New Diluent Line to Oil Sands in Service

Inter Pipeline Ltd , which operates regional pipeline systems in Western Canada, said on Friday it had completed a C$1.1 billion ($1.03 billion) conduit serving two northern Alberta oil sands projects operated by Cenovus Energy Inc.

Inter Pipe said the new line will deliver as much as 350,000 barrels per day of diluent, an ultra light form of crude oil blended into the tar-like bitumen from the oil sands so it can flow on pipelines, to the Foster Creek and Christina Lake projects co-owned by Cenovus and ConocoPhillips (COP).

The new line, which runs 290 kilometers (180 miles) from near Edmonton, Alberta, to Christina Lake and Foster Creek, is the largest part of Inter Pipeline's C$1.4 billion Polaris project, which will also include a link to the planned Narrows Lake oil sands development planned by Cenovus and its partner and to other operations in northwestern Alberta.

When complete, the Polaris system will have the capacity to deliver as much as 700,000 bpd of diluent.

Inter Pipeline shares were up 0.5 percent at C$33.35 in early afternoon on the Toronto Stock Exchange.

($1 = 1.0731 Canadian dollars)

(Reporting by Scott Haggett; editing by Matthew Lewis)