Keyera Corporation is buying up one of Encana’s projects in the Montney region. The two companies have reached a 20 year deal that will see Keyera purchase Encana’s Pipestone liquids hub and a Pipestone processing facility currently in the works.
President and CEO David Smith says the move is part of Keyera’s plan to have more of a presence in the Montney area.
“With Pipestone and the continued build out of our Wapiti and Simonette gas plants, approximately half of Keyera’s gathering and processing margin is expected to be focused on liquids-rich Montney and Duvernay developments.”
The liquids hub is already under construction near Grande Prairie, and operations are expected to start in the fourth quarter of 2018. It will include a total capacity of 14,000 barrels of condensate a day. Keyera will pay for the rest of the facility, which is pegged around $105 million.
The planned processing facility is expected to start up in 2021 and be capable of processing a total of 200 million cubic feet per day of sour gas and 24,000 barrels per day of condensate. Encana will build it and run it at first, and Keyera will own it and will have the option to take over operations after five years. The price tag should be between $500 and $600 million.