Peace Pipe Line Ltd.

Category:Introduction Category:Overview Category:History Category:Advances Category:Accidents and spills

Oil was discovered in 1954 about 220 miles (355 km) north west of Edmonton, Alberta in the oilfields known as a Sturgeon Lake, Sturgeon Lake South and Little Smoky. With a demand for market access, six of the producing companies in the area joined forces and incorporated Peace River Oil Pipe Line Co. Ltd. on November 17, 1954. The six equal owners were; AMERADA Petroleum Corp., Canadian Gulf Oil Co., Hudson’s Bay Oil & Gas Co. Ltd, Imperial Oil Ltd., Shell Oil Co., and Union Oil Company of California.

The British American Oil Co. Ltd (B/A) merged with Canadian Gulf Oil Co. at the emergence of the pipeline and as such, The Peace River Oil Pipe Line Co. Ltd was operated by Britamoil, a division of British American Oil Co. Ltd. from 1955 to 1963 when a separate management group was established. In 1955, $7 Million was spent to construct the first mainline portion of the pipeline to transport crude oil from the Sturgeon Lake fields to the Trans Mountain Pipe line pump station at Edson. The first leg was a 16” pipeline from the Valleyview pump station which was situated 12km south of Valleyview, Ab and ran to Fox Creek, Alberta. The line continued from Fox Creek to Edson as a 12” line.

1956 was Peace River Oil’s first year of operation with a total of 145 miles (233 km) and delivering a daily average of 9093 bbls. Nearly 100% of the transported product was owned by the major six shareholders. During this same time, several refineries in Edmonton were being constructed to accommodate the expansive market demand of the growing exploration and discoveries in the province. In 1961, a major extension to the system was undertaken with the construction of a pipeline from the Fox Creek pump station to Edmonton, Ab with connections to TransMountain Pipe Line, Interprovincial Pipe Line and to the new local refineries. By this time, approximately 65% of the stream was owner production with capacity being supplied by other new companies. In 1961, additional ownership shares were issued to fund the construction, bringing the total number of shares to 272388.

1963 was a busy year stating with a separate management group, as the Peace Pipe Line had taken over its management from Britamoil and established a head office in Calgary with 13 employees in addition to 20 field employees for a total of 33 staff. During the same time, a gathering line was completed from Valleyview to Snipe Lake and construction began on a new 120 mile (193 km), 8” trunk line from Snipe Lake to Red Earth, Alberta, and a further 8” line from Red Earth to Nipisi which was all completed in 1964. Other projects during 1961 included gathering lines to Goose River, Sturgeon Lake South and to Kaybob South. By the end of 1961, Peace River Oil was operating 581 miles (935 km) of pipeline.

From 1962 to 1965 there was an increase of 10,300 bbls/d to the pipeline system. In early 1965, The company began construction of the Edmonton Control Centre and a microwave radio communication system to enhance its operational efficiency. By then of this year, the company’s throughput was an average 55,562 bbls/d with over 691 miles (1112 km) of pipe. By the end of this year, approximately 55% of the stream came from the owners’ production. Construction began on a 20” line from Valleyview to Zama, north west of High Level, Alberta whish was complete in mid march 1968.

In 1968, part of the Fox Creek to Edmonton upgrade to 20” line was completed as part of a looping system. Peace River Oil now had a throughput of over 71,000 bbls/d with five separate streams of oil being transported and a total of 1151 miles (1852 km) of pipe with 61 employees. With so much growth, additional shares were issued, increasing the total to 389,055.

Beginning in 1969, Peace River Oil’s volumes of crude oil and natural gas liquids coming into Fox Creek had insufficient capacity to Edmonton with only one line. 78 miles (125 km) of 20” line was built to complete the looping of line between Fox Creek and Edmonton. The 20” portion of line was used for crude oil service and the adjacent 12” line was used for condensate and LPGs.

The Zama field North West of High Level, Alberta never did have realized oil production as projected, however, had substantial dry gas production. As such, Peace River Oil’s 20” pipeline from Zama to Valleyview (Northwest System) had difficulty delivering profitability and in 1971, the Peace River Oil Pipe Line sold the Northwest system to Alberta Gas Trunk Line for approximately $25 Million. This sale affected Peace River Oil’s throughput and reduced crude oil volumes by 12,300 bbls/d and reduced the staff to 58 employees. Peace River Oil Pipe Line negotiated long term throughput agreements with three major gas plants in the Kaybob South area this year. In 1973, the company changed it’s name as operations were no longer conducted in the Peace River area and for brevity sake and to relate to the ceremonial indigenous peace pipe symbol. The name was changed to Peace Pipe Line Ltd. effective November 22, 1973.

Effective the first day of January, 1979, Peace Pipe Line converted to the metric system to align with the rest of the industry. Continued expansion was occurring within the system and Peace had up to 85 employees by the end of the year with a daily average throughput of 145,466 bbls/d (23,116 Cubic Meters (M3)) over 1598 km (993 miles) of pipe.

In August 1980 Peace received approval to construct the Deep Basin line, a 180 km 12” line from the Simonette field to LaGlace (~40Km North West of Grande Prairie, Alberta). The expansion came in at a cost of $32 million and grew the workforce of Peace Pipe to a total 90 employees delivering 18 different streams of oil over a total 1912 km of pipe. The construction of the Deep Basin was completed in 1981 and Peace Pipe grew its workforce by a third to 120 employees but daily throughput was reduced by imposed provincial cutbacks from March 1 to September 1.

Question? When was the Laglace 12 built?

Significant volume increases on the Deep Basin line moved the company to build a 59 km extension from Simonette to Fox Creek. The volume increases came in the next few years with a major crude oil gathering system north of LaGlace to connect to the Valhalla field in 1985. The following year, this system was further extended north east of LaGlace to connect to crude oil production in the Spirit River, Alberta area. During this period, Peace Pipe constructed major new facilities to handle the growing production of Ethane under long term throughput agreements from three plants in the LaGlace, Elmworth and Wapiti areas. In October 1985, a permanent field office for the Deep Basin was located in Grande Prairie, Alberta to manage the experienced and projected growth. By the end of 1986, staff levels spiked to 241 employees working at Peace Pipe.

In 1988, construction began on an 8” pipeline from LaGlace north west to connect to Gordondale, where a new truck unloading terminal was built. In February 1989, two wholly-owned subsidiary companies were created. The Pouce Coupe Pipe Line Ltd. was a 25 KM 8” section from Gordondale to Dawson Creek, BC, crossing the Alberta and British Columbia Border. The Plateau Pipe Line Ltd. would continue west another 40 km to serve the Brassey Field.