AEC DROPS PLAN FOR ALBERTA-U.S. CRUDE OIL PIPELINE
Alberta Energy Co. Ltd. (AEC), Calgary, has withdrawn a proposal for a new crude oil pipeline to serve markets in the U.S. Midwest.
The proposed $470 million project by AEC unit Express Pipeline Ltd., was in competition with a rival project by Interprovincial Pipelines Ltd. (IPL), Edmonton, which plans an expanded line from the Edmonton area into the Chicago market.
AEC said the Express project could not generate enough long term shippers' commitments to secure financing. It had been seeking commitments to cover shipments of 130,000-140,000 b/d of crude for 10 years.
IPL said 70% of its current shippers support a proposal to expand its existing pipeline system by 170,000 b/d at a cost of about $400 million. The two projects were to go to a National Energy Board hearing later this month. The IPL project remains subject to NEB approval.
The Express line was to run from Hardisty, Alta., to Casper, Wyo., with a possible connection to the Wood River refining area in southern Illinois near St. Louis.
AEC said there may still be a need for a pipeline similar to the Express proposal before the end of this decade.
The Canadian Energy Research Institute, Calgary, said the U.S. market potential exists, but western Canada does not have enough additional crude to support two pipeline projects (OGJ, Nov. 8, p. 36).
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