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CALGARY, Alberta (Reuters) - Enbridge Inc, Canada's largest pipeline company, said on Thursday it will build a $1.3 billion extension to its Woodland crude line in northern Alberta to serve Imperial Oil's Kearl oil sands project.
The 345-kilometer (214-mile) extension will have initial capacity of 400,000 barrels per day, with the ability to be expanded up to 800,000 bpd depending on crude viscosity.
It will extend the Woodland Pipeline south from Enbridge's Cheecham terminal to its Edmonton terminal to connect with refineries and export pipelines in that area.
Imperial's recently opened Kearl oil sands project was producing around 40,000 bpd in June, according to Glenn Scott, senior vice president for resources, and is expected to reach its full 110,000 bpd capacity over the summer.
"Extension of the Woodland Pipeline will bring additional crude oil transportation capacity into the Edmonton area, enabling us to accommodate forecasted regional oil sands production growth from the Kearl project and other oil sands projects targeted for delivery into the Edmonton hub," Stephen Wuori, president of liquids pipelines and major projects at Enbridge, said in a statement.
The extended pipeline is expected to be in service by the third quarter of 2015. The Woodland pipeline between the Kearl oil sands project and the Enbridge Cheecham terminal started running in the autumn of 2012.
The majority of the proposed route will follow an existing Enbridge right-of-way and be in a shared corridor with the 600,000 bpd Waupisoo line.
Edmonton, Alberta, is close to three refineries, including Imperial's 187,000 bpd Strathcona facility, and the starting point for export pipelines running west to the coast of British Columbia as well as south to the United States.
Reporting by Nia Williams; Editing by Steve Orlofsky