Kinder Morgan Energy Partners, L.P. (KMP) will boost the merchant storage capacity at its subsidiary Trans Mountain Pipeline's Edmonton terminal by an additional 1.2 million barrels.
In this regard, Kinder Morgan Canada Terminals has signed a long-term agreement with a major Canadian producer for the construction of the expanded facility.
Kinder Morgan, in last November, announced plans to set up seven tanks with a storage capacity of 2.4 million barrels for crude oil and condensate at the Strathcona County, Alberta-based terminal for $210 million.
With the added storage capacity, which is expected to be in service by late 2013, the investment cost now totals $284 million.
Eventually, Kinder Morgan management targets to expand the total storage capacity of the terminal to 6 million barrels and is currently in talks with various companies to ink definitive commercial agreements.
Located in Sherwood Park, Alberta the Edmonton Terminal forms the starting point of the Trans Mountain Pipeline System – the sole network of pipelines in North America that moves both crude oil and refined products to the west coast.
This expansion highlights the significance and flexibility of the Edmonton storage hub that boasts of smooth and swift connectivity among various sites in the region.
Kinder Morgan believes an upgraded Edmonton facility forms an important part in the proposed expansion plan of the Trans Mountain Pipeline System.
Currently, the Trans Mountain Pipeline System has a daily transportation capacity of 300,000 barrels. With efficient strategic planning and implementation, the capacity could be increased by another 200,000 barrels per day or more by 2017.
Kinder Morgan is one of the largest publicly traded master limited partnerships and serves as an independent owner and operator of petroleum-product pipelines in the U.S. The partnership’s general partner interest is owned by Kinder Morgan Inc. (KMI), one of the biggest mid-stream energy companies in the country.
Kinder Morgan holds a Zacks #3 Rank, which is equivalent to a Hold rating for a period of one to three months. For the long term, we maintain our Neutral recommendation on the stock.
KINDER MORGAN (KMI): Free Stock Analysis Report
KINDER MORG ENG (KMP): Free Stock Analysis Report
To read this article on Zacks.com click here.
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
Be the first to comment