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Major Pipeline Investment Comes to Saskatchewan

The Government of Saskatchewan announced the first completed, in-service pipeline project under the provincial Oil Infrastructure Investment Program (OIIP).

The Husky Midstream’s Saskatchewan Gathering System Expansion near Spruce Lake consists of 62 kilometres of new pipeline and 12 kilometres of replacement pipe.

It will accommodate a new shipping capacity of up to 48,000 barrels per day of crude oil production supporting growth and broader access to export markets. The project cost $82 million and created about 450 construction-related jobs at its peak.

“Our government will continue supporting the development of oil infrastructure in our province to create long-term sustainable growth for our energy industry,” Premier Scott Moe said. “This project is a step towards meeting our Growth Plan targets to increase oil production by 25 per cent to 600,000 barrels per day by 2030.”

The OIIP, first introduced by the Ministry of Energy and Resources in 2020, offers transferable oil and gas royalty/freehold production tax credits, at a rate of 20 per cent of eligible costs, for qualified projects that significantly increase provincial pipeline capacity.

Husky Midstream’s project, as well as other anticipated new and expanded pipeline infrastructure, will help alleviate record level demand for rail and truck transportation for oil and, at the same time, reduce emissions and transportation costs for the energy sector. Increased pipeline capacity will also potentially generate increased royalties and revenues for the province. Husky Midstream is operated by Cenovus Energy.

The Government of Saskatchewan will be accepting applications under the OIIP program until March 31, 2025.

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