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Pembina Expanding Midstream Complex in West Central Alberta

Calgary midstreamer Pembina Pipeline Corp. is launching plans to build and operate another shallow cut natural gas plant and associated pipeline infrastructure near its Cutbank Complex in west central Alberta.

The 100 MMcf/d Musreau II plant would be built near Musreau I at a cost of about C$110 million, Pembina stated. The second facility already has long-term contracts for all of its capacity with area producers. Including Musreau II, Pembina's gas processing capacity is scheduled to hit about 1.2 Bcf/d by the end of 2015.

"Musreau II will provide much needed processing capacity for our customers located in an attractive area with strong liquids-rich natural gas supply growth," said CEO Bob Michaleski. "Our ability to continue to attract such projects again demonstrates the value of our vertically integrated service offering -- volumes from Musreau II will find their way to the Redwater area via our expanded conventional pipelines."

The second facility would be designed to extract propane-plus (C3+) and yield about 4,200 b/d of natural gas liquids (NGL) for transport via Pembina's system. Musreau II could be in-service in early 2015.

Encana Corp. is one of the biggest producers in the Cutbank Ridge area, which extends into British Columbia, and it's a big Pembina customer. Last year Mitsubishi Corp. invested $2.9 billion to acquire a 40% stake in Encana's Cutbank leasehold, covering about 409,000 net acres of undeveloped Montney Shale land with additional potential in the Cadomin and Doig formations (see Shale DailyFeb. 21, 2012). An outage at the Musreau I plant earlier this year reduced Encana's production from early February through June by about 3,000 b/d (see Shale DailyJuly 26). Musreau started back up in April.

 Pembina's Gas Services business now has in operation 368 MMcf/d of net shallow cut processing capacity and 205 MMcf/d of deep cut processing capacity, with an additional 200 MMcf/d from Saturn I expected to be onstream before the end of September. Resthaven, another 200 MMcf/d facility, is scheduled to ramp up in 3Q2014, while Saturn II, which also would have 200 MMcf/d, is expected by late 2015. The company owns and operates pipelines that transport NGLs, condensate and conventional/synthetic crude oil produced in Western Canada; oilsands and heavy oil/diluent pipelines; gas gathering and processing facilities; and an infrastructure and logistics business.

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