By OGJ editors
HOUSTON, Aug. 25 -- Canadian Natural Resources Ltd. (CNR) let a contract to Pembina Pipeline Corp., a subsidiary of Pembina Pipeline Income Fund, to provide dedicated pipeline transportation service from CNR's Horizon Oil Sands Project 70 km north of Fort McMurray to Edmonton, Alta.
The Horizon project is designed for phased development and includes open-pit mining of bitumen combined with an onsite upgrader. Phase 1 production is planned to begin in the second half of 2008 at 110,000 b/d of 34° gravity, sweet synthetic crude oil. Phase 2 would increase production to 155,000 b/d. Phase 3 would further increase production to 232,000 b/d in 2012.
Pembina will complete the twinning of its Alberta Oil Sands Pipeline (AOSPL) by constructing 129 km of 24-in. and 30-in. pipeline loops, resulting in two parallel commercially segregated and operationally distinct pipelines.
A new 48.2-km, 20-in. pipeline from the Horizon project to the AOSPL terminal together with the existing AOSPL 22-in. pipeline will provide dedicated transportation service to CNR's Horizon project.
Total cost to complete the AOSPL looping and to construct the Northern Extension pipeline and related facilities is estimated at $290 million (Can.). Construction is expected to commence in early 2006, and the Horizon Pipeline will be fully operational and available for service by July 2008. The 24-30-in. pipeline will remain dedicated for service to Syncrude.
On completion of this project, Pembina will have committed capacity to transport 640,000 b/d of synthetic crude oil produced from oil sands.