Meritage announces construction of crude oil and natural gas infrastructure in Canada

Source:Meritage Midstream Services

Meritage entered into agreements to build natural gas gathering, compression and processing assets and a crude oil gathering pipeline to serve production in the Alberta Deep Basin, including the Montney and Duvernay shale plays.

Meritage Midstream Services (“Meritage”) announced today that its Canadian affiliate, Meritage Midstream Services III, LP (“Meritage III”), has entered into definitive agreements with Canadian International Oil Corporation (“CIOC”) to build natural gas gathering, compression and processing assets and crude oil gathering assets to support the development of CIOC’s Montney and Duvernay Shale positions in west-central Alberta. Meritage III will provide 75 million cubic feet per day (MMcf/d) of gas gathering and processing capacity, which will be expandable to 225 MMcf/d, and up to 10,000 barrels per day (bpd) of crude oil gathering capacity.

Construction of both systems began in May. The 42-kilometer high-pressure gas gathering system will deliver rich gas to the new processing plant, which will be located approximately 60 miles south of Grand Prairie, Alberta. The plant is expected to come into service in April 2016 and will offer connections for residue gas to the TransCanada Pipeline and other delivery points. The 37-kilometer crude oil gathering system follows the same route as most of the gas gathering pipeline and will connect to Pembina Pipeline Corporation’s Karr Lateral pipeline, which will serve Pembina's terminal in the Lator area of northwest Alberta.

“The Montney and the Duvernay are poised to become two of the most prolific plays in North America, and CIOC is one of the most prominent and active oil and gas operators in Western Canada. These important agreements establish our position in the region and allow us to continue to focus on developing the infrastructure needed to stay ahead of the immediate and long-term needs of our Canadian customers,” said Meritage CEO Steve Huckaby, who also serves as CEO of Meritage III.

“We are excited to be working with Meritage as a well-established midstream service provider for CIOC. Meritage has an outstanding team, and based on their strong ability to execute and provide their customers with the highest level of service in other basins, we have a high degree of confidence in their abilities. They have a track record as business partners and problem solvers who are there to create value for their customers. That approach is very meaningful in any environment, particularly a challenging one,” said CIOC President and CEO Scott Sobie.

Michael Hantzsch to Lead Meritage Midstream’s Canadian Headquarters

Meritage also announced that industry veteran Michael A. Hantzsch has joined the company as senior vice president, Canada. Mr. Hantzsch has more than 37 years of experience in the energy industry with a focus on Canada. He will lead Meritage’s Canadian office, which will open soon in Calgary. Mr. Hantzsch started his career with Shell Canada Limited and has held senior positions with a number of energy companies including Williams Energy, Provident Energy and, most recently, Pembina Pipeline Corporation.

While at Williams he was responsible for managing the company’s initial interest in the Alliance Pipeline Project and later played a key role in the purchase of TransCanada Midstream’s NGL business. In September 2000, he became vice president, business development of Williams Energy (Canada), Inc. and was responsible for identifying and implementing acquisition and investment opportunities consistent with Williams’ growth strategy for Canada. He later joined Provident Energy as vice president, business development. Mr. Hantzsch led the $750 million acquisition of EnCana’s NGL business, the largest acquisition in the company’s history. More recently, he was responsible for the purchase of Dow’s hydrocarbon storage and distribution facility in Corunna, Ontario, and for leading the evaluation of several large midstream acquisition opportunities. After the 2012 acquisition of Provident Energy by Pembina Pipeline Corporation, Mr. Hantzsch assumed the role of vice president, oil sands and heavy oil, where he was responsible for operational management and commercial oversight for Pembina’s oil sands and heavy business unit. He retired from Pembina Pipeline in December 2014.

Mr. Hantzsch is a graduate of the University of Toronto, where he earned a Bachelor of Science degree with honors in chemical engineering. He has been a member of the Association of Professional Engineers and Geoscientists of Alberta (APEGA) since 1980 and has been an active member of the Ukrainian community all his life.

“It took the best of the best to bring me out of retirement. I have tremendous respect for the Meritage team and the company’s outstanding track record. The opportunity to join Meritage and help grow the Canadian business unit from the ground up is very exciting and one I just couldn’t pass up,” Mr. Hantzsch said.

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