AltaGas advances British Columbian midstream projects

AltaGas Ltd. of Calgary has reached final investment decision (FID) to move forward with construction of the company’s proposed North Pine propane extraction plant about 40 km northwest of Fort St. John, BC.

Designed to serve producers in the Montney natural gas play, the North Pine will feature two separate NGL-separation trains each capable of processing up to 10,000 b/d of propane plus NGL mix (C3+) for a total of processing capacity of 20,000 b/d, said AltaGas, which will build, own, and operate the plant.

FID follows the British Columbia Oil & Gas Commission’s (BCOGC) September approval of a permit for AltaGas to proceed with the project.

Site preparation for Phase 1 of the North Pine plant—which alongside the first NGL-separation train also will include 6,000 b/d of condensate (C5+) terminalling capacity expandable to 20,000 b/d—is scheduled to begin during first-quarter 2017, for a targeted startup date in second-quarter 2018.

The second 10,000-b/d train will follow after commissioning of Phase 1, according to the company.

In conjunction with the North Pine processing plant, AltaGas also plans to build two 8-in. diameter, 40-km NGL-supply pipelines (one to carry C3+, and the other, C5+) connecting the plant to existing Alaska Highway truck terminal, the company said.

In addition, at the truck terminal, two existing 30-km NGL egress pipelines currently delivering NGL production from AltaGas' Townsend plant will connect to the new North Pine pipelines to enable NGL production from the Townsend plant to ship directly to the North Pine processing center.

AltaGas, which submitted an application for permitting of the North Pine pipelines to the BCOGC in late August, said it expects to receive permit approval for the pipelines by yearend.

Pending regulatory approval, site work for the pipelines would begin during first-quarter 2017, with commissioning of the lines to follow in second-quarter 2018.

AltaGas said it plans to complete both the North Pine processing plant and pipelines at a total cost of about $190-210 million (Can.).

Export potential

To be connected to existing AltaGas infrastructure in the region, the North Pine plant will have access to the CN rail network to enable transportation of C3+ from the plant to the company’s proposed Ridley Island propane export terminal (RIPET), near Prince Rupert, BC.

With regulatory and permitting processes for the project now under way, the proposed $400-500-million (Can.) RIPET will be located on a brownfield site subleased from Ridley Terminals Inc. (RTI) that features existing rail lines and RTI’s existing marine jetty, which offers deepwater access to the Pacific Ocean.

As currently planned, the proposed 1.2-million-tonnes/year export terminal will receive about 50-60 railcars of C3+ from across British Columbia and Alberta via the existing CN rail network and be equipped to export between 20-30 cargoes of C3+ annually to destinations abroad, offering Western Canadian propane producers new markets, particularly in Asia Pacific, according to AltaGas.

AltaGas, which already has completed front-end engineering and design on the project and received approval from Canada’s National Energy Board for a 25-year license to export up to 1.35 million tpy of C3+, said it expects to reach FID on RIPET by yearend 2016 for a targeted startup of exports in 2018.

Additional processing

In related project news, AltaGas said it also is pursuing its previously announced expansion plans for the Townsend integrated midstream complex in northeast British Columbia, in the heart of the Montney, about 100 km north of Fort St. John and 20 km southeast of the company’s Blair Creek plant (OGJ Online, Sept. 16, 2016).

To be located on the existing Townsend site adjacent to Phase 1’s recently commissioned 198-MMcfd shallow-cut natural gas processing plant, Townsend Phase 2 will include a new 100-MMcfd shallow-cut gas processing plant to produce NGL that will be shipped about 70 km to AltaGas’ proposed North Pine plant via the company’s existing and planned NGL pipelines, AltaGas said.

At an estimated cost of $85-95 million (Can.), Townsend Phase 2 would require an additional $35-45 million of incremental field-compression equipment to enable movement of raw gas production from the Blair Creek area to Townsend, according to the company.

AltaGas, which will submit its application to permit Townsend Phase 2 to the BCOGC this month, said the application also will include an upgrading plan designed to enhance liquids recovery at the existing Townsend Phase 1 plant.

With permitting approval for the project due by second-quarter 2017, and pending stakeholder engagement and other regulatory approvals, AltaGas said it expects to commission Townsend Phase 2 during fourth-quarter 2017.

The company additionally confirmed it is in the early stages of developing a 10,000-b/d C3+ processing plant intended to serve producers in the Deep basin region of northwest Alberta.

The proposed $60-80-million plant, which would be equipped to handle up to 4,000 b/d of C5+ and have access to existing rail, will be designed to connect to AltaGas’ proposed RIPET.

While it already has submitted a project application to the Alberta Energy Regulator, AltaGas did not disclose a specific timeline for when it might reach FID on the Deep basin plant.

Contact Robert Brelsford at rbrelsford@ogjonline.com.

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