructure, impeding fair competition in the regional energy transportation market.

    Representatives for Exxon and Enbridge have yet to issue official statements in response to the lawsuit, as they did not immediately respond to requests for comment. The legal battle underscores the complexities and challenges within the energy sector, particularly concerning competition and market access.

    As the case unfolds in federal court, it raises broader questions about corporate dominance and fair market practices within the energy industry.

    Source: Reuters