Enbridge Inc. has entered into an agreement with Fort Hills Energy, L.P. to develop pipeline and terminaling facilities to meet the requirements of Phase 1 and subsequent phases of the Fort Hills oil sands project. Construction of the Fort Hills Project and associated pipeline facilities remains subject to final approvals by the Fort Hills' partners and various regulatory approvals and permits.
"We are pleased to have been selected by the Fort Hills partners on the strength of our operating and pipeline development experience in the oil sands region," said Patrick D. Daniel, President and Chief Executive Officer, Enbridge Inc. "The location of the project is an excellent fit with our existing facilities, and the planned execution timing aligns with the completion of our Waupisoo Pipeline and several large regional terminaling projects. The Fort Hills Pipeline project will be one of our largest projects and is expected to contribute continued earnings growth in 2011 and beyond."
The Fort Hills Project is an integrated oil sands development that includes a mine and bitumen extraction plant 90 kilometers north of Fort McMurray, Alberta, along with an upgrader in Sturgeon County northeast of Edmonton, Alberta.
The preliminary facilities plan for the Fort Hills Pipeline System includes a dedicated pipeline from the mine site north of Fort McMurray to the upgrader site in Sturgeon County, with an initial capacity of 250,000 barrels per day (bpd) of diluted bitumen. The system will also include a diluent pipeline with an initial capacity of 70,000 bpd of diluent, terminaling facilities at the mine site and Sturgeon County upgrader, and interconnecting pipelines linking the upgrader to the Edmonton pipeline hub.
The estimated cost of the pipelines and related facilities is approximately $2 billion with planned in-service dates in mid-2011, subject to finalization of scope and detailed engineering, and regulatory approvals.
Preliminary public consultation and environmental and engineering survey work is underway. Enbridge will be continuing comprehensive public and Aboriginal consultation as the project proceeds.