Enhance plans Alberta carbon dioxide pipeline

Thu Jul 10, 2008 5:54pm EDT
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By Jeffrey Jones

CALGARY, Alberta (Reuters) - Enhance Energy Inc aims to spend $300 million building Alberta's first major carbon dioxide pipeline to ship the greenhouse gas to old oil fields, where it can boost output, the privately held company said on Thursday.

The pipeline will be located in central Alberta, where it will capture carbon dioxide emissions from an oil sands upgrader planned by North West Upgrading Inc and a nitrogen plant operated by fertilizer maker Agrium Inc northeast of Edmonton, Enhance said.

It will carry the gas 240 km south to mature oil fields near the central Alberta city of Red Deer.

The announcement comes two days after Alberta Premier Ed Stelmach announced $2 billion in funding for carbon capture and storage projects, a move lauded by companies and industry organizations planning to develop ways to cut emissions amid booming industrial activity.

Enhance President Susan Cole said she believes the project will be a good candidate for the government funds.

"What we have is a real project. It's an immediate project," Cole said in an interview. "It's something that we've been working on for three years now. The timing is working out to be very fortunate."

Amid heavy investment in its oil sands resources, Alberta has been criticized by some environmental groups for putting economic development ahead of environmental protection.

The Stelmach government and oil industry have recently mounted communications campaigns to combat that perception.   Continued...

<p>A truck drives down a street at Syncrude's oil tar sands operation near Fort McMurray, Alberta in this May 23, 2006 file photo. Privately held Enhance Energy Inc said on Thursday it plans to build Alberta's first major carbon dioxide pipeline system to ship the greenhouse gas to old oil fields, where it can boost output. REUTERS/Todd Korol/Files</p>