CALGARY, Dec. 19, 2014 /CNW/ - Keyera Corp. (TSX:KEY) ("Keyera") announced today that it has agreed to participate as a 60% owner in the Zeta Creek gas plant (the "Plant"), being constructed by Velvet Energy ("Velvet") in the West Pembina area of Alberta. Keyera will be the operator of the Plant, which will have a licensed capacity of 54 million cubic feet per day of sweet gas and be able to extract natural gas liquids.
As part of the transaction, Keyera will also participate as a 75% owner in the proposed sales gas lateral pipeline to be constructed from the Plant to the TransCanada mainline. Once this lateral pipeline is constructed, Keyera plans to add an additional pipeline connection between its Pembina North gas plant and this lateral, in order to help debottleneck the Pembina North facility. Based on current cost estimates, Keyera's proportionate share for construction of the Plant and the sales gas lateral (excluding the additional Pembina North pipeline) is forecast to be approximately $41 million. Velvet expects the Plant to be operational in the fourth quarter of 2015. To assist Velvet with the execution of their development plan in the area, Keyera has agreed to provide Velvet with processing capacity at another Keyera facility until the Plant is on stream.
"This area has been experiencing tremendous growth as producers target numerous liquids rich zones," said David Smith, Keyera's President and Chief Operating Officer. "With the increased production filling existing plants, this new facility will provide incremental processing capacity to serve a very active area of the province."
Keyera Corp. (TSX:KEY) 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 NGLs, the production of iso-octane and crude oil midstream activities.
Keyera's gas processing plants and associated facilities are strategically located in the west central, foothills and deep basin natural gas production areas of the Western Canada Sedimentary Basin. Its NGL and crude oil infrastructure, including pipelines, terminals and processing and storage facilities, as well as its iso-octane facility, are located in Edmonton and Fort Saskatchewan, Alberta, a major North American NGL hub. Keyera markets propane, butane, condensate and iso-octane to customers in Canada and the United States.
This document contains forward-looking statements based on Keyera's current expectations and assumptions relating to its business, the environment in which it operates, its future operations and the performance of its assets, including the proposed Plant and pipeline infrastructure. 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; future operating results of the assets; the ability of Keyera to execute its strategic initiatives in connection with the Plant and pipeline infrastructure to be constructed; risks arising from co-ownership of the Facilities; 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. 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.
SOURCE: Keyera Corp.
For further information: about Keyera, please visit our website at www.keyera.com or contact: Keyera Corp., John Cobb, Vice-President, Investor Relations, or Lavonne Zdunich, Director, Investor Relations, or Nick Kuzyk, Manager, Investor Relations, Email: [email protected]; Telephone: 403.205.7670 / Toll Free: 888.699.4853