Inter Pipeline Fund Announces Transportation Agreement for Canadian Natural Resources Kirby South Oil Sands Project

Inter Pipeline Fund Announces Transportation Agreement for Canadian Natural 
Resources Kirby South Oil Sands Project 
CALGARY, ALBERTA -- (Marketwired) -- 08/08/13 -- Inter Pipeline Fund
("Inter Pipeline") (TSX:IPL.UN) announced today that it has entered
into a long term agreement with Canadian Natural Resources ("CNR") to
transport diluent and bitumen blend for the Kirby South oil sands
project. Approximately $95 million in pipeline and associated
facilities have been constructed to connect the Kirby South
production site to the Cold Lake pipeline system.  
Under the terms of the agreement, CNR has contracted for
approximately 63,000 barrels per day (b/d) of bitumen blend and
18,000 b/d of diluent transportation capacity for the Kirby South
project beginning in August 2013. Inter Pipeline's investment is
supported by a long term contract which does not involve exposure to
throughput volumes or commodity price fluctuations. 
"We are very pleased to be the transportation service provider for
the Kirby South oil sands project," commented David Fesyk, President
and CEO of Inter Pipeline. "This is a highly accretive investment
which complements our current expansion activities in the Cold Lake
region. Our long term, integrated expansion plans are unfolding as we
anticipated." 
In late March, Inter Pipeline announced that it had executed
definitive transportation agreements for a major $2.6 billion
capacity expansion program on its Cold Lake and Polaris systems in
support of three oil sands projects owned by the FCCL Partnership
("FCCL"), a business venture between Cenovus and ConocoPhillips. 
Project Description 
Kirby South is a new large scale in-situ oil extraction project which
will utilize steam assisted gravity drainage technology to recover
subsurface bitumen. The Kirby South production site is located
approximately 10 kilometres ("km") south of Conklin, Alberta and is
in close proximity to new pipeline infrastructure being constructed
under Inter Pipeline's previously announced $2.6 billion integrated
oil sands development program. Inter Pipeline expects to capture
certain cost synergies through the coordination of construction
activities. In addition, production from the Kirby South project will
be shipped on certain common segments of pipeline where 
surplus
capacity will be available, making this a very capital-efficient
investment.  
Transportation of bitumen blend for the Kirby South project will be
provided through a new 20 km, 16-inch diameter pipeline lateral from
CNR's production site to Inter Pipeline's Winefred Junction. This
lateral connects to a new 30-inch pipeline constructed to transport
bitumen blend from three regional oil sands projects owned by FCCL.
Approximately 20 km of new 10-inch pipeline has also been constructed
from Winefred Junction to the Kirby South site to provide diluent
transportation service.  
Construction began in the fall of 2012 and all new facilities are
expected to be in service in August 2013. A map showing the
configuration of new facilities related to the Kirby South project is
available on our website at www.interpipelinefund.com.   
Commercial Terms and Economics 
The transportation agreement announced today will provide Inter
Pipeline with highly stable, long term cash flow. Under the terms of
the contract, CNR will make fixed annual transportation payments
which are not dependent on actual volumes shipped. All operating
costs will also be recovered on a flow through basis.  
Total capital expenditures are expected to be approximately $95
million based on Inter Pipeline's 85% interest in the Cold Lake
Limited Partnership. Inter Pipeline expects to earn incremental
EBITDA of $35 million per year once this highly accretive project
enters commercial service in August 2013. The investment is expected
to provide approximately $0.07 per unit in accretion relative to cash
available for distribution.  
Financing 
Inter Pipeline's financing plan for the $95 million Kirby South
connection has been developed in tandem with capital funding plans
for its $2.6 billion integrated expansion program on the Cold Lake
and Polaris systems. Inter Pipeline anticipates that combined capital
commitments will be met through a combination of capacity available
under its existing committed credit facility, undistributed cash flow
from operations, the periodic issuance of new term debt and proceeds
from existing distribution re-investment programs. In addition, Inter
Pipeline may supplement its capital requirements through the periodic
issuance of comparatively small amounts of underwritten equity.  
Inter Pipeline's financial position is supported by investment grade
credit ratings, a strong balance sheet and excellent access to
capital markets.  
Inter Pipeline Fund 
Inter Pipeline is a major petroleum transportation, natural gas
liquids extraction, and bulk liquid storage business based in
Calgary, Alberta, Canada. Structured as a publicly traded limited
partnership, Inter Pipeline owns and operates energy infrastructure
assets in western Canada, the United Kingdom, Denmark, Germany and
Ireland. Additional information about Inter Pipeline can be found at
www.interpipelinefund.com.  
Inter Pipeline is a member of the S&P/TSX Composite Index. Class A
Units trade on the Toronto Stock Exchange under the symbol IPL.UN.  
Eligible Investors 
Pursuant to Inter Pipeline's limited partnership agreement dated
October 9, 1997, as amended, all unitholders are required to be
residents of Canada. A copy of the limited partnership agreement can
be found at www.interpipelinefund.com by selecting "Corporate
Governance". If a unitholder is a non-resident of Canada
("Non-Eligible Unitholder"), he will not be considered to be a member
of the partnership effective as of the date Class A Units were
acquired. Inter Pipeline requires all Non-Eligible Unitholders to
dispose of their Class A Units in accordance with the limited
partnership agreement.  
In most cases, a unitholder with an address outside of Canada will be
a Non-Eligible Unitholder.   
Disclaimer 
Certain information contained herein may constitute forward-looking
statements that involve risks and uncertainties. Forward-looking
statements in this news release include, but are not limited to,
timing and completion cost estimates for the Kirby South project and
forward EBITDA projections. Readers are cautioned not to place undue
reliance on forward-looking statements. Such information, although
considered reasonable by the General Partner of Inter Pipeline at the
time of preparation, may later prove to be incorrect and actual
results may differ materially from those anticipated in the
statements made. For this purpose, any statements that are not
statements of historical fact may be deemed to be forward-looking
statements. Forward-looking statements often contain terms such as
"may", "will", "should", "anticipate", "expects" and similar
expressions. Such risks and uncertainties include, but are not
limited to, risks associated with operations, such as loss of
markets, regulatory matters, environmental risks, industry
competition, potential delays and cost overruns of construction
projects including the transportation arrangements with CNR, Cenovus
and ConocoPhillips' FCCL Partnership, and the ability to access
sufficient capital from internal and external sources. You can find a
discussion of those risks and uncertainties in Inter Pipeline's
securities filings at www.sedar.com. The forward-looking statements
contained in this news release are made as of t
he date of this
document, and, except to the extent required by applicable securities
laws and regulations, Inter Pipeline assumes no obligation to update
or revise forward-looking statements made herein or otherwise,
whether as a result of new information, future events, or otherwise.
The forward-looking statements contained in this document are
expressly qualified by this cautionary note.  
All dollar values are expressed in Canadian dollars unless otherwise
noted.  
Non-GAAP Financial Measures 
Certain financial measures referred to in this news release, namely,
"EBITDA" and "cash flow" are not measures recognized by GAAP. These
non-GAAP financial measures do not have standardized meanings
prescribed by GAAP and therefore may not be comparable to similar
measures presented by other entities. Investors are cautioned that
these non-GAAP financial measures should not be construed as
alternatives to other measures of financial performance calculated in
accordance with GAAP.  
Contacts:
Inter Pipeline Fund - Investor Relations:
Jeremy Roberge
Vice President, Capital Markets
403-290-6015 or 1-866-716-7473
jroberge@interpipelinefund.com 
Inter Pipeline Fund - Media Relations:
Tony Mate
Director, Corporate and Investor Communications
403-290-6166
tmate@interpipelinefund.com
www.interpipelinefund.com