CALGARY, Alberta, July 10 (Reuters) - Inter Pipeline Ltd , which operates regional pipeline systems in Western Canada, said on Thursday it plans a C$100 million ($94 million) expansion of its oil lines in Saskatchewan to add 95,000 barrels per day of new capacity.
Inter Pipeline said it has signed contracts with five producers that have committed to ship oil on the lines. In all, the company will add 90 kilometers (56 miles) of new pipelines to its Saskatchewan system and expects the first phase of the expansion to be in service later this year and fully complete by mid 2015.
Oil production in Saskatchewan has been rising as producers tap the northern edge of the prolific Bakken field and use horizontal wells and fracking to exploit the province's other oil reserves. Inter Pipe said volumes on its system in the province have doubled over the past two years to 70,000 bpd.
The company said it expects the expansion to boost cash flow by between C$25 million and C$30 million a year.
Inter Pipeline shares were up 6 Canadian cents at C$32.45 at midday on the Toronto Stock Exchange.
($1=$1.06 Canadian) (Reporting by Scott Haggett; Editing by Peter Galloway)
- Commodity Markets
- Inter Pipeline Ltd