Keyera doubles ownership stake in Alberta gas plant

Keyera Corp., Calgary, has closed on its previously announced deal to acquire additional ownership interest from partner Bellatrix Exploration Ltd., also of Calgary, in the O’Chiese Nees-Ohpawganu’ck (Alder Flats) deep-cut natural gas processing plant and related pipelines in west-central Alberta (OGJ Online, July 8, 2016).

Finalized on Aug. 9, the transaction includes Keyera’s acquisition of an additional 35% interest in the gas plant and associated pipelines from Bellatrix for a total cash payment of $112.5 million, as well as prepayment of 35% of future construction costs for a second phase of the plant Bellatrix currently is building, said Keyera.

As part of deal, the companies also have entered a midstream services and governance agreement under which Bellatrix will have exclusive access to the purchased capacity—about 80.5 MMcfd post-commissioning of Phase 2—for a term of 10 years.

With its purchase completed, Keyera now holds 70% ownership interest in the Alder Flats project.

Alongside retaining a 25% ownership interest and continuing on as acting operator, Bellatrix also maintains an option to reacquire a 5% interest in the gas plant at a cost of $8 million near expiry of the Alder Flats construction, ownership, and operating agreement.

Due to be on stream during first-half 2018, Phase 2 will add a design inlet capacity of 120 MMcfd to the project’s Phase-1 capacity of 110 MMcfd, which came on stream in mid-2015.

Contact Robert Brelsford at rbrelsford@ogjonline.com.

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