Continuing production growth in northern liquids-rich shale deposits has prompted Pembina Pipeline Corp. to launch construction of its third natural gas processing plant scheduled for completion over the next two years.
The latest project, a C$125 million (US$94 million) plant called Duvernay 1, is forecast to start stripping up to 5,500 bbl out of 100 MMcf/d in 2017 at a site 260 kilometers (160 miles) northwest of the Alberta capital, Edmonton.
Farther west, near the Alberta-British Columbia boundary, Pembina has two comparable new plants: Musreau II, where construction was recently finished, and Musreau III with a completion target of 2016. Pipeline additions are also under way.
The third plant is named after the Duvernay geological formation, a shale layer that carpets 140,000 square kilometers (56,000 square miles) of northern Alberta and BC. The Musreau plants are named after a rich zone in the 130,000-square-kilometer (52,000-square-mile) Montney shale formation, which also straddles the two provinces.
Canadian geoscience agencies forecast the Duvernay and Montney will both turn out to be stellar produces on the scale of the Marcellus formation of the United States. Official surveys rate the resource endowments as astronomical: 449 Tcf of gas, 14.9 billion bbl of light liquids and 1.1 billion barrels of oil in the Montney, and 983 Tcf of gas, 27.6 billion bbl of liquids and 14.6 billion bbl oil in the Duvernay.
Estimates of volumes that will eventually be produced with horizontal drilling and hydraulic fracturing vary widely, but are gradually rising as Canadian industry gains experience with the technology and geology.
Pembina’s new plants are entries in a long lineup by participants in northern shale fields that include top producers and processors such as Encana, Shell Canada, Altagas, and TransCanada Corp.'s western supply grid Nova Gas Transmission Ltd.