Pembina Pipeline Corporation Announces Plans to Construct New Enhanced Liquids Extraction Facility in Resthaven area of Alberta
CALGARY, Oct. 13, 2011 /CNW/ - Pembina Pipeline Corporation ("Pembina") (TSX: PPL) announced that it is expanding its gas handling assets in west central Alberta. Pembina has entered into agreements to participate in a project to develop an enhanced liquids extraction facility (the "Resthaven Facility") by modifying and expanding an existing shallow cut gas plant. Once operational, the initial phase of the Resthaven Facility will have gross capacity of 200 million cubic feet per day ("mmcf/d") and 13,000 barrels per day ("bpd") of liquids extraction capability, with ultimate capacity of 300 mmcf/d. Pembina plans to construct a 44 kilometre, 6 inch diameter natural gas liquids pipeline (the "NGL Pipeline") to transport the extracted liquids from the Resthaven Facility to Pembina's Peace Pipeline, which delivers product into Edmonton, Alberta. Once completed, Pembina will own approximately 65 percent of the Resthaven Facility and will own 100 percent of the NGL Pipeline.
Pembina estimates that the Resthaven Facility, associated NGL Pipeline and storage will cost approximately $230 million (net to Pembina) and contribute annual EBITDA of $30 to $40 million (including pipeline tolls). Subject to regulatory approval, Pembina expects the new facilities to be in-service in late 2013. Pembina's investment in the Resthaven Facility is supported by long-term firm service agreements with two of the major area producers while the NGL Pipeline is underpinned by long-term firm service agreements with the Resthaven Facility owners.
The Resthaven area, located in west central Alberta, is known for its prolific liquids rich natural gas supply. "The Resthaven Facility represents a strategic step in building out our gas services business" said Bob Michaleski, Pembina's President and Chief Executive Officer. "And, as is the goal with all of our projects, this opportunity will generate additional value through integration with our conventional pipelines and midstream and marketing services."
Pembina transports crude oil and natural gas liquids produced in Western Canada, owns and operates oil sands pipelines and has a growing presence in midstream and gas services. Pembina's common shares (PPL) and convertible debentures (PPL.DB.C) are traded on the TSX.
Forward-Looking Information and Statements
In particular, this news release contains forward-looking information and statements relating to: (i) the expected in-service date of the Resthaven Deepcut Plant and the NGL Pipeline; (ii) the designed capacity of the Resthaven Deepcut Plant; (iii) the estimated cost to construct the Resthaven Deepcut Plant and associated NGL Pipeline; and (iv) industry exploration and development activity levels. These forward-looking statements are based on certain assumptions including: that the in-service date of the Resthaven Deepcut Plant and NGL Pipeline will be late 2013; that the designed capacity of the Resthaven Deepcut Plant will be 200 mmcf/d; that favourable growth parameters continue to exist in respect of current and future growth projects (including the ability to finance such projects on favourable terms); and that Pembina's businesses will continue to achieve sustainable financial results.
These forward-looking statements are not guarantees of future performance and are subject to a number of known and unknown risks and uncertainties, including, but not limited to: non-performance of agreements in accordance with their terms; the impact of competitive entities and pricing; reliance on key industry partners, alliances and agreements; the strength and operations of the oil and natural gas production industry and related commodity prices; the continuation or completion of third-party projects; regulatory environment and inability to obtain required regulatory approvals; tax laws and treatment; fluctuations in operating results; the ability of Pembina to raise sufficient capital to complete future projects and satisfy future commitments; construction delays; labour and material shortages; and certain other risks detailed from time to time in Pembina's public disclosure documents including, among other things, those detailed under the heading "Risk Factors" in Pembina's management's discussion and analysis for the year ended December 31, 2010, which can be found at www.sedar.com.
Accordingly, readers are cautioned that events or circumstances could cause results to differ materially from those predicted, forecasted or projected. Such forward-looking statements are expressly qualified by the above statements. Pembina does not undertake any obligation to publicly update or revise any forward-looking statements or information contained herein, except as required by applicable laws.
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