Source: Keyera Facilities
Keyera Facilities Income Fund has entered into a long-term agreement with Husky Oil (TSX:HSE) to provide diluent transportation, storage and rail offload services in the Edmonton/Fort Saskatchewan area for the proposed Husky-operated Sunrise Oil Sands Project.
This agreement will provide Keyera with secure, long-term, feefor- service revenues and complements the diluent services agreement Keyera signed in 2009 with Imperial Oil for their Kearl oil sands project.
Under the terms of the agreement, Keyera will transport diluent by pipeline from supply sources in the Edmonton area to a diluent transportation pipeline inlet north of Fort Saskatchewan for further delivery to the Sunrise site, located 60 kilometers northeast of Fort McMurray. Keyera will also provide diluent storage and rail offload services at the Alberta Diluent Terminal (“ADT”) and the Edmonton Terminal, both owned 100% by Keyera, as well as at the Keyera-operated Fort Saskatchewan Fractionation and Storage Facility.
In addition to utilizing its existing facilities, Keyera will be utilizing capacity in the new pipeline and pumping infrastructure it is constructing in order to provide similar services to Imperial Oil for their Kearl oil sands project. Keyera expects to begin receiving fee-for-service revenues associated with the agreement with Husky in early 2014. The agreement is subject to full sanctioning of the Sunrise Oil Sands Project by Husky and its partners.
“Husky brings world class expertise in the production of heavy oil and bitumen to the Sunrise Oil Sands Project, one of the largest oil sands projects in Alberta, and we are delighted to partner with them” said Jim Bertram, President and CEO of Keyera. “This agreement with Husky demonstrates our commitment and ability to grow our oil sands services business. The investments we have made, and continue to make, strengthen our position and enhance our ability to handle the receipt, transportation and storage of diluent for oil sands producers as the oil sands sector grows.”