A major pipeline under construction in southeast Saskatchewan will provide access to new natural gas supply being developed in the Bakken light oil formation, SaskEnergy said Thursday.

The $29-million, 117-km pipeline from Alameda to Whitewood being developed by TransGas, the transmission and storage subsidiary of SaskEnergy, will transport associated gas to customers in Saskatchewan.

Associated gas is natural gas extracted during the development of oil reserves. If pipeline capacity is unavailable or too far from existing natural gas infrastructure, oil producers must flare or burn off excess natural gas, resulting in greenhouse gas emissions.

"The Alameda-Whitewood pipeline taps into an important long-term natural gas supply that will be used to fuel Saskatchewan's growing economy," said Dustin Duncan, minister responsible for SaskEnergy.

Duncan said oil companies can significantly reduce their greenhouse gas (GHG) emissions by capturing, rather than flaring, associated gas.

Pending provincial government regulations will make it necessary for oil producers to capture more associated gas, he added.

"This pipeline's peak capacity will allow the energy industry in southeast Saskatchewan to reduce CO2 levels from natural gas flaring by the equivalent of annual emissions produced by heating 105,000 homes in Saskatchewan," Duncan said.

"That's every household in Saskatoon and Regina combined."

Crescent Point Energy Corp., one of the major producers of Bakken oil, expects the Bakken play to provide years of crude oil and natural gas production and reserves growth.

"We're pleased TransGas is able to provide the necessary infrastructure to facilitate this long-term growth," said Trent Stangl, vice-president of marketing and investor relations for Crescent Point.

Construction of the pipeline has been awarded to Carson Energy Services Ltd. of Lampman.

Source: The Leader Post

DiscoverWeyburn.com is Weyburn's only source for community news and information such as weather and classifieds.