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TransAlta, SemCAMS Midstream to build 40-MW cogeneration plant in Alberta

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TransAlta, SemCAMS Midstream to build 40-MW cogeneration plant in Alberta

TransAlta Corp. and SemCAMS Midstream ULC announced Oct. 1 that they agreed to co-own, develop, build and operate a new cogeneration facility at the Kaybob South No. 3 sour gas processing plant in Alberta.

The Kaybob facility is in the Western Canadian Sedimentary Basin and receives natural gas production out of the Montney and Duvernay formations, according to a company news release.

The new project will have an installed capacity of 40 MW and will cost about C$105 million to build. It is expected to reach commercial operation in late 2021. The project is expected to deliver roughly C$18 million in annual EBITDA, the companies said.

All of the facility's produced steam and half of its power generation will be sold to SemCAMS under a 13-year fixed priced contract. TransAlta will sell the rest of the electric output into the Alberta grid.

TransAlta will build the cogeneration project, and SemCAMS will purchase a 50% interest in the facility once it reaches commercial operation.

SemCAMS Midstream is a subsidiary of SemGroup Corp.