AltaGas starts up midstream complex in British Columbia

AltaGas Ltd. of Calgary has fully commissioned the first phase of its Townsend integrated midstream complex in northeast British Columbia, in the heart of the Montney natural gas play, about 100 km north of Fort St. John and 20 km southeast of the company’s Blair Creek plant.

The Townsend complex, which officially opened on Sept. 14, includes a 198-MMcfd shallow-cut natural gas processing plant, a 25-km natural gas-gathering line connecting to the Blair Creek field gathering area, and two liquids-egress lines (30 km total) connecting to the associated Townsend truck terminal, AltaGas said.

The $430-million (Can.) complex, which first entered commercial operation on July 10, was completed ahead of schedule and about $40 million under budget, the operator said.

First announced in 2014, the Townsend development follows a strategic alliance between AltaGas and Painted Pony Petroleum Ltd., also of Calgary, to develop processing and marketing for natural gas and NGLs for Painted Pony’s liquids-rich Montney gas production (OGJ, June 1, 2015, p. 58).

At the time, AltaGas said it also was considering a second phase of Townsend, which would include a deep-cut system for enhanced recovery of additional NGLs and fractionation.

While precise details regarding a second phase at Townsend have yet to be confirmed, the company already has discussed the potential for building the proposed deep-cut plant with various producers in the region, according David Harris, president and chief executive officer of AltaGas.

“We certainly see the ability to double our Townsend facility, well before the end of the decade,” Harris told investors in the company’s second-quarter 2016 conference call on July 21.

“Based on our current views, we expect we could eventually get to 1 bcf of processing capacity in the region,” added Harris, without disclosing a timeframe for the possible expansion.

To date, Painted Pony has reserved all of the Townsend complex’s firm capacity, as well as that of the associated natural gas gathering line, under 20-year take-or-pay agreements.

In its 2015 annual report, AltaGas said it expected Painted Pony also would reserve all firm-liquids capacity for the related egress lines and truck terminal.

Contact Robert Brelsford at rbrelsford@ogjonline.com.

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