Inter Pipeline Announces Q2 2020 Financial & Operating Results
08.09.2020 - NEWS

August 10, 2020 [Boe Report] – European bulk liquid storage capacity utilization averaged 98 percent for the quarter. Construction activities at the Heartland Petrochemical Complex (HPC) site continued to track according to the revised schedule and cost estimate.

 

Heartland Petrochemical Complex

In the second quarter of 2020, Inter Pipeline continued to advance construction at the $4 billion Heartland Petrochemical Complex. Construction at HPC remains very active with approximately 2,600 workers currently on site each day, protected by rigorous sanitation and social distancing controls. Second quarter 2020 investment into the project was $238 million, bringing the total project spend since inception to approximately $2.7 billion.

Several construction milestones were met at the propane dehydrogenation facility over this period including the installation of the electrical systems, the interior components of the splitter tower and the condensers. Activities at the polypropylene plant include the completion of the reactor structure and the installation of the cycle gas compressor and the flare stack. Significant progress was also made on advancing the rail loading yard, a critical supply chain component for the transportation of polypropylene to market.

The process to secure a partner to purchase a material interest in the Heartland Petrochemical Complex remains active. While there can be no certainty that a definitive agreement will be reached, a partner would benefit from joining a well-developed, world-scale petrochemical project that has substantial commercial advantages.
 

Conventional Oil Pipelines

Inter Pipeline’s conventional oil pipelines business segment generated funds from operations of $26.3 million as throughput volume and marketing activities on this system declined in response to the collapse in global energy prices.

As expected, average throughput volume decreased to approximately 140,000 b/d, down approximately 45,000 b/d from the second quarter of 2019, due to producer production curtailments. At this time, early results for the third quarter of 2020 indicate that volume is beginning to recover. July’s average volume was approximately 157,000 b/d.

In April, the 75-kilometer Viking Connector pipeline, which provides new access to the Edmonton market hub and additional flexibility for producers, was placed into service on time and on budget. In addition, the construction of two,130,000-barrel storage tanks at the Stettler Terminal, was completed at the end of June. These activities conclude the first two-phases of Inter Pipeline’s planned multi-phased expansion of the Central Alberta pipeline system. Additional phases are expected to be developed when market conditions improve.
 

Bulk Liquid Storage

Inter Pipeline’s bulk liquid storage business generated strong financial results in the second quarter of 2020. Funds from operations increased to $34.2 million in the second quarter of 2020, from $26.9 million a year ago, with the Danish terminals continuing to experience strong refined petroleum storage demand.

Storage utilization rates increased to 98 percent in the second quarter of 2020, compared to 83 percent during the same period in 2019. Demand for storage infrastructure is expected to remain strong in Europe throughout 2020.

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