The Aux Sable Story
Aux Sable’s vision is to be a market leader in the natural gas processing and NGL industry within selected regions of North America where Aux Sable can secure and expand competitive advantages to achieve predictable earnings growth.
Aux Sable was established as part of the development of the Alliance Pipeline system that was constructed over 1998-2000 with start-up on December 1, 2000. Two companies were established, one in the U.S. (Aux Sable Liquid Products or “ASLP” located in Channahon, Illinois) and one in Canada (Aux Sable Canada or “ASC” located in Calgary, Alberta) to manage the natural gas liquids (NGLs) business associated with the Alliance Pipeline. Aux Sable has the exclusive right to extract NGLs from Alliance Pipeline gas. Alliance Shippers are kept whole on an energy basis as Aux Sable is required to provide any make-up energy to balance for NGLs it has extracted from Alliance gas.
Alliance Pipeline
The Alliance Pipeline high pressure, dense phase system involves over 2,000 miles of 36 inch mainline pipe and over 280 miles of gathering pipe connected to 47 gas plants in northwestern Alberta and northeastern B.C. These plants have a design capacity in excess of 2600 million cubic feet per day (mmcfd). Alliance currently has a capacity of approximately 1590 mmcfd on an annualized basis through its mainline of which 1325 mmcfd is the base throughput capacity guaranteed by Alliance under ship or pay contracts with an initial term of 15 years (2001 to 2015). Alliance is owned by Enbridge and Fort Chicago.
Aux Sable USA
Aux Sable Liquid Products owns and operates one of the largest NGL extraction and fractionation plants in North America. The facility is located in Channahon, Illinois about 50 miles southwest of Chicago near the eastern terminus of the Alliance pipeline. Operations commenced December 1, 2000 coincidental with start-up of the Alliance pipeline. It is capable of processing 2100 mmcfd of gas and can produce about 87,000 barrels per day of specification NGL products. Currently, all of the Alliance gas is processed at ASLP’s Channahon NGL Facility.
On December 31, 2005 ASLP entered into a 20 year NGL supply agreement with BP whereby 100% of the output of ASLP’s Channahon NGL Facility is sold to BP. Aux Sable recovers associated operating costs, a fixed profit fee and an upside fee depending on the level of business profitability. This relationship provides a stable foundation for growth. The agreement does not preclude ASLP from pursuing other interests in the NGL business.
Aux Sable Canada
Aux Sable Canada was initially established to secure high NGL content gas and injected NGLs (primarily propane and butanes) to profitably utilize the Channahon NGL Facility's capacity. It utilized fractionation and storage facilities in Alberta and focused on several gas processing/transportation projects. ASC will continue to be active in the western Canada NGL business by developing options to deliver NGL rich gas and/or NGL injections into the Alliance Pipeline system.
In addition, ASC has been active in developing energy infrastructure related projects. It is pursuing a strategy of building, owning and operating off-gas processing facilities for current and new heavy oil upgrading facilities in the Fort Saskatchewan, Alberta area. ASC is currently progressing Phase 1 of the Heartland off-gas processing project with start-up coinciding with the start-up of
BA Energy Phase 1 Heartland Upgrader project in the latter half of 2008. ASC is also working to develop an ethane extraction facility in Fort Saskatchewan to provide ethane feedstock to the petrochemical industry in Alberta.
History
Aux Sable originally derived its corporate name from the township where it located the NGL extraction and fractionation facility in 1996 as part of the Alliance project. Aux Sable Township itself was named by the original French Canadian settlers who traveled to and from the sand bar on the local creek to access water… "aux sable" means "to the sand" in French.
Aux Sable has now been in operation for over six years and has delivered outstanding operating, safety and environmental results. The company continually strives to meet high standards in these areas, to comply with appropriate financial/business controls and to be a responsible participant in the local communities where it has operations. Financial results have improved dramatically over the past few years. In addition, the BP agreement provides a stable foundation to progress future growth. ASLP and ASC are both private companies owned by Enbridge, Fort Chicago and Williams. The company is now well positioned to pursue its vision through development of opportunities to optimize the advantages inherent in the Alliance dense phase energy delivery system as well as growth opportunities outside of its exclusive NGL position in the Alliance gas/NGL transport system.
