Kinder Morgan Energy Partners LP announced that it will invest approximately $210 million to construct seven tanks with a storage capacity of 2.4 million barrels for crude oil and condensate at its Edmonton terminal in Strathcona County, Alberta, Canada.

Kinder Morgan Canada Terminals has entered into long-term contracts with customers to support the project. Kinder Morgan subsidiary Trans Mountain Pipeline previously received National Energy Board approval to construct merchant and regulated tanks at the Edmonton facility and intends to commence construction early in 2012 following receipt of other supporting permits. The new tanks are expected to be placed in service in late 2013.

“The new tankage will provide Alberta producers, marketers, and refiners additional crude oil and condensate storage options as oilsands production increases and crude oil prices remain volatile,” said Bill Henderson, vice-president of Kinder Morgan Canada Terminals. “Just as importantly, the project will set the framework for two additional phases that would ultimately allow for up to 6 million barrels of dedicated storage.”

Henderson said the Edmonton location allows for unparalleled upstream feeder pipeline connectivity and access to all downstream market outlets, including direct connections into the Trans Mountain Pipeline. Kinder Morgan Canada Terminals has begun seeking commercial support for the second phase of tank expansion.

“The new tanks add a very important component to Trans Mountain Pipeline’s expansion plans and will provide our existing and potential customers with significant crude staging flexibility,” said Ian Anderson, president of Kinder Morgan Canada.