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Keyera to double stake in Alberta gas plant for C$112.5M


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Keyera to double stake in Alberta gas plant for C$112.5M

Keyera Corp.has agreed to acquire an additional 35% interest in the andits associated gathering pipelines, giving it 70% ownership in the properties.

Keyera would pay BellatrixExploration C$112.5 million, subject to closing conditions, for theassets, according to a July 7 news release. The consideration includes a10-year take-or-pay commitment; an area dedication agreement; and 35%prepayment for estimated future construction costs of phase two of the O'Chiesegas plant, also called the Alder Flats plant. The acquisition is expected toclose in August.

Upon closing, Bellatrix will continue to operate thewest-central Alberta facility, which has a licensed capacity of 110 MMcf/d.

The second phase is anticipated to have a design inletcapacity of 120 MMcf/d and is targeted to be in operation in the first half of2018. Bellatrix will be in charge of the construction and fund 60% of the costs.

"The acquisition is expected to be immediatelyaccretive to Keyera's distributable cash flow per share," Keyera Presidentand CEO David Smith said in the statement. "[T]he Alder Flats Plant isexpected to remain a core gathering and processing asset for Keyera and acost-effective, networked processing solution for area producers over the longterm."