News Release

Pembina Pipeline Corporation Brings Nipisi and Mitsue Pipelines On-stream

New pipelines provide service to Alberta heavy oil customers

CALGARY, Aug. 3, 2011 /CNW/ - Pembina Pipeline Corporation ("Pembina") (TSX: PPL, PPL.DB.C) announced that it has completed the construction and has initiated start-up of its Nipisi heavy oil pipeline ("Nipisi Pipeline") and Mitsue diluent pipeline ("Mitsue Pipeline") (collectively the "Nipisi and Mitsue Pipelines") which will service the Pelican Lake and Peace River heavy oil regions of Alberta.

"This is an important accomplishment for Pembina and a major milestone in our growth strategy," said Bob Michaleski, Pembina's President and Chief Executive Officer. "By successfully bringing these pipelines on-stream, we are delivering on our commitment to building safe, reliable energy transportation infrastructure that meets the existing and future demands of the energy sector, and enhances cash flow and shareholder value."

The Nipisi Pipeline is a new, 190 kilometre ("km"), heavy oil pipeline with a design capacity of 100,000 barrels per day ("bpd") that will transport diluted heavy oil from north of Slave Lake to Pembina's existing pipeline south of Swan Hills and on to Edmonton, Alberta for further transport or processing.

The Mitsue Pipeline will transport condensate from various sources in north western Alberta to heavy oil producers operating north of Slave Lake, Alberta for use by producers to dilute heavy oil prior to transport. The pipeline consists of a combination of 135 km of new and 120 km of existing infrastructure, and has a design capacity of 22,000 bpd.

The Nipisi and Mitsue Pipelines are underpinned by long-term agreements which contain a minimum primary term of 10 years from the in-service date and are extendible thereafter. Pembina expects these pipelines to contribute stable, long-term cash flow, with full recovery of operating expenses.

Pembina estimates that the total capital cost of the Nipisi and Mitsue Pipelines will be approximately $400 million, down from Pembina's previous estimate of $440 million. The Nipisi and Mitsue Pipelines are expected to contribute annual operating margin of approximately $40 million once commissioning has been completed.

Pembina has designed the Nipisi and Mitsue Pipelines so the capacity of each pipeline can be increased in a staged approach. The Nipisi Pipeline has the potential to be expanded to 200,000 bpd and the Mitsue Pipeline could be expanded to 45,000 bpd. Expansion plans would require regulatory approval, which Pembina expects to pursue once customer support has been solidified.

The Mitsue Pipeline commenced operations in mid-June, ahead of schedule, and the Nipisi Pipeline initiated deliveries in early July. Commissioning and ramp-up on the Nipisi Pipeline is continuing and is expected to be completed early in the fourth quarter of 2011.

"We are very proud of the team that worked on this project, from conception to completion," said Mick Dilger, Pembina's Chief Operating Officer. "Not only did we manage to complete a project of this scale on time and under budget, but the team did it by working very closely, and developing strong relationships, with the neighbouring First Nations and other communities along our pipeline right-of-way. We are excited to now turn our attention to pursuing the various accretive expansion and integration opportunities this key infrastructure presents."

Pembina transports crude oil and natural gas liquids produced in Western Canada, owns and operates oil sands pipelines and has a growing presence in midstream and gas services. Pembina's common shares (PPL) and convertible debentures (PPL.DB.C) are traded on the TSX.

Forward-Looking Information and Statements

This news release contains certain forward-looking information and statements that are based on Pembina's current expectations, estimates, projections and assumptions in light of its experience and its perception of historical trends. In this news release, such forward-looking information and statements can be identified by terminology such as "forecasts", "expects", "plans", "estimates", "will", "may" and similar expressions.

In particular, this news release contains forward-looking statements, including certain financial outlook, pertaining to: (i) the designated capacities and future expansion capabilities of the Nipisi and Mitsue Pipelines; (ii) the estimated future operating margin contributions from the Nipisi and Mitsue Pipelines; and (iii) the expected timing of the completion of the commissioning and ramp-up of the Nipisi Pipeline. Various factors or assumptions are typically applied by Pembina in drawing conclusions or making the forecasts, projections, predictions or estimations set out in forward looking statements and financial outlook based on information currently available to Pembina. Factors and assumptions used by Pembina include that: future tolls and operating costs in respect of such pipelines will be consistent with internal projections; counterparties will comply with contracts in a timely manner; there are no unforeseen events preventing the performance of contracts by Pembina; prevailing commodity prices and exchange rates; funds will be available at acceptable rates to fund capital requirements relating to any future expansions of the pipeline projects; and there are no unforeseen material costs relating to the pipeline systems which are not recoverable from shippers.

These 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: non-performance of agreements in accordance with their terms; 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 Pembina's public disclosure documents including, among other things, those detailed under the heading "Risk Factors" in Pembina's management's discussion and analysis for the year ended December 31, 2010, which can be found at

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. Pembina 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 Pembina approved the financial outlook contained herein as of the date of this news release. Readers should be aware the information contained in the financial outlook contained herein may not be appropriate for other purposes.

All dollar values are in Canadian dollars.