A major Alberta project capturing carbon for enhanced oil recovery and underground storage got a big push forward on Friday.
Wolf Midstream has agreed to partner with Enhance Energy Inc. to build the Alberta Carbon Trunk Line.
The 240-kilometre pipeline will collect carbon dioxide from the Redwater Fertilizer Facility and the new Sturgeon Refinery near Edmonton and transport it to an enhanced oil recovery project near Lacombe.
Under the deal, Wolf will construct, own, and operate the CO2 capture and pipeline transportation assets.
Enhance will continue to be the owner and operator of the EOR project and carbon sequestration.
The Alberta Carbon Trunk Line will be Wolf’s second asset after the Access Pipeline, which it acquired from Devon Canada and MEG Energy in 2016 and 2018, respectively.
Construction will begin following close of the transaction, expected within 60 days. Initially, Wolf will provide midstream services only to Enhance, with other suppliers and users of CO2 having future access to its capture, compression, and transportation services.
Initial CO2 flow rates on the Alberta Carbon Trunk Line are expected to start at 800 tonnes per day in the fourth quarter of 2019, increasing to 4,400 tonnes per day by the end of 2019.
Up to $305 million in construction funding will come from Wolf’s investor, the Canada Pension Plan Investment Board. The project also has $223 million in funding from the Province of Alberta and $63 million in funding from the federal government.