Pembina Pipeline Corporation announced that it has approved an additional expansion of its Peace Pipeline system (Phase VIII), which will accommodate incremental customer demand in the Montney area by debottlenecking constraints, accessing downstream capacity, and further enhancing product segregation on the system. Phase VIII has an estimated capital cost of approximately USD 500M and is supported by 10-year contracts with significant take-or-pay provisions. Phase VIII is anticipated to be placed into service in stages starting in 2020 through the first half of 2022, subject to regulatory and environmental approvals.
Phase VIII will include new 10 and 16-inch pipelines in the Gordondale to La Glace corridor of Alberta, as well as six new pump stations or terminal upgrades located between Gordondale and Fox Creek, Alberta. Phase VIII will enable segregated pipeline service for ethane-plus and propane-plus NGL mix from the central Montney area at Gordondale, Alberta, into the Edmonton area for market delivery. It is expected that the majority of the USD 500M capital spending will occur in 2020 and 2021.
The Phase VIII expansion advances Pembina’s ultimate vision of having segregated liquids transportation service for ethane-plus, propane-plus, crude and condensate across at least four pipelines between Gordondale, Alberta and the Edmonton area; as well as achieving Pembina’s fully powered-up market delivery capacity of 1.3 million barrels per day across the Peace and Northern Pipelines, which could be fully realized with a Phase IX expansion, currently being engineered.