Wolf Midstream proceeds with $1B NGL North Phase Two work

Key Takeaways:

• The company said this second phase this will significantly increase their ability to process natural gas and extract valuable natural gas liquids (NGLs).
• The NGL North Phase Two expansion is expected to cost $1 billion and be in-service in 2027.
• The increased NGL production is secured by long-term agreements with Alberta’s petrochemical companies, providing them with a reliable source of key materials.

The Whole Story:

Calgary-based energy company Wolf Midstream has announced a positive final investment decision to proceed with its NGL North Phase Two project, which will significantly increase the natural gas liquids (NGL) production capacity of Wolf’s existing NGL North System (NGL North), which was successfully commissioned in 2023.

Once completed, the expanded system will have the ability to recover NGL from approximately 1.5 billion cubic feet per day (Bcf/d) of natural gas and produce over 90,000 barrels per day (bpd) of NGL, including over 60,000 bpd of ethane. The vast majority of this production is committed under long-term agreements with Alberta’s growing petrochemical industry. NGL North Phase Two is an incremental investment in Alberta of approximately $1 billion, supported by Wolf’s shareholder, Canada Pension Plan Investment Board (CPP Investments).

“NGL North Phase Two includes Wolf Recovery Facility 2 which will recover higher carbon natural gas liquids prior to combustion at downstream oil sands production facilities,” said Kevin Jagger, president, Wolf NGL. “Additionally, the project includes a 125-kilometre pipeline lateral, a material expansion of the Wolf Feedstock Separation facility in Sturgeon County, a new unit train rail terminal and large-scale salt cavern storage.”

The entire NGL North project is a Wolf proprietary NGL recovery, transportation, and separation system capable of producing approximately 70,000 barrels per day of NGL including ethane, propane, butane and condensate.

It has three main components:

Recovery: an NGL recovery facility with an ultimate capacity of approximately one billion cubic feet per day, located in Northeast Alberta that recovers higher carbon NGL prior to downstream combustion;

Transportation: an NGL transportation system that includes approximately 100 kilometres of new-build pipeline to connect to Wolf’s existing 16-inch pipeline to transport recovered NGL from Wolf Recovery Facility I to the Wolf Feedstock Separation complex; and

Separation: an NGL separation complex located in Sturgeon County, Alberta and immediately proximate to Wolf’s existing Sturgeon Terminal and Alberta Carbon Trunk Line origin point. Wolf Feedstock Separation will have an ultimate capacity to produce approximately 70,000 barrels per day of NGL including ethane, propane, butane, and condensate.

“This is a very exciting opportunity,” said Bob Lock, president and chief executive officer of Wolf, “along with pre-investment for future phases, this expansion continues to build out NGL North’s ultimate potential of processing nearly 3 Bcf/d and recovering 170,000 bpd of NGL, creating a critical source of incremental, reliable feedstock supply for a new wave of downstream market development in Western Canada.”

The NGL North Phase Two expansion is expected to be in-service in 2027.