Canadian oil storage hubs set to expand 25 pct by 2015
CALGARY, Alberta, July 22 (Reuters) - The Canadian crude oil hubs of Hardisty and Edmonton in Alberta are embarking on a major round of storage expansion that should boost capacity by about 25 percent and provide more scope for trading oil sands crude production.
According to company data and estimates from energy intelligence firm Genscape, the projects should add around 9 million barrels of capacity over the next two years.
In addition, TransCanada Corp will add an as-yet undisclosed volume of storage capacity in Hardisty once it greenlights a major eastern pipeline project.
Alberta's oil sands crude production is expected to nearly double to 3.22 million barrels per day by 2020, from 1.8 million bpd in 2012.
The lion's share of the new storage capacity - 6.6 million barrels - will be built in Edmonton, where there are salt caverns as well as above-ground storage tanks. Current capacity is estimated to be around 11 million barrels, although Enbridge Inc - the largest storage owner, according to industry intelligence group Genscape - declined to give figures.
Traditionally the smaller of the two hubs, Edmonton is attracting investment thanks to its proximity to refineries such as Imperial Oil's 187,000 bpd Strathcona facility, and pipelines running west to the coast of British Columbia, as well as south to the United States.
Edmonton is the starting point for Kinder Morgan Energy Partners LP's 300,000 bpd Trans Mountain pipeline, which the company is proposing to expand to 890,000 bpd.
"Hardisty is essentially a junction of several export lines, whereas Edmonton has more optionality because there are refineries there," said Tony Mate, director of corporate and investor communications at Inter Pipeline Fund, which owns 75,000 barrels of storage in Hardisty.