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Not to be confused with Pembina Institute.
Pembina Pipeline Corporation
Company typePublic
TSX: PPL
NYSE: PBA
S&P/TSX 60 component
IndustryPetroleum industry
Pipeline transport Storage
FoundedSeptember 24, 1954 (1954-09-24)
Headquarters
Calgary
,
Canada
Key people
Scott Burrows President & CEO
Henry W. Sykes Chairman
ProductsEthylene and Oil Storage
Natural gas
RevenueC$6,202 mil 2020Decrease14%[1]
C$597 mil 2018 Increase20%[1]
C$1,278 mil 2018Increase45%[1]
Total assetsC$26,664 mil (Dec'18)[1]Increase4%
Total equityC$14,404 mil (Dec'18)[1]Increase4%
Number of employees
1260 (2016)[2]
DivisionsPembina Marketing Ltd
Syncrude pipeline
Horizon Pipeline
Websitewww.pembina.com

Pembina Pipeline is a Canadian corporation that operates transportation and storage infrastructure delivering oil and natural gas to and from parts of Western Canada (since 2003, storage also includes ethylene at one location). Western Canada is the source of all products transported by Pembina pipeline systems (which include the Syncrude pipeline, Horizon pipeline, and Cheecham oilsands pipelines).

Pembina Pipeline Corporation became an income fund (trust) in 1997 joining the Toronto Stock Exchange with an IPO of 600 million, and on October 1, 2010 it converted to a public corporation and changed its official name from Pembina Pipeline Income Fund to Pembina Pipeline Corporation.[3][4] As of 2016, the company had more than 1260 employees, up from 427 in 2010.[2] The company's total assets nearly doubled in 2017.[1]

History[edit]

The company can be traced back to 1954 when the Pembina pipeline system was built to serve the Pembina oil field in the Drayton Valley region. For the next 37 years, the company's main operations were centred on oil delivery to Edmonton using the Pembina pipeline.

In 1991, the company made its first acquisition with the purchase of Peace Pipe Line Ltd., and five years later it bought half of the Bonnie Glen System - a 250 km long network serving oil fields in central Alberta. Inter Pipeline Fund, the leading transporter of oilsands bitumen, was also established in 1997.[5]

Three years later in 2000, Pembina made took over Federated Pipe Lines Ltd in a $340 million deal from a group headed by Imperial Oil (Pembina needed to use a $420 million credit facility).[citation needed] After the takeover, Pembina's network in Western Canada was 7000 km long and transported nearly 550,000 b/d of oil and natural gas.[6]

On June 2, 2009 Pembina acquired the Cutbank Complex from a Talisman Energy subsidiary for $300 million in cash (provided by a credit facility).[7]

On June 24, 2003, Pembina bought 50 per cent of an ethylene storage facility in Fort Saskatchewan for $185 million from NOVA Chemicals Corp, the other 50 per cent owned by Dow Chemical Canada.[8] In 2001, Pembina sold a salt cavern in Hardisty to Canadian Crude Separators Inc., and acquired 100 per cent of the main Syncrude pipeline by taking over its operator, Alberta Oil Sands Pipeline Ltd. for $225 million. The buyout of Alberta Oil Sands Pipeline Ltd. was instrumental in Pembina's growth by giving them access to a number of large oil and gas customers, among them Imperial Oil, Conoco Oil, Nexen and Petro-Canada.[9]

In 2012, Pembina purchased Provident Energy, a Canadian company, for $3.1 billion in stock.[10] In 2017, it purchased rival energy infrastructure corporation Veresen, for $9.7 billion.[11] At the time, Veresen was primarily a natural gas transportation company, while Pembina focused on transporting oil and other liquids.

In 2019 Pembina purchased Kinder Morgan Canada Limited, along with a portion of the Cochin pipeline, for $4.35 billion.[12]

Operations[edit]

A Pembina high pressure crude oil pipeline marker

Operations are segmented into three main areas, two of them distinguished by the type of oil they transport (conventional, oil sands & heavy oil infrastructure) and the other dealing mostly with services related to storage/logistics (terminals, hubs, and midstreams) as well as marketing.[13]

Conventional Oil Infrastructure - oversees pipelines in British Columbia and Alberta that transport crude oil and NGL's. There are 2 main systems, the Alberta System and the BC System.

  • Alberta System wholly owns and runs 3 systems (all in operation since the 1950s) the largest of which is the Peace System (2009) and owns 50% of another, the Glen System (shared with Keyera Energy) and has a 10% interest in the Wabasca Oil Field System.[14] Equal Energy Ltd is one of many minor producers that use the peace pipeline, Equal's 16 wells near Grand Prairie, Alberta deliver oil to the system.[15]
  • BC System is 100% owned[by whom?], has been in operation since 1960, encompasses 3 storing facilities. The crude oil pipelines run in northeastern BC and connect Taylor to Kamloops. The total capacity is half of the smallest Alberta pipeline system (80,000 b/d in May 2009).[14]

Oil Sands and Heavy Oil Infrastructure - manages pipelines (and their associated facilities) used to transport synthetic crude from upgrading facilities. The division oversees Syncrude, Cheechan and Horizon pipelines, the last 2 relatively new (operating since 2006 and 2008 respectively). All 3 have long term contracts (over 20 years). Syncrude represents half of the total design capacity.

  • Horizon serves Canadian Natural Resources at their most important synthetic oil-producing area (the Horizon project, the contract is for 25 years).[14]

Midstream and Marketing - Pembina's storage/terminal business. 18% of revenue comes from storage and related services not connected with the Cutbank Complex and Ethylene storage.

  • Cutbank is made up of 3 gas plants (Cutbank, Musreau, Kakwa River, 9 compressor stations and a 300 km long system that gathers and processes natural gas liquids. Kakwa is 50% owned by Pembina but operated by another company.[7]
  • Ethylene Storage 50% - is an underground operation, the contract runs until 2023 and is operated by Dow Chemicals. Dow Chemicals along with Nova Chemicals Corp (the company Pembina bought its interest from in 2003) are the biggest customers.[14]

References[edit]

  1. ^ a b c d e f "Securities and Exchange Commission Form 40-F" (PDF). Archived (PDF) from the original on 14 July 2023.
  2. ^ a b "Pembina Pipeline Continues To Grow" (PDF). 2016. Archived from the original (PDF) on 2017-06-30. Retrieved 2019-03-15.
  3. ^ "Pembina Pipeline Income Fund converts to corporation". Calgary Herald. 2010-10-01.
  4. ^ "Pembina History". Retrieved 2011-01-06.
  5. ^ "Oilsands Review" (PDF). May 2008. Archived from the original (PDF) on 2011-07-07. Retrieved 2011-01-06.
  6. ^ Sharp, David J. (2006). Cases in business ethics page 238. ISBN 9781412909242.
  7. ^ a b "Pembina buys Talisman gas complex for C$300 mln". Reuters. April 29, 2009. Retrieved April 17, 2024.
  8. ^ "Pembina fund to buy half of ethylene storage facility". CBC News. 2003-05-30.
  9. ^ "Pembina Pipeline Agrees to Purchase Alberta Oil Sands Pipeline". 2001-02-01. Archived from the original on 2012-03-14. Retrieved 2018-01-06.
  10. ^ "Pembina Pipeline Buys Canada's Provident Energy for $3.1 Billion in Stock". Bloomberg News. 2012-01-16.
  11. ^ "Pembina Pipeline offers $9.7B for friendly takeover of competitor Veresen | CBC News". CBC. Retrieved 2018-02-20.
  12. ^ Orland, Kevin (August 21, 2019). "Pembina to buy Kinder Morgan Canada, U.S. portion of Cochin pipeline for $4.35 billion". Financial Post. Retrieved January 26, 2020.
  13. ^ "Our Operations". Pembina Pipeline Corporation. Retrieved 9 September 2019.
  14. ^ a b c d "Pembina Stability, Pipelines Midstream and Proposed Projects page 9 of 13". 2009-05-13.
  15. ^ "Alberta-Equal Energy Ltd". Retrieved 2011-01-06.
source: https://en.wikipedia.org/wiki/Pembina_Pipeline

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