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Keyera sanctions 1st phase of Wapiti gathering, processing project

Keyera Corp. sanctioned the first phase of its C$625 million natural gas gathering and processing complex project in the Wapiti area south of Grand Prairie, Alberta, according to a May 31 news release.

The first phase of the project is supported by agreements from its primary customer, including an area dedication and take-or-pay commitments under a long-term agreement. The project includes a 150 MMcf/d sour gas processing plant with acid gas injection capabilities and 25,000 barrels per day of condensate processing facilities. It also includes a gathering pipeline system and field compressor stations.

Keyera is now negotiating with producers in the area for additional volumes and permit sanctioning for the second phase, which would add an additional 150 MMcf/day of sour gas processing capacity and extend the gathering capacity costing about C$155 million. Additional third parties may require building additional gathering systems.

The sanctioned phase is estimated to cost about C$470 million and includes the build out of certain infrastructure needed for both phases.

Keyera expects to invest between C$800 million and C$900 million of growth capital this year. Operations are targeted to start mid-2019.