"This agreement allows Canadian Natural to gain access to major sales pipelines out of Edmonton for our high-quality synthetic crude oil which will be produced at the Horizon Project, while at the same time provide significant quality benefits associated with being the only shipper on the Horizon Pipeline," said Real Cusson, senior vice-president marketing. The Horizon Project, fully owned and operated by Canadian Natural, is a phased development and includes the open-pit mining of bitumen combined with an on-site upgrader. Phase 1 production is planned to begin in the second half of 2008 at 110,000brl/d of 34o API light, sweet, synthetic crude oil. Phase 2 would increase production to 155,000brl/d in 2010, and Phase 3 would further increase production to 232,000brl/d in 2012. Pembina will complete the twinning of the existing Alberta oilsands pipeline, resulting in two parallel pipelines, one of which will be dedicated to Canadian Natural. That pipeline, combined with a new pipeline constructed from the Horizon Project site down to the AOSPL Terminal (the Horizon pipeline), will provide crude oil transportation service for the Horizon Project. The initial term of the agreement is 25 years, which will begin on the in-service date. In addition to having the option to renew the agreement, Canadian Natural has the right to request incremental expansions of the Horizon pipeline based upon applicable National Energy Board approved multi-pipeline economics. Construction of the Horizon pipeline is expected to begin in 2006, and the pipeline will be fully operational by mid-2008 to coincide with first production at the Horizon project.