Kinder Morgan and Imperial Oil to Build Edmonton Crude Oil Rail Terminal
CALGARY--(BUSINESS WIRE)--Kinder Morgan Energy Partners L.P. (NYSE: KMP) and Imperial Oil (IMO) today announced a 50-50 joint venture to build a crude oil rail-loading facility in Strathcona County, Alberta, called the Edmonton Rail Terminal.
“The terminal will deliver additional infrastructure and options required for our distribution network and help maintain the value of Canadian crude”
The facility will be built on heavy industrial-zoned land approximately one-half kilometer southwest of Kinder Morgan’s Edmonton storage terminal, on land adjacent to Imperial’s Strathcona Refinery. The Edmonton Rail Terminal is currently being designed as a crude oil loading terminal capable of loading one to three unit trains per day totaling 100,000 barrels per day at startup, with the potential to expand to approximately 210,000 barrels per day, and ultimately to 250,000 barrels per day.
The new rail terminal will be connected via pipeline to Kinder Morgan’s tank facility and will be capable of sourcing all crude streams handled by Kinder Morgan for delivery by rail to North American markets and refineries. The rail terminal will be constructed and operated by Kinder Morgan and will connect to both Canadian National and Canadian Pacific mainlines.
“This facility underlines the importance of our expanding Edmonton terminal hub and adds to our growing crude by rail terminal network,” said Bill Henderson, vice-president for Kinder Morgan Canada Terminals. “The facility will be built with state-of-the-art technology and will incorporate extensive safety and environmental protection features, and will be manned with trained personnel around the clock. The Edmonton Rail Terminal will provide much needed near-term delivery capacity for Canadian producers and a strategic bridge to Trans Mountain’s major pipeline expansion, currently projected to be in-service in late 2017.”
The Edmonton Rail Terminal will play an important role in improving access to markets for oil sands production, said Rich Kruger, chairman, president and chief executive of Imperial Oil.
“The terminal will deliver additional infrastructure and options required for our distribution network and help maintain the value of Canadian crude,” said Kruger. “Accessing new and existing markets is critical for our continued growth and responsible development of Canada’s oil sands. The additional transportation capacity will be used for current and future production from the Kearl Oil Sands project, including the expansion phase, which will come on stream in late 2015.”
Imperial Oil will be the base load customer and has subscribed for the start-up capacity through a long-term contract. The partners are now actively marketing possible expansion capacity to potential third-party customers. Investment by the joint venture partners for the rail terminal will total approximately $170 million. In addition, Kinder Morgan will invest approximately $100 million in pipeline connections and two new staging tanks to be constructed within the Kinder Morgan Edmonton storage facility. Construction is now underway and completion is scheduled for December 2014.
About Imperial Oil
Imperial Oil is one of Canada’s largest corporations and a leading member of the country’s petroleum industry. The company is a major producer of crude oil and natural gas, Canada’s largest petroleum refiner, a key petrochemical producer and a leading marketer with coast-to-coast supply and service station networks.
About Kinder Morgan
Kinder Morgan Energy Partners, L.P. (NYSE: KMP) is a leading pipeline transportation and energy storage company and one of the largest publicly traded pipeline limited partnerships in America. It owns an interest in or operates approximately 54,000 miles of pipelines and 180 terminals. The general partner of KMP is owned by Kinder Morgan, Inc. (NYSE: KMI). Kinder Morgan is the largest midstream and the fourth largest energy company in North America with a combined enterprise value of approximately $105 billion. It owns an interest in or operates approximately 80,000 miles of pipelines and 180 terminals. Its pipelines transport natural gas, gasoline, crude oil, CO2 and other products, and its terminals store petroleum products and chemicals and handle such products as ethanol, coal, petroleum coke and steel. KMI owns the general partner interests of KMP and El Paso Pipeline Partners, L.P. (NYSE: EPB), along with limited partner interests in KMP, Kinder Morgan Management, LLC (NYSE: KMR) and EPB. For more information please visit www.kindermorgan.com.
This news release includes forward-looking statements. These forward-looking statements are subject to risks and uncertainties and are based on the beliefs and assumptions of management, based on information currently available to them. Although Kinder Morgan believes that these forward-looking statements are based on reasonable assumptions, it can give no assurance that such assumptions will materialize. Important factors that could cause actual results to differ materially from those in the forward-looking statements herein include those enumerated in Kinder Morgan’s reports filed with the Securities and Exchange Commission. Forward-looking statements speak only as of the date they were made, and except to the extent required by law, Kinder Morgan undertakes no obligation to update or review any forward-looking statement because of new information, future events or other factors. Because of these uncertainties, readers should not place undue reliance on these forward-looking statements.