Inter Pipeline Fund has entered into a binding agreement with Canexus Corporation to transport bitumen blend to Canexus’ unit train rail loading operations near Bruderheim, Alberta. Under the terms of the 10-year agreement, Inter Pipeline will provide Canexus with 100,000 barrels per day (b/d) of firm capacity on a new pipeline lateral from the Cold Lake pipeline system.
Inter Pipeline is a major petroleum transportation, natural gas liquids extraction, and bulk liquid storage business based in Calgary. Inter Pipeline shipped nearly 30% of Canadian crude oil supply and about 40% of oil sands volumes in 2012.
Canexus is undertaking a major expansion of its rail operations to enable loading of crude oil unit trains which will access both the Canadian Pacific and Canadian National Railway systems.
Inter Pipeline will construct a 13-kilometer, 24-inch diameter pipeline lateral from the Cold Lake pipeline system to Inter Pipeline’s Polaris pumping station near Lamont, Alberta. Bitumen blend will then be transferred to a Canexus owned pipeline for delivery to their Bruderheim rail loading facility.
Total cost for the pipeline lateral and associated metering facility is approximately $50 million. The new lateral will have an ultimate throughput capacity of 320,000 b/d, enabling Inter Pipeline to pursue additional third party bitumen blend delivery opportunities in the region.
Construction of the new pipeline lateral and metering facility will commence in August, with an expected in-service date of mid-2014.