Canada's National Energy Board will allow Enbridge (T.ENB) to replace an aging pipeline across the Prairie provinces as long as the company meets 89 conditions.
The federal government must now make a decision on the project.
Enbridge wants to spend $7.5 billion to replace its Line 3 pipeline, which stretches 1,660 kilometres from Hardisty, Alta., to Superior, Wis. The pipeline is currently operating at about half capacity after the company voluntarily reduced pressure because of reliability concerns.
As part of the NEB's decision, Enbridge must develop a plan for Aboriginal groups to participate in monitoring construction. Several groups oppose the pipeline project, including First Nations and environmental groups in Manitoba and Minnesota. The company has already delayed its expected completion date from 2017 to 2019 because of the regulatory process in Minnesota.
The project will be subject to Ottawa's new environmental assessment process, announced in January.
The upgrade would enable the line to pump a maximum of 760,000 barrels per day, up from the 390,000 barrels it is currently able to move.
Enbridge shares opened Tuesday up 46 cents from Monday's close at $53.51, in a 52-week trading range of $40.03 to $65.88.
