Pembina Completes Horizon Pipeline On Schedule

CALGARY, July 3 /CNW/ - Pembina Pipeline Income Fund (TSX: PIF-UN.TO) is pleased to report the successful completion of the Horizon Pipeline by its wholly owned subsidiary Pembina Pipeline Corporation ("Pembina"). Work on the $400 million project, which began in November 2006, was substantially completed on July 1, 2008, on schedule.

Pembina acquired the Alberta Oilsands Pipe Line ("AOSPL"), now referred to as the Syncrude Pipeline, in late 2001 and since that time has spent over $600 million to expand its service offering in the Athabasca oil sands region. In 2004, Pembina completed a capacity expansion of the Syncrude Pipeline, which provides 389,000 barrels per day ("bpd") of dedicated synthetic crude oil transportation capacity to Syncrude Canada Ltd. The following year, Pembina completed construction of the 136,000 bpd Cheecham Lateral pipeline. The Horizon Pipeline, which will provide 250,000 bpd of dedicated transportation capacity to Canadian Natural Resources Limited's ("CNRL") Horizon Oil Sands Project, entailed completion of the twinning of the original AOSPL asset and construction of 73 kilometres of new pipeline connecting to CNRL's oil sands facility. Pembina now has 775,000 bpd of fully contracted synthetic crude oil transportation capacity in three distinct pipelines serving customers in this region.

Glen Fyfe, Pembina's Project Manager for these undertakings, commented: "The Horizon Pipeline is the largest pipeline project ever undertaken by Pembina and we are proud to have completed it on schedule. Since expansion of AOSPL began in 2002, Pembina has achieved a total of over 2.5 million man hours of work without a lost time safety incident. Pembina would like to thank, and to congratulate, all of the designers, suppliers, contractors and other stakeholder groups involved with the successful execution of these projects during a period of unprecedented construction challenges in the Fort McMurray to Edmonton corridor."

The Horizon Pipeline will be operated under the terms of a 25-year extendible transportation agreement providing Pembina a fixed return on invested capital and full recovery of operating costs. Pembina projects that the Horizon Pipeline will contribute incremental net operating income of $45 million per year over the 25-year contract term, commencing on August 1, 2008.

Pembina will continue to focus on the expansion of its service capability in the growing oil sands and heavy oil sector. Pembina's Mick Dilger, Vice President Business Development, stated: "The Horizon Project is representative of the ongoing optimization and build-out of our existing asset portfolio. This model enables Pembina to offer competitive service to customers while realizing attractive returns and minimizing our operating footprint and environmental impact. We expect to employ a similar strategy in the construction of our proposed Nipisi and Mitsue Pipelines. Further, Pembina's existing investments in oil sands and heavy oil infrastructure have embedded growth opportunities which we hope to realize as our customers undertake planned expansion of their oil sands production facilities in the future."

Pembina Pipeline Income Fund (TSX: PIF.UN, PIF.DB.B) is among the leading issuers in the Canadian energy infrastructure trust sector. Pembina's extensive network of conventional liquids feeder pipelines, and growing presence in the oil sands, heavy oil and midstream sectors, provide an integral service to the western Canadian energy industry. This balanced portfolio of premium, long-life energy infrastructure assets supports the stability and sustainability of the Fund. Information on the Pembina Pipeline Income Fund (the "Fund") is available on the Company's website at www.pembina.com.

Forward-Looking Information and Statements

This document contains certain forward-looking statements that are based on the Fund's current expectations, estimates, projections and assumptions in light of its experience and its perception of historical trends. In particular, this document contains forward-looking statements regarding net operating income, which is based upon the assumptions that the pipeline system will be in service on August 1, 2008, that future tolls are consistent with internal projections, that counterparties fulfill their contract obligations in a timely manner, that there are no unforeseen events preventing performance of contracts by Pembina, and that there are no unforeseen material costs relating to the pipeline system which are not recoverable from shippers. In some cases, forward-looking statements and information can be identified by terminology such as "may", "will", "should", "expects", "projects", "plans", "anticipates", "targets", "believes", "strives", "estimates", "continue", "designed", "objective", "maintain", "schedule", "endeavor" and similar expressions. The forward-looking statements are not guarantees of future performance and are subject to a number of known and unknown risks and uncertainties, including, but not limited to: the impact of competitive entities and pricing; reliance on key industry partners, alliances and agreements; the strength and operations of the oil and natural gas production industry and related commodity prices; the continuation or completion of third party projects; regulatory environment and inability to obtain required regulatory approvals; tax laws and treatment; fluctuations in operating results; the ability of Pembina to raise sufficient capital to complete future projects and satisfy future commitments; construction delays; labour and material shortages; and certain other risks detailed from time to time in the Fund's public disclosure documents. The Fund believes the expectations and material factors and assumptions reflected in these forward-looking statements are reasonable as of the date hereof, but no assurance can be given that these expectations, factors and assumptions will prove to be correct. Undue reliance should not be placed on these forward-looking statements as both known and unknown risks and uncertainties, including those business risks stated above, may cause actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. Accordingly, readers are cautioned that events or circumstances could cause results to differ materially from those predicted, forecasted or projected. Such forward-looking statements are expressly qualified by the above statements. The Fund does not undertake any obligation to publicly update or revise any forward-looking statements or information contained herein, except as required by applicable laws. Management of the Fund approved the financial outlook contained herein as of the date of this press release. The purpose of the financial outlook contained herein is to give the reader an indication of the value to Pembina of the Horizon Pipeline. Readers should be aware that the information contained in the financial outlook contained herein may not be appropriate for other purposes.

Contacts

Glenys Hermanutz
Vice President
Corporate Affairs
Pembina Pipeline Corporation
(403) 231-7500
1-888-428-3222
e-mail: investor-relations@pembina.com