Keyera acquires Whitecap gas assets
Deal, expected to close May 1, is worth $113M.
CALGARY – Keyera Corp. has acquired a number of western Alberta gas processing assets from Whitecap Resources Inc. in a deal worth $113 million.
The acquisition is expected to close on May 1, 2014.
Keyera will acquire an 85% ownership interest in the West Pembina 6-28 gas plant, including varying ownership interests in certain oil batteries, compressors and gathering pipelines associated with the plant; a 4.6% ownership interest in the Bigoray gas plant, upping Keyera’s ownership in that facility to 100%; and Nisku reserves currently tied into the Cynthia and Bigoray gas plants.
The Cynthia gas plant has a licensed capacity of 78 million cubic feet per day, and is located near the company’s Pembina North, Brazeau North and Bigoray gas plants.
The plant has a turbo expander that extracts a deep cut of ethane rich NGLs from the raw gas stream. It also has an acid gas injection facility that enables it to handle sour gas. Throughput is approximately 46 million cubic feet per day, and is largely associated gas and NGLs from Nisku oil production in the area.
The oil batteries and compressors are integral to the delivery of natural gas and NGL production to the Cynthia gas plant, along with the gathering pipelines.
Along with the gathering and processing facilities, Keyera is acquiring reserves from the Nisku geological horizon, with the associated wells producing into the Cynthia and Bigoray gas plants. Production from these wells averaged approximately 8,700 barrels of oil equivalent per day in 2013, of which about one third was crude oil and NGLs and two thirds natural gas.
Because the reserves are in the late stages of their life cycle, Keyera expects a production decline rate of between 25% and 30% annually and has no plans to drill additional wells.
Calgary-based Keyera Corp. operates one of the largest natural gas midstream businesses in Canada, consisting of natural gas gathering and processing as well as the processing, transportation, storage and marketing of NGLs, the production of iso-octane and crude oil midstream activities.