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Decision 2010-006

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Decision 2010-006 Decision 2010-006 Nexen Inc. OPTI Canada Inc. Long Lake South Phase 1 Cogeneration Power Plant Power Plant and Facility Application January 15, 2010 ALBERTA UTILITIES COMMISSION Decision 2010-006: Nexen Inc. and OPTI Canada Inc. Long Lake South Phase 1 Application No. 1604706 Proceeding ID. 252 January 15, 2010 Published by Alberta Utilities Commission Fifth Avenue Place, 4th Floor, 425 - 1 Street SW Calgary, Alberta T2P 3L8 Telephone: (403) 592-8845 Fax: (403) 592-4406 Web site: www.auc.ab.ca ALBERTA UTILITIES COMMISSION Calgary Alberta NEXEN INC. OPTI CANADA INC. Decision 2010-006 LONG LAKE SOUTH PART 1 Application Nos. 1604706 COGENERATION POWER PLANT AND SUBSTATION Proceeding ID. 252 1 INTRODUCTION 2. On January 30, 2009, the Alberta Utilities Commission (AUC or the Commission) received Application No. 1604706 (the Application) from Nexen Inc. and OPTI Canada Inc. (Nexen/OPTI) for approval of a new cogeneration power plant pursuant to section 11 of the Hydro and Electric Energy Act, and substation to be designated as 872S substation pursuant to sections 14, and 15 of the Hydro and Electric Energy Act in the vicinity of the hamlet of Anzac, approximately 40 kilometres (km) southeast of the City of Fort McMurray (Long Lake South Phase I). 3. Nexen/OPTI proposes to construct and operate a cogeneration power plant, consisting of one 85-MW General Electric 7EA DLN gas turbine generator and one heat recovery steam generator (the Power Plant). In addition, Nexen/OPTI proposes to construct a cogeneration substation designated 872S, consisting of one 85/113 MVA 144/13.8-kV transformer (the Substation). 2 BACKGROUND 4. In 2003, Nexen/OPTI received approval from the Alberta Energy and Utilities Board (AEUB), the Alberta Energy Resources Conservation Board’s (ERCB) predecessor, for approval to construct and operate the Long Lake Project (Long Lake), consisting of a steam assisted gravity drainage (SAGD) operation. In December 2006, Nexen/OPTI applied to the AEUB for approval to construct and operate the Long Lake South Project (Long Lake South), consisting of an additional SAGD operation for the production of bitumen. On February 25, 2009, the ERCB approved the construction and operations of Long Lake South pursuant to the Oil Sands Conservation Act. 5. On January 6, 2009 Nexen/OPTI applied to the Commission to amend the Industrial System Designation Order U2006-241 to include its electrical facilities at Long Lake South. On February 18, 2009 the amendment was granted by the Commission by way of Industrial System Designation Order No. U2009-64. 6. On January 30, 2009, Nexen/OPTI filed with the Commission the Application for Long Lake South Phase I. 7. Nexen/OPTI conducted public and landholder consultation with all landholders, residences, agencies and interested parties within 2,000 metres of the proposed project area. No outstanding concerns were expressed by stakeholders. AUC Decision 2010-006 (January 15, 2010) • 1 Long Lake South Part 1 Cogeneration Power Plant and Substation Power Plant and Facility Application Nexen Inc. and OPTI Canada Inc. 8. The Commission issued a single Notice of Application on November 4, 2009 to directly affected landowners. No letters of objection or concern were received by the Commission. 9. Nexen/OPTI stated that environmental impacts related to the proposed Long Lake South Phase 1 project were assessed as part of the larger Long Lake South project, and was provided in an Environmental Impact Assessment (EIA) that was submitted to and reviewed by Alberta Environment. Nexen/OPTI also stated that the Long Lake South project is in a region that has been extensively explored and developed for natural gas, and a number of other SAGD projects are operating in the vicinity of the Long Lake South project. 10. A Noise Impact Assessment (NIA) was provided which demonstrated that at a distance of 1,500 metres from the Power Plant and the Substation noise sources, the predicted noise level will be below the Permissible Sound Level (PSL) of 40 dBA Leq nighttime, as per AUC Rule 012 –Noise Control. 3 COMMISSION FINDINGS 11. The Application was filed for a new cogeneration power plant pursuant to section 11 of the Hydro and Electric Energy Act, and substation pursuant to sections 14, and 15 of the Hydro and Electric Energy Act. 12. The Commission notes that the EIA provided in the Application is extensive and meets the requirements of AUC Rule 007. The Commission also notes that the environmental aspects of the proposed Power Plant and Substation are relatively minor compared to the SAGD operations of the Long Lake South project. 13. The Commission notes that the NIA provided in the Application indicates that the anticipated noise levels would be within the PSL limits as specified in AUC Rule 012. 14. The Commission notes that Nexen/OPTI consulted with all landholders, residences, agencies and interested parties within 2,000 metres as outlined in AUC Rule 007. As well, Notice of Application was issued by the Commission to all stakeholders within 2,000 metres of the proposed project area and notes that no objection to the Application was received by the Commission. 15. The Commission finds that there are no outstanding technical, environmental or noise concerns associated with the Application, nor are there any outstanding public or industry objections or concerns. 2 • AUC Decision 2010-006 (January 15, 2010) Long Lake South Part 1 Cogeneration Power Plant and Substation Power Plant and Facility Application Nexen Inc. and OPTI Canada Inc. 4 DECISION 16. The Commission approves the Application, pursuant to sections 11, 14 and 15 of the Hydro and Electric Energy Act. Respective approvals set out in Appendix 1 and Appendix 2 are granted (the Appendices will be distributed separately). Dated in Calgary, Alberta on January 15, 2010. ALBERTA UTILITIES COMMISSION (original signed by) N. Allen Maydonic, Q.C. Commissioner AUC Decision 2010-006 (January 15, 2010) • 3 .
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