Enbridge will add 900,000 bbl of storage at its Cheecham terminal in northern Alberta, the company announced on Wednesday, seeking to handle added bitumen production from the Surmont thermal oil sands expansion.
The company estimated the project would cost about $300 million. It will include two new 450,000-bbl blend tanks and convert an existing tank from blend to diluent service.
Enbridge will also install receipt and distribution manifolds to facilitate transfers to Enbridge's Waupisoo pipeline and upgrade associated measurement equipment, it said.
Enbridge reached agreement on the expansion with ConocoPhillips, operator of the Surmont oil sands project.
"We're pleased to further our relationship with the ConocoPhillips Surmont partnership by delivering timely and critical terminaling and transportation services that support the continued expansion of their oil sands projects," said Stephen J. Wuori, president of liquids, pipelines and major projects for Enbridge.
"We continue to work closely with our customers to develop innovative energy infrastructure solutions that meet their current and future needs, that utilize existing infrastructure and energy corridors wherever possible, and that can be built and operated safely, reliably and with respect for communities and the environment," he added.
The new infrastructure is expected to come into service in late 2014 and early 2015.
ConocoPhillips began building the 110,000-bpd Phase 2 of the Surmont project in 2010, with first production targeted for 2015. Conoco and co-owner Total currently produce about 24,000 bpd from Phase 1.