Keyera Facilities Income Fund through a subsidiary has agreed to acquire a distribution terminal in the Edmonton/Fort Saskatchewan energy hub for $32 million as part of a $50 million growth initiative.
CALGARY
Keyera Facilities Income Fund through a subsidiary has agreed to acquire a distribution terminal in the Edmonton/Fort Saskatchewan energy hub for $32 million as part of a $50 million growth initiative.
The facility, to be known as the Alberta Diluent Terminal (ADT), will be used primarily to handle condensate, for use as diluent in the oilsands sector. The transaction is subject to normal commercial conditions and is expected to close no later than mid April.
The ADT will increase Keyera’s condensate import capacity in the Edmonton/Fort Saskatchewan hub by a factor of five, to over 60,000 barrels per day, and will enable Keyera to continue as a key diluent supplier in Alberta as bitumen production grows. With its existing rail and storage capabilities, the site can become operational, on a limited basis, almost immediately. This provides significant cost and time advantages relative to a greenfield development.
The ADT consists of a 42-acre parcel of land located just north of Keyera’s Edmonton Terminal. Located on the site is a rail offloading/loading rack with 20 spots, providing the capacity to handle 80 rail cars per day, rail storage spurs able to handle 200 rail cars, access to the Canadian National and Canadian Pacific railways, a truck loading rack and 435,000 barrels of product storage in six above-ground steel storage tanks.
Keyera also announced plans to invest $18 million to fully integrate the facility with its NGL Infrastructure. Keyera intends to construct two 4-kilometre pipelines from the ADT facility to its Fort Saskatchewan pipeline system, connecting its Edmonton terminal and its Fort Saskatchewan fractionation and storage facility.
When the pipeline connections are complete, Keyera will be able to deliver product to market on a number of pipelines, or to Keyera’s storage facility in Fort Saskatchewan.
The ADT will also significantly enhance the operational flexibility of Keyera’s existing logistics and storage businesses in the area, allowing products to be received in much higher quantities.
DCN News Services
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