Canada’s largest pipeline company is set to build a $3.01 billion pipeline in northern Alberta. TransCanada Corp. (TSE: TRP) will work with Phoenix Energy Holdings Ltd. to transport crude from the Athabasca oilsands.
The Grand Rapids Pipeline project is destined to extend roughly 310 miles between the producing area (northwest of Fort McMurray) and the destination in Edmonton-Heartland.
The system should be operational by 2017 and will be capable of moving up to 900,000 barrels of crude each day, in addition to 330,000 barrels of diluent (naphtha or condensate used to help move the heavy crude along).
“As Alberta crude oil production continues to grow, it’s critical to have the infrastructure in place to move oil to market from emerging developments west of the Athabasca river,” TransCanada Chief Executive Russ Girling said in a statement.
TransCanada already operates the Keystone oil pipeline, which connects to the U.S. Midwest from Canada and has a 590 barrel/day capacity.
The company hopes to apply for regulatory approval for the new pipeline in 2013. It will be developed and operated by the Grand Rapids Pipeline Ltd. Partnership—a joint venture between Phoenix and TransCanada. The latter will operate the system, while Phoenix will ship oil and diluent.