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Keyera expands Alberta gas processing presence

Christopher E. Smith
OGJ Pipeline Editor

HOUSTON, June 11 -- Keyera Facilities Income Fund announced June 10 it is expanding its gas processing capability in west central Alberta. Keyera will invest about $65 million to acquire ownership interests in two additional gas plants and increase its ownership interests in four of its existing gas plants.

Upon completion of these transactions, Keyera will have ownership interests in 17 gas plants and will increase its net gas processing capacity by 9%, or 151 MMcfd. All of the incremental capacity can extract NGLs and handle sour gas. Portions of the acquisitions are subject to rights of first refusal. All of the acquisitions are expected to close by July 15, subject to normal closing conditions.

Keyera will acquire a 57% ownership interest in the Minnehik Buck Lake gas plant and a 20% ownership interest in the Edson gas plant. In addition, it is acquiring various ownership interests in the Keyera-operated West Pembina, Nordegg River, Gilby, and Brazeau River gas plants. Interest in about 260 km of gathering pipelines and nine compressor stations is also part of the transactions, as is roughly 12 bcf of proved plus probable gas reserves and about 711,000 bbl of natural gas liquids reserves. Current production is about 4 MMcfd of gas and 350 b/d of NGLs.

The 100 MMcfd Minnehik Buck Lake plant lies between Keyera’s Rimbey and Bigoray gas plants, in an area with significant geological prospectivity. As the largest owner in the Minnehik Buck Lake plant (57%), Keyera plans to submit a proposal to the plant’s operating committee to become operator of the plant. The Edson gas plant extends Keyera’s reach northwest in the foothills region, into an area the company says has relatively under developed lands and attractive geology.

Asset details
The Minnehik Buck Lake gas plant can process sweet and sour gas, and extract NGLs. Current throughput is about 50 MMcfd. Keyera also acquired a roughly 60% interest in the plant’s inlet compressor, nine compressor stations, and about 260 km of sweet and sour gathering pipelines, a 57% ownership interest in the Minnehik Buck Lake Gas Unit No. 1, and a 100% ownership interest in certain nonunit wells, which deliver production to the plant for processing.

Talisman Energy Inc. operates the Edson gas plant. It has a license capacity of 375 MMcfd and can process both sweet and sour gas and extract NGLs. Current throughput is about 215 MMcfd.

Keyera also acquired an additional 7% ownership interest in its West Pembina gas plant, bringing ownership to 76%, a roughly 20% ownership interest in a field compressor and an additional 8% ownership interest in the Keyera West Pembina sulfur blocking facility, a 100% interest in about 125,000 tonnes of sulfur inventory at the West Pembina plant, and a 29% ownership interest in the Nisku S Pool and an 11% ownership interest in the Nisku W Pool, both of which deliver production to the West Pembina gas plant for processing.

Keyera similarly acquired an additional 7% ownership interest in its Nordegg River gas plant, bringing its ownership to 89% and an additional 11% ownership interest in the Nordegg River gas plant inlet compression, bringing its ownership to 83%.

Keyera boosted its ownership interest in various components of the Gilby gas plant by 1.7%, bringing its share to 79% and acquired an additional 1% ownership interest in its Brazeau River gas plant, bringing ownership to 92%.

Contact Christopher E. Smith at chriss@ogjonline.com.


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