CALGARY, July 12 /CNW/ - Keyera Facilities Income Fund
(TSX:KEY.UN; KEY.DB) ("Keyera") announced today that it has initiated a
project to extract ethane from the raw natural gas processed at its Rimbey gas
plant in west central Alberta. The $26 million project will involve plant
modifications and the construction of a 32-kilometre pipeline to deliver the
product to existing ethane gathering infrastructure in Alberta. Project
completion is expected in the third quarter of 2008. When operational, Keyera
will extract about 5,000 barrels per day of ethane, the majority of which will
be incremental to existing supply in the province of Alberta.
The project involves the modification of the existing natural gas liquids
extraction process at the Rimbey gas plant and the installation of new
compression equipment. Plant tie-ins and some modifications were completed
when the Rimbey gas plant was off-line in June for its scheduled maintenance
turnaround. A pipeline route has been chosen and discussions with stakeholders
are being initiated.
The ethane supply will be sourced from existing raw gas delivered to the
Rimbey plant for processing. Keyera has entered into a commercial arrangement
outlining the terms for the sale of the ethane from the project to Dow
Chemical Canada Inc., a major ethane consumer in Alberta. The project is
subject to a number of conditions, including the receipt of regulatory
approvals.
"This project is another example of how we are able to utilize our
existing facilities and operational expertise to capture new complementary
opportunities", said Jim Bertram, President and CEO of Keyera. "In addition,
the development of an incremental source of ethane helps to meet the long-term
supply requirements of Alberta's petrochemical industry."
"With this arrangement, we are able to address our need for long-term,
affordable ethane feedstock," said Jeff Johnston, President of Dow Chemical
Canada. "We intend to submit this project as one of the first under
consideration under the new Government of Alberta incremental ethane
extraction policy," noted Mr. Johnston.
The Rimbey gas plant is Keyera's largest gas processing facility and a
key energy complex in west central Alberta. Keyera is the operator of the
plant and holds an 86.4% ownership interest. With a raw gas processing
capacity of 422 million cubic feet per day and 2,500 km of gathering
pipelines, the plant's extensive capture area allows it to provide energy
processing services to a large number of producers. The Rimbey plant currently
produces sales quality natural gas and specification grade propane, butane and
condensate. In addition, it also produces frac oil and up to 285 tonnes per
day of liquid CO(2), both of which are used in the well servicing industry in
Alberta. The Rimbey plant is connected to sales gas transportation pipelines
and has NGL rail and truck loading and offloading facilities for natural gas
liquids. As well, the Rimbey plant delivers specification propane, butane and
condensate via pipeline to Keyera's logistics terminal and storage facility in
the Edmonton/Fort Saskatchewan energy hub.
About Keyera Facilities Income Fund
Keyera Facilities Income Fund (TSX:KEY.UN; KEY.DB) 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 the west central and foothills natural gas production
areas of the Western Canadian 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.
This document contains forward-looking statements that involve known and
unknown risks and uncertainties, many of which are beyond Keyera's control.
The forward-looking statements are based on management's current expectations
and assumptions relating to Keyera's business and the environment in which it
operates. As the results or events predicted or implied in these
forward-looking statements depend upon future events, actual results or events
may differ materially from those predicted. Some of the factors which could
cause actual results or events to differ materially include the ability of
Keyera to successfully implement strategic initiatives, whether such
initiatives yield the expected benefits, operating and other costs, future
operating results and the components of those results, fluctuations in the
demand for natural gas, NGLs (including ethane) and crude oil, the activities
of producers, competitors and others, the weather, overall economic conditions
and other known or unknown factors. In addition, the forward-looking
information with respect to the ethane extraction project will depend upon,
among other things, construction schedules and costs, regulatory approvals,
satisfaction of conditions precedent in the commercial arrangement for the
sale of the ethane, the outcome of the review of ethane extraction conventions
in Alberta and the impact of other government and industry initiatives. 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. Unless otherwise required by
applicable laws, Keyera does not intend to publicly update or revise
forward-looking statements, whether as a result of new information, future
events or otherwise.
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