CALGARY, ALBERTA--Enbridge Inc. and CCS Inc. today announced they have finalized a five-year crude oil storage agreement with a major crude oil producer for the use of three million barrels of underground cavern storage at Hardisty, Alberta. The facility, Hardisty Caverns Ltd., is jointly owned and operated by Enbridge and CCS. The specific terms of the agreement were not disclosed.
Enbridge and CCS will be spending in excess of $60 million CAD to develop new infrastructure at the facility, with an in-service date of late 2003.
As part of the agreement, the producer will have exclusive access to the four existing salt dome caverns, ranging in size from 600,000 to 900,000 barrels. Crude oil from a number of sources in Alberta will be stored at the facility, for eventual delivery to market through the Enbridge terminal at Hardisty.
"This agreement confirms the attractiveness of additional crude oil storage infrastructure in Western Canada as oil sands production increases over the next several years," said J. Richard Bird, Enbridge's Group Vice President, Transportation North. "The cavern storage will complement our main line crude oil pipeline system and associated terminal facilities at Hardisty, which are both currently being expanded. This new agreement is consistent with our intention to develop term storage infrastructure on a fee-for-service basis."
Enbridge and CCS formed an operating partnership in June to develop cavern facilities on property acquired by CCS in 2001.
"Customer demand from the new oil sands and heavy oil expansion projects coming on stream will require long-term planning. Based on the success of this venture, Enbridge and CCS are exploring the potential to create additional caverns at the Hardisty facility," said Dave Werklund, CCS President and CEO.
The joint Enbridge/CCS facility, scheduled to be completed by the end of 2003, will also include two new conventional storage tanks, with a combined capacity of 250,000 barrels and 1.5 km of new connecting pipelines.
The storage facilities are located adjacent to Enbridge's pipeline terminal at Hardisty.
About Enbridge
Enbridge Inc. is a leader in energy transportation and distribution in North America and internationally. As a
transporter of energy, Enbridge operates, in Canada and the U.S., the world's longest crude oil and liquids transportation system.
The Company also is involved in international energy projects and has a growing involvement in the natural gas transmission and midstream businesses. As a distributor of energy, Enbridge owns and operates Canada's largest natural gas distribution company, which provides distribution services in Ontario, Quebec and New York State; and is developing a gas distribution system for the province of New Brunswick. Enbridge employs approximately 4,000 people, primarily in Canada, the U.S. and South America. Enbridge common shares trade on The Toronto Stock Exchange in Canada and on the New York Stock Exchange in the U.S., under the symbol ENB. Information about Enbridge is available on the Company's web site at www.enbridge.com.
About CCS
CCS is a dynamic, rapidly expanding Calgary-based energy service company, operating since 1984. Through its CCS Energy Services division, the Company offers crude oil treatment, terminal services and storage in Western Canada. CCS also provides treatment, recovery and disposal solutions for oilfield by-products at 24 Canadian facilities. CCS offers drilling fluid technology and drilling services through its subsidiary ProDrill. Through its Concord Well Servicing division, which employs 39 service rigs, the Company provides well servicing in Western Canada. The CCS Income Trust Units are listed on the Toronto Stock Exchange under the symbol "CCR.UN". Information about CCS is available on the company's web site at www.ccsincometrust.com.
When used in this news release, the words "anticipate", "expect", "project", "believe", "estimate", "forecast" and similar expressions are intended to identify forward-looking statements, which include statements relating to pending and proposed projects. Such statements are subject to certain risks, uncertainties and assumptions pertaining to operating performance, regulatory parameters, weather and economic conditions and, in the
case of pending and proposed projects, risks relating to design and construction, regulatory processes, obtaining financing and performance of other parties, including partners, contractors and suppliers.
For more information please contact:
Enbridge
Ian La Couvee
Media
(403) 231-5775
Email: ian.lacouvee@cnpl.enbridge.com
Website: www.enbridge.com
or
Enbridge
Colin Gruending
Investment Community
(403) 231-5919
Email: colin.gruending@corp.enbridge.com
or
CCS Income Trust
Rene Amirault
Vice President Corporate Development
(403) 233-7565
Email: ramirault@cdncrude.com