STONY MOUNTAIN PIPELINE PROJECT DESCRIPTION DOCUMENT · A bore hole is drilled under the water body...

STONY MOUNTAIN PIPELINE

PROJECT DESCRIPTION DOCUMENTFEBRUARY 2012

LARICINA ENERGY LTD.

01 STONY MOUNTAIN PIPELINE

Laricina will develop and follow an environmental protection plan that meets or exceeds regulatory requirements and industry standards.

Aboriginal and public consultation process

Application preparation

Application filing

Regulatory review

Engineering

Blended crude bitumen pipeline – Construction

Start-up

Diluent pipeline – Construction

Start-up

Final clean up

About Laricina Energy

Laricina Energy Ltd. (Laricina) is a privately held, Calgary-based company that is creating value by developing Canada’s oil sands using innovative in situ technologies.

Laricina has a portfolio of targeted oil sands assets containing a variety of reservoir environments and geological character. These assets range from the familiar oil sands of the McMurray Formation to the developing Grand Rapids and Grosmont Formations, all of which offer significant resource potential. Laricina’s diverse portfolio of oil sands assets are at varied stages of development.

Development is underway at Saleski and Germain, Laricina’s two core properties in the West Athabasca Oil Sands region. At Saleski an 1,800 barrels per day (bpd) pilot project is in operation and at Germain a 5,000 bpd commercial demonstration project is under construction.

Laricina is a responsible energy company that will respond to the growing demand for crude oil through in situ oil sands development.

Stony Mountain Pipeline

Laricina proposes to construct a new 24-inch, 184 km blended crude bitumen pipeline to transport production from its Saleski Steam-Assisted Gravity Drainage (SAGD) development, located in the West Athabasca Oil Sands region of Alberta, to the Enbridge Pipelines Inc. (Enbridge) Cheecham Terminal, located approximately 70 km south of Fort McMurray. A second 12-inch diluent pipeline is planned for the same right of way. Diluent is a light petroleum liquid used to dilute bitumen and heavy oil so it can be shipped through a pipeline to domestic and export markets.

Laricina is currently planning to install the two pipelines along with required tankage and associated facilities over two winter seasons in order to manage project timing and meet business commitments. The initial capacity of the blended crude bitumen pipeline, scheduled for completion in mid-2015, will be 200,000 bpd. The initial capacity of the diluent pipeline, scheduled for completion in 2016, will be 70,000 bpd. To mitigate the impact on environmentally sensitive areas, the proposed pipelines are routed south of both the Grand Rapids and Stony Mountain Wildland Provincial Parks commencing from Laricina’s Saleski lease located at Townships 84 and 85 and in Ranges 19 and 20 W4M (approximately 70 km northeast of Wabasca, Alberta) to Enbridge’s Cheecham Terminal located at 06-08-084-06 W4M. (See map on page 3).

Laricina has named this development the “Stony Mountain Pipeline”.

Environmental Steward- ship, Health and Safety

Laricina is committed to carefully assessing and mitigating potential impacts on the environment, to considering socio-economic issues related to the pipeline and to protecting the health and safety of Aboriginal communities, the public, contractors and our employees. The commitment to stakeholders is to ensure facilities are designed, constructed and operated with these results in mind.

We will seek input from those who may be affected by construction activities and will work together to address their concerns early in the process as we work through the regulatory process for the Stony Mountain Pipeline. Through studies and ongoing dialogue with Aboriginal communities, regulatory agencies and other stakeholders, we will identify the potential effects the pipeline may have on the various land, air, fish, bird, wildlife and freshwater environments along the route and will utilize existing and proven mitigation measures during construction and operations.

Laricina will develop and follow an environmental protection plan that meets or exceeds regulatory requirements and industry standards. Construction work will be conducted in accordance with Laricina’s environmental, health and safety standards. Prior to going into service, the pipeline will undergo a rigorous inspection process to ensure that it is safe for use. The pipeline will be operated in an environmentally safe and responsible manner.

A bore hole is drilled under the water body and the pipeline is then pulled back through the bore hole to the other side.

direction of pipeline pull

sectionof pipeline

HDD rig

Horizontal Directional Drilling (HDD)HDD is an established and extensively-used pipeline boring technique which is particularly effective for water crossings.

Pipeline Need

As new in situ projects are being developed, additional pipeline capacity is required out of the West Athabasca Oil Sands region. Laricina is currently operating a pilot at Saleski which has an approved 1,800 bpd capacity. Regulatory approval for the Phase 1 – 10,700 bpd expansion at Saleski is being sought which will increase the proposed production capacity to 12,500 bpd. Phase 1 will be the first of six expansion phases expected to increase Saleski’s production to more than 270,000 bpd over a 30-year period.

While pilot production is currently being trucked to market, the increased production from the planned expansion at Saleski will require a connection to existing pipeline infrastructure. The Stony Mountain Pipeline will initially serve Saleski, however, it is expected that other neighbouring projects may also use the pipeline.

To meet the full development potential of Saleski and other potential neighbouring projects, the initial pipeline capacity of 200,000 bpd will need to be expanded in the future. Expansion options will be considered in the context of balancing overall operational requirements with protecting sensitive environments and mitigating new land disturbance.

Preliminary Route Selection

Laricina’s preliminary route planning and selection for the pipeline has undergone careful consideration consisting of desktop reviews of topographical maps, land use and tenure information and land disturbances in the vicinity of the region, as well as route and site inspection by helicopter.

Our primary pipeline route selection is founded on our commitment to manage potential impacts to wildlife and to the local environment, through mitigation, both during and following construction activities. Route selection criteria included the environment, construction cost and timing, existing linear disturbances, river crossing feasibility and right of way reclamation.

As the Athabasca River crossing is a critical control point for the overall pipeline routing, Laricina conducted a preliminary assessment of the proposed crossing location in spring 2011. A geotechnical borehole investigation was executed during June and July 2011 and through this investigation Laricina determined that a horizontal directional drill (HDD) under the Athabasca River was a viable crossing option. Using HDD for pipeline crossings of roads, rivers and other obstacles is an established and commonly used technique.

Additional geotechnical investigations will be conducted at the Athabasca River, and other watercourse crossings along the proposed route, as warranted, to gather the information required to ensure the pipeline is installed in a manner that minimizes potential impacts to the environment.

Development of the proposed pipeline is contingent upon receiving regulatory approvals. Laricina will consult with regulators, Aboriginal communities, stakeholders, and land users on routing.

02

1985

84

21

ClearwaterRiver

Grand Rapids

BovinCreek

Wildland Park

Fort McMurray

REGIONALMUNICIPALITY

OF WOOD BUFFALO

MUNICIPALDISTRICT OF

OPPORTUNITY NO. 17

LAC LABICHE

COUNTY

Grand RapidsWildland Park

Crow LakeProvincial Park

Crow LakeEcologicalReserve

Engstrom LakeProvincial

Recreation Area

StonyMountainWildland

Park

Maqua LakeProvincial

Recreation Area

HangingstoneProvincial

Recreation Area

Gregoire LakeProvincial Park

Gipsy - GordonWildland Park

Gipsy LakeWildland Park

Gregoire/WillowLake Expansion

N

89

90

88

87

86

85 91112131415161718

86

87

88

89

8 7 6 5 4

84

83

82

81

80

7979

78

77

Clearwater175

GregoireLake 176

Janvier194

Cheecham

Figure 1Regional LocationOf the ProposedLaricina Saleski

to Cheecham Pipeline

National/Provincial

Environmentally Significant Areas

LEGEND

First Nations Land

Proposed Conseration or Recreation Area

Park or Protected Area

City/Town

Municipal Boundary

Waterbody

Watercourse

Railway


Kilometre Post

Highway

0 5 10 15 20

SCALE: 1: 500,000

(All Locations Approximate)

km

August 2011

7478

63

881

63

63

Athabasca River

Ath

abas

ca R

iver

Saleski

KP 184

KP 180

KP 170

KP 160

KP 150KP 140KP 130

KP 80KP 70

KP 120KP 110KP 100

KP 90

KP 50

KP 0

KP 60

KP 40

KP 30

KP 20

KP 10

Development of the proposed pipeline is contingent upon receiving regulatory approvals. Laricina will consult with local regulators, Aboriginal communities, stakeholders and land users on routing.


LEGEND

Kilometre Post

Proposed Stony Mountain Pipeline

Highway

Railway

Watercourse

Waterbody

Municipal Boundary

City / Town


Proposed Conservationor Recreation Area

First Nations Land

05 10 15 20

SCALE: 1: 500,000km

04

1985

84

21

ClearwaterRiver

Grand Rapids

BovinCreek

Wildland Park

Fort McMurray


OF WOOD BUFFALO


OPPORTUNITY NO. 17

LAC LABICHE

COUNTY





Recreation Area


Park


Recreation Area


Recreation Area





N

89

90

88

87

86

85 91112131415161718

86

87

88

89

8 7 6 5 4

84

83

82

81

80

7979

78

77

Clearwater175

GregoireLake 176

Janvier194

Cheecham



National/Provincial


LEGEND

First Nations Land



City/Town

Municipal Boundary

Waterbody

Watercourse

Railway


Kilometre Post

Highway

0 5 10 15 20

SCALE: 1: 500,000


km

August 2011

7478

63

881

63

63

Athabasca River

Ath

abas

ca R

iver

Saleski

KP 184

KP 180

KP 170

KP 160

KP 150KP 140KP 130

KP 80KP 70

KP 120KP 110KP 100

KP 90

KP 50

KP 0

KP 60

KP 40

KP 30

KP 20

KP 10

1985

84

21

ClearwaterRiver

Grand Rapids

BovinCreek

Wildland Park

Fort McMurray


OF WOOD BUFFALO


OPPORTUNITY NO. 17

LAC LABICHE

COUNTY





Recreation Area


Park


Recreation Area


Recreation Area





N

89

90

88

87

86

85 91112131415161718

86

87

88

89

8 7 6 5 4

84

83

82

81

80

7979

78

77

Clearwater175

GregoireLake 176

Janvier194

Cheecham



National/Provincial


LEGEND

First Nations Land



City/Town

Municipal Boundary

Waterbody

Watercourse

Railway


Kilometre Post

Highway

0 5 10 15 20

SCALE: 1: 500,000


km

August 2011

7478

63

881

63

63

Athabasca River

Ath

abas

ca R

iver

Saleski

KP 184

KP 180

KP 170

KP 160

KP 150KP 140KP 130

KP 80KP 70

KP 120KP 110KP 100

KP 90

KP 50

KP 0

KP 60

KP 40

KP 30

KP 20

KP 10

1985

84

21

ClearwaterRiver

Grand Rapids

BovinCreek

Wildland Park

Fort McMurray


OF WOOD BUFFALO


OPPORTUNITY NO. 17

LAC LABICHE

COUNTY





Recreation Area


Park


Recreation Area


Recreation Area





N

89

90

88

87

86

85 91112131415161718

86

87

88

89

8 7 6 5 4

84

83

82

81

80

7979

78

77

Clearwater175

GregoireLake 176

Janvier194

Cheecham



National/Provincial


LEGEND

First Nations Land



City/Town

Municipal Boundary

Waterbody

Watercourse

Railway


Kilometre Post

Highway

0 5 10 15 20

SCALE: 1: 500,000


km

August 2011

7478

63

881

63

63

Athabasca River

Ath

abas

ca R

iver

Saleski

KP 184

KP 180

KP 170

KP 160

KP 150KP 140KP 130

KP 80KP 70

KP 120KP 110KP 100

KP 90

KP 50

KP 0

KP 60

KP 40

KP 30

KP 20

KP 10


Right of Way Width

Given that the terrain poses challenges with respect to wetlands and access, we recognize how important it is to optimize working space and safety on the right of way.

Laricina has determined that safe installation of the pipeline project will require an approximately 35 metre wide right of way (30 metre permanent and 5 metre temporary). Additional temporary workspace may be taken in areas of challenging slopes, wet terrain, road and water course crossings and other infrastructure such as existing pipelines.

Community Involvement

Laricina is committed to transparent consultation with all stakeholders and nearby communities in the areas in which we operate. Our public consultation program is designed to reflect Energy Resources Conservation Board (ERCB) Directive 56 to ensure that we:

• engage with Aboriginal communities in the area to learn and understand how our proposed pipeline project may impact their rights and traditional uses;

• build and maintain transparent, mutually beneficial and respectful relationships with Aboriginal communities and our stakeholders;

• listen effectively and seek to understand the Aboriginal communities’ and stakeholders’ perspectives, requests, and recommendations and give them every consideration in light of our business requirements;

• review our progress and learnings with potentially impacted Aboriginal communities;

• seek input into the design of the consultation process and practices to ensure we respect and meet the communications and consultation needs of participants in the area;

• provide timely, accurate information in a manner that is conducive to promoting understanding of the information we are sharing;

• provide Aboriginal communities and stakeholders with the opportunity to understand our plans and operations and provide feedback on how their input will be incorporated in our plans and operations; and

• establish and maintain open communication and a high level of inclusiveness by identifying and including those who may have an interest or potentially be impacted by our activities and proposed activities.

Laricina will seek input into the design of the consultation process and will inform Aboriginal communities and stakeholders of proposed Stony Mountain Pipeline developments. We will provide all communities with the opportunity to understand our plans and operations, as well as provide feedback.

Laricina’s “Commitments Communications Model” will be adopted to promote open dialogue and integrate stakeholder feedback into our consultation program.

LISTEN

EXECUTE

COMMITM

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REPORT B

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STATE OU

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Schedule

Laricina intends to file regulatory applications in mid-2012. Pending regulatory approval, construction would start in late 2013 with right of way clearing. Based on Laricina’s current plan, the blended crude bitumen pipeline will be completed by mid-2015, with the diluent pipeline completed a year later.

06

Aboriginal and public consultation process

Application preparation

Application filing

Regulatory review

Engineering

Blended crude bitumen pipeline – Construction

Start-up

Diluent pipeline – Construction

Start-up

Final clean up

2012 2013 2014 2015 2016 2017

We will listen to you and to what matters most to your community. Your voice will be heard through direct dialogue with our team. By understanding your priorities, we can work together to minimize the impact of the Stony Mountain Pipeline.

WE HOPE TO HEAR FROM YOUPLEASE CONTACT US

FOR MORE INFORMATIONLaricina welcomes input from local communities, Aboriginal communities, land users, and stakeholders and can be contacted for questions or comments.

Yvonne Walsh Manager, Community Engagement

Laricina Energy Ltd. T: 403.718.9370East Tower, 5th Ave Place F: 403.263.0767Suite 800, 425 – 1st St. SW [email protected], AB T2P 3L8 www.laricinaenergy.com

STONY MOUNTAIN PIPELINE PROJECT DESCRIPTION DOCUMENT · A bore hole is drilled under the water body...

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