Tuesday, July 6, 2010

Enbridge to spend $400 million on Wapisoo line in oil sands

CALGARY, Alta. - Enbridge Inc. said on June 28 that it plans a $400-million expansion of its Waupisoo oil sands pipeline system and is joining a carbon-capture project backed by power producers TransAlta Inc. and Capital Power Corp.
Enbridge, Canada’s No. 2 pipeline company, said producers have committed to ship another 229,000 b/d on Enbridge’s Waupisoo system, requiring a 255,000 b/d expansion of the line, which currently handles up to 350,000 barrels of oil sands crude daily.
Oil companies are again expanding operations in the oil sands region of northern Alberta, the largest oil reserve outside of the Middle East, after investment in the region dried up as commodity prices stagnated during the recession.
Suncor Energy Inc., Total SA, Imperial Oil Ltd. and others are expanding existing operations or launching new projects as oil prices firm.
The expansion of the Waupisoo system, which gathers oil from projects and delivers it to a pipeline hub near Edmonton, Alta., 236 miles south, will be done in two phases. The first 65,000 b/d tranche will be complete in the second half of 2012. Then, a 229,000 b/d expansion will be added in the second half of 2013.
The expansion firms Enbridge’s position as the largest pipeline operator in the oilsands region, gathering the oil to ship on its larger lines to the United States and Canada, and making the company a likely choice for new producers in the region.
Enbridge said increasing the size of the Waupisoo line will start adding to the company’s profits in three years.
"The Waupisoo expansion program will begin to contribute to our growth in earnings per share by 2013, and increasingly thereafter as the volumes increase to the full commitment levels," Pat Daniel, Enbridge’s chief executive, said in a statement.

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