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INTERPROVINCIAL CAPACITY EXPANSION

 SUPERIOR, Wisc., June 24 /PRNewswire/ -- Lakehead Pipe Line Partners L.P., and Interprovincial Pipe Line System Inc. of Edmonton, Alberta, today announced that Interprovincial will seek National Energy Board approval in Canada for a Cdn. $275 million expansion program to add 110,000 barrels per day of additional capacity to its crude oil and liquids pipeline system. The general partner of the partnership, Lakehead Pipe Line Company Inc., is wholly owned by Interprovincial.
 Brian F. MacNeill, president and chief executive officer of Lakehead Pipe Line Co. Inc., and of Interprovincial, said it was desirable to apply to the NEB at an early date in order to commence the regulatory approval process and thereby provide adequate construction time so that the facilities will be available for service by the end of 1994. It is anticipated Interprovincial's application, to be made through its wholly owned subsidiary Interprovincial Pipe Line Inc., will be filed on June 30.
 MacNeill said the expansion program is being undertaken in response to the needs of western Canadian oil producers. During the course of the past 2 1/2 years, shippers have consistently requested Interprovincial to transport volumes of oil in excess of the pipeline's capacity, forcing the company to apportion available space. The addition of 110,000 barrels per day provided for in the expansion proposal will more closely match the system's capacity with shipper requirements and eliminate the cost to industry of crude oil shut in because of insufficient capacity.
 The program should also help western Canadian producers receive full value for their oil in the U.S. midwest market. At the present time, purchasers of Canadian oil in the midwest discount the price, partly because of the uncertainty of deliveries caused by insufficient pipeline capacity.
 Of the Cdn. $275 million in expenditures, approximately Cdn. $260 million will be spent in Canada and the balance of Cdn. $15 million in the United States by Lakehead. It is estimated that approximately 640 man years of work will be generated. Included is the construction of approximately 437 miles of new 16-inch diameter pipeline from Edmonton, Alberta, to Regina, Saskatchewan, which would carry refined products and compatible streams, as well as alterations to existing pipelines between Edmonton and Superior. The transfer of refined products in western Canada to the new line frees up crude oil capacity on other Interprovincial lines. Interprovincial's proposal also complements the pipeline expansion program being developed by Wascana Pipe Line Ltd. of Calgary, Alberta, to provide western Canadian crude to refineries in Colorado, Montana, Utah and Wyoming. The Wascana pipeline connects with the Interprovincial system at Regina.
 MacNeill also announced today that Interprovincial has entered into an agreement with Williams Pipe Line Co., part of The Williams Companies Inc., of Tulsa, Okla., which operates 27,000 miles of petroleum and natural gas pipelines in the United States, to pursue jointly the construction of a new 100,000 barrel per day pipeline in the United States. If implemented, the new pipeline would connect an existing Lakehead pipeline at Lockport, Ill., with Patoka, Ill., a pipeline distribution hub located about 200 miles south of Chicago.
 The line would provide western Canadian producers with access to additional markets for their oil. The availability of additional markets for Canadian oil may also help reduce the discount on Canadian oil sold in the midwest.
 "The proposed capacity expansion, coupled with the new pipeline in the United States, provides western Canadian producers with an attractive package that will eliminate apportionment, expand the market for Canadian crude and help reduce the discount in the price of Canadian oil in the midwest market," MacNeill said.
 -0- 6/24/93
 /CONTACT: Jon Staudohar of Lakehead Pipe Line Partners L.P., 715-394-1404/
 (LHP)


CO: Lakehead Pipe Line Partners L.P. ST: Wisconsin IN: OIL SU:

MF-JL -- LA035 -- 5543 06/24/93 18:37 EDT
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Publication:PR Newswire
Date:Jun 24, 1993
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