CALGARY, A.B. – Pembina Pipeline Corporation has announced that it has approved an additional expansion of its Peace Pipeline system.
Pembina says this system will accommodate incremental customer demand in the Montney area by debottlenecking constraints, accessing downstream capacity, and further enhancing product segregation on the system.
According to Pembina, phase eight of the system has an estimated capital cost of approximately $500 million and is supported by 10-year contracts with significant take-or-pay provisions.
The Corporation is anticipating phase eight to be placed into service in stages starting in 2020 through the first half of 2022, subject to regulatory and environmental approvals.
President and CEO of Pembina, Mick Dilger, says the system expansion will allow Pembina to deliver timely and reliable transportation service solutions for their customers, adding that they are pursuing development with a long-term outlook.
“Our strategic footprint continues to provide opportunities to complete staged expansions, enabling us to deliver timely and reliable transportation service solutions for our customers. Our customers continue to recognize the favourable economics in the Deep Basin and Montney areas and like us are pursuing development with a long-term outlook. Further, they appreciate the new markets we are developing such as the Prince Rupert Export Terminal and the proposed PDH/PP facility.”
Phase eight will include new 10 and 16-inch pipelines in the Gordondale to La Glace corridor of Alberta, as well as six new pump stations or terminal upgrades located between Gordondale and Fox Creek, Alberta. Phase VIII will enable segregated pipeline service for ethane-plus and propane-plus NGL mix from the central Montney area at Gordondale, Alberta, into the Edmonton area for market delivery.
It is expected that the majority of the $500 million capital spending will occur in 2020 and 2021.
Pembina says this expansion advances their ultimate vision of having segregated liquids transportation service for ethane-plus, propane-plus, crude and condensate across at least four pipelines between Gordondale, Alberta and the Edmonton area. As well as achieving fully their powered-up market delivery capacity of 1.3 million barrels per day across the Peace and Northern Pipelines, which could be fully realized with a phase nine expansion, currently being engineered.