CALGARY, Jan. 4, 2012 /CNW/ - Keyera Corp. (TSX:KEY) (TSX:KEY.DB.A)
("Keyera") announced today that it has entered into a Memorandum of
Understanding ("MOU") with a subsidiary of Enbridge Inc. ("Enbridge")
outlining terms for the creation of a joint venture (the "Joint
Venture") to pursue a rail and truck terminal and a long haul diluent
pipeline in the Athabasca oil sands area. The Joint Venture is
soliciting interest from bitumen producers in the Athabasca region of
Alberta interested in contracting for diluent transportation or
terminalling services.
The rail and truck terminal, which will be called the South Cheecham
Rail and Truck Terminal (the "Terminal"), will be located near the
Enbridge Cheecham Terminal southeast of Fort McMurray, Alberta. The
Terminal would consist of facilities to enable the receipt of diluent
or solvents via railcar for delivery to oil sands sites, and railcar
loading of diluted bitumen for delivery to refineries. Construction of
the Terminal is anticipated to begin in the second half of 2012,
assuming sufficient commitments are received, in order to provide a
diluent delivery solution for producers prior to the diluent pipeline
being constructed. In order to expedite construction of the Terminal,
clearing of land has begun, with a target to be operational by mid-year
2013. Longer term, the Terminal may provide the Joint Venture with the
opportunity to offer bitumen producers a number of other services.
The proposed diluent pipeline, to be called the Norlite Pipeline, would
begin in the Stonefell area, just north of Fort Saskatchewan, and
deliver diluent to Athabasca oil sands producers. The Norlite Pipeline
is intended to connect with Keyera's Fort Saskatchewan Condensate
System, providing shippers with access to Keyera's extensive diluent
supply points, as well as its storage and transportation infrastructure
in the Edmonton/Fort Saskatchewan area. If a decision to proceed is
made in 2012, the Joint Venture estimates that the Norlite Pipeline
could be operational in 2015.
Under the terms of the MOU, Enbridge and Keyera will have ownership
interests of 70% and 30%, respectively, in the Norlite Pipeline and
Enbridge will be the operator. Keyera and Enbridge will each have a
50% ownership interest in the Terminal and Keyera will be the operator.
"Enbridge is a proven leader in providing transportation solutions to
the energy sector," said David Smith, President and COO of Keyera
Corp. "And Keyera's storage and terminalling capabilities are very
complementary. As bitumen production increases in northeastern
Alberta, additional diluent transportation and terminalling services
will be required. Working with Enbridge, we can provide bitumen
producers with a full service package to meet their diluent logistics
requirements."
About Keyera Corp.
Keyera Corp. (TSX:KEY) (TSX: KEY.DB.A) operates one of the largest
natural gas midstream businesses in Canada. Its business consists of
natural gas gathering and processing as well as the processing,
transportation, storage and marketing of natural gas liquids (NGLs) and
crude oil midstream activities.
Keyera's gas processing plants and associated facilities are
strategically located in liquids-rich natural gas production areas of
the Western Canada Sedimentary Basin. Its NGL and crude oil
infrastructure includes pipelines, terminals and processing and storage
facilities in Edmonton and Fort Saskatchewan, Alberta, a major North
American NGL hub. Keyera markets propane, butane and condensate to
customers in Canada and the United States.
Disclaimer
This document contains forward-looking statements based on management's
current expectations and assumptions relating to Keyera's business, the
environment in which it operates, anticipated timing and closing of the
acquisitions and the future operations and performance of the assets.
As these forward-looking statements depend upon future events, actual
outcomes may differ materially depending on factors such as:
satisfaction of all conditions in the MOU with respect to proceeding
with the Terminal and/or the Norlite Pipeline (including the
negotiation and execution of applicable commercial agreements); receipt
of sufficient producer commitments to support the projects; obtaining
all necessary governmental approvals; future operating results of the
assets; future operating results; the ability of Keyera and the Joint
Venture to execute its strategic initiatives; construction and input
costs; weather conditions; commodity supply/demand balances and prices;
activities of producers, competitors, customers, business partners and
others; overall economic conditions; access to capital and financing
alternatives; operational risks in developing and producing natural
gas; and potential delays or changes in plans with respect to
development projects or capital expenditures or the results therefrom;
the legislative, regulatory and tax environment; and other known or
unknown factors. There can be no assurance that the results or
developments anticipated by Keyera will be realized or that they will
have the expected consequences for or effects on Keyera.
For additional information on these and other factors, see Keyera's
public filings on www.sedar.com. The information provided is this release is given as of the date
hereof.
