Inter Pipeline Announces New Conventional Oil Pipeline Project
CALGARY, Aug. 7, 2019 /CNW/ - Inter Pipeline Ltd. ("Inter Pipeline") (TSX: IPL) announced today that it has received commercial support for the construction of a $100 million pipeline connection between its Bow River and Central Alberta pipeline systems. The new pipeline, called the Viking Connector, will link various grades of light crude oil from the Viking and Mannville formations in east-central Alberta to the Edmonton market hub.
"The Viking Connector enables us to cost effectively leverage our extensive regional pipeline network and provide customers with superior market access," said Christian Bayle, President and Chief Executive Officer of Inter Pipeline. "Producers in the Alberta Viking and surrounding plays are currently limited to pipeline services to the Hardisty hub or costly trucking alternatives. This connection will provide economical access to the Edmonton market hub which historically has been a premium market for Alberta light oil products, a clear benefit for producers."
This $100 million investment is the second phase of a multi-phased development program for the Central Alberta pipeline system. This phase includes the construction of 75 kilometers of eight-inch diameter pipeline that will connect Inter Pipeline's Throne Station on the Bow River pipeline system to the Central Alberta pipeline system in the Stettler area. In addition, Inter Pipeline will complete upgrades to the Throne Station, which includes reconfiguring existing tank storage and expanding truck offloading capacity. Construction will begin immediately and is expected to be completed in the first half of 2020.
When completed, Inter Pipeline forecasts throughput volume of 10,000 to 15,000 barrels per day (b/d) on the Viking Connector, with approximately one third of forecast shipments currently secured for a 10-year term. Additional term transportation agreements are under negotiation and contracted commitment levels may rise by the in-service date.
Phase one of the Central Alberta development program, which commenced in late 2017, includes the conversion of the pipeline system to multi-product batch operation, and construction of additional truck offloading and tank storage capacity at the Stettler Station. Batch operations began in mid-2018 and an additional 10,000 b/d of truck unloading capacity is expected to enter service in the fall of 2019. Two new 130,000 barrels storage tanks, the final component of phase one, are expected to be complete by the spring of 2020. Further phases may be required over the next several years to support additional production growth.
Inter Pipeline is a major petroleum transportation, natural gas liquids processing, and bulk liquid storage business based in Calgary, Alberta, Canada. Inter Pipeline owns and operates energy infrastructure assets in western Canada and Europe. Inter Pipeline is a member of the S&P/TSX 60 Index and its common shares trade on the Toronto Stock Exchange under the symbol IPL.www.interpipeline.com
Certain information contained herein may constitute forward-looking statements that involve known and unknown risks, assumptions, uncertainties and other factors. Forward-looking statements in this news release include but are not limited to thetiming, cost and anticipated benefits of the Viking Connector project (including volume forecasts, additional contract commitments and development of further phases). Readers are cautioned not to place undue reliance on forward-looking statements, as such statements are not guarantees of future performance. Inter Pipeline in no manner represents that actual results, levels of activity and achievements will be the same in whole or in part as those set out in the forward-looking statements herein. Such information, although considered reasonable by Inter Pipeline at the time of preparation, may later prove to be incorrect and actual results may differ materially from those anticipated in the statements made. For this purpose, any statements that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements often contain terms such as "may", "will", "should", "anticipate", "expects" and similar expressions. Such assumptions, risks, uncertainties and other factors include, but are not limited to, risks and assumptions associated with operations, such as Inter Pipeline's ability to successfully implement its strategic initiatives and achieve expected benefits, including the further development of its pipeline systems and other facilities; assumptions concerning operational reliability; Inter Pipeline's ability to maintain its investment grade credit ratings; the availability and price of labour, equipment and construction materials; the status, credit risk and continued existence of customers having contracts with Inter Pipeline and its affiliates; availability of energy commodities; volatility of and assumptions regarding prices of energy commodities; competitive factors, pricing pressures and supply and demand in the oil and gas transportation, natural gas liquids processing and storage industries; assumptions based upon Inter Pipeline's current guidance; fluctuations in currency and interest rates; inflation; the ability to access sufficient capital from internal and external sources; risks and uncertainties associated with Inter Pipeline's ability to maintain its current level of cash dividends to its shareholders; risks inherent in Inter Pipeline's Canadian and foreign operations; risks of war, hostilities, civil insurrection, instability and political and economic conditions in or affecting countries in which Inter Pipeline and its affiliates operate; severe weather conditions; terrorist threats; risks associated with technology; Inter Pipeline's ability to generate sufficient cash flow from operations to meet its current and future obligations; Inter Pipeline's ability to access external sources of debt and equity capital; general economic and business conditions; the potential delays of and costs of overruns on construction projects, including, but not limited to Inter Pipeline's current pipeline, petrochemical, NGL processing and terminal storage projects and future expansions of Inter Pipeline's assets; risks associated with the failure to finalize formal agreements with counterparties in circumstances where letters of intent or similar agreements have been executed and announced by Inter Pipeline; Inter Pipeline's ability to make capital investments and the amounts of capital investments; changes in laws and regulations, including environmental, regulatory and taxation laws, and the interpretation of such changes to Inter Pipeline's business; the risks associated with existing and potential or threatened future lawsuits and regulatory actions against Inter Pipeline and its affiliates; increases in maintenance, operating or financing costs; availability of adequate levels of insurance; difficulty in obtaining necessary regulatory approvals or land access rights and maintenance of support of such approvals and rights; the timing, financing and completion of acquisitions and other projects Inter Pipeline is developing; the realization of the anticipated benefits of acquisitions and other projects Inter Pipeline is developing; and such other risks and uncertainties described from time to time in Inter Pipeline's reports and filings with the Canadian securities authorities. The impact of any one assumption, risk, uncertainty or other factor on a particular forward-looking statement cannot be determined with certainty, as these are interdependent and Inter Pipeline's future course of action depends on management's assessment of all information available at the relevant time. You can find a discussion of those risks and uncertainties in Inter Pipeline's securities filings at www.sedar.com. Readers are cautioned that the foregoing list of assumptions, risks, uncertainties and factors is not exhaustive. The forward-looking statements contained in this news release are made as of the date of this document, and, except to the extent required by applicable securities laws and regulations, Inter Pipeline assumes no obligation to update or revise forward-looking statements made herein or otherwise, whether as a result of new information, future events, or otherwise. The forward-looking statements contained in this document and all subsequent forward-looking statements, whether written or oral, attributable to Inter Pipeline or persons acting on Inter Pipeline's behalf are expressly qualified in their entirety by these cautionary statements.