CALGARY, Nov. 30, 2017 /CNW/ - Keyera Corp. (TSX:KEY) ("Keyera") today announced that it has entered into 10-year gas handling agreements with Athabasca Oil Corporation ("AOC") and Murphy Oil Company Ltd. ("Murphy") to process natural gas production from their Montney and Duvernay operations west of Fox Creek, Alberta. Both gas handling agreements include take-or-pay commitments and facility dedications.
In support of these agreements, Keyera plans to enhance its Simonette gas plant operations with improved inlet liquids handling facilities and acid gas injection facilities. The investments are expected to cost between $85 million and $100 million and be operational in the first half of 2019, assuming regulatory approvals are received on a timely basis and the current construction schedule is maintained. As a result of this project, Keyera now expects to invest growth capital of between $800 million and $900 million in 2018.
To meet growing volume commitments and support additional production in the region, Keyera is also considering an expansion of the processing capacity of its Simonette gas plant. Keyera continues to have discussions with existing and new producers to understand their area development plans in order to finalize the timing and size of an expansion.
"We are pleased to have reached agreements with AOC and Murphy to support their Montney and Duvernay developments near Fox Creek, Alberta," said Bradley Lock, Keyera's Senior Vice President, Gathering and Processing Business Unit. "Both of these companies have chosen to continue building on our existing relationship in the Simonette area. The planned capital improvements at our Simonette gas plant highlight our commitment to providing reliable and competitive services with a focus on our customers' needs."
Keyera Corp. (TSX:KEY) operates one of the largest midstream energy companies in Canada, providing essential services to oil and gas producers in the Western Canada Sedimentary Basin. Its predominantly fee-for-service based business consists of natural gas gathering and processing, natural gas liquids processing, transportation, storage, marketing, iso-octane production and sales, and an industry-leading condensate system in the Edmonton/Fort Saskatchewan area of Alberta. Keyera strives to provide high quality, value-added services to its customers across North America and is committed to conducting its business ethically, safely and in an environmentally and financially responsible manner.
This news release contains forward-looking statements based on Keyera's current expectations and assumptions made by the management of Keyera relating to its business, the environment in which it operates, its future operations and the performance of its assets, including the proposed capital improvements and plant expansion at the Simonette gas plant. As these forward-looking statements depend upon future events, actual outcomes may differ materially depending on factors such as: the accuracy of the construction schedule and cost estimates; producer interest in the services being offered; timing and success of producer drilling plans; future operating results of the assets; the ability of Keyera to execute its strategic initiatives in connection with the capital improvements and plant expansion at the Simonette gas plant; availability and cost of engineering resources, construction crews and materials; timely receipt of all necessary regulatory approvals or changes in requirements; changes in production decline rates; 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 associated with gas plant operation and oil and gas production; environmental liabilities; potential delays or changes in producer development plans in the area; 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 it 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 in this release is given as of the date hereof. Readers are cautioned that they should not unduly rely on forward-looking information.
SOURCE Keyera Corp.
For further information: about Keyera, please visit our website at www.keyera.com or contact: Keyera Corp., Lavonne Zdunich, Director, Investor Relations, or Nick Kuzyk, Manager, Investor Relations, Email: [email protected], Telephone: 403.205.7670 / Toll Free: 888.699.4853