CALGARY – Keyera Corp. (TSX:KEY) has agreed to share the cost of building a new ethane-extraction gas plant in the Alder Flats area of west central Alberta in return for a 35 per cent ownership stake.
Bellatrix Exploration Ltd. is building the plant, which has a total estimated cost of $230 million including related infrastructure. Phase 1 is expected to be on stream by July and Phase 2 is will be operational by the second quarter of 2016.
Phase 1 costs to Dec. 31 are estimated at $65 million, with Keyera providing $26 million.
Each phase will be capable of handling 110 million cubic feet per day of raw natural gas, which will be processed to extract ethane, used in the petrochemical industry.
Bellatrix will operate the plant and retain a 60 per cent interest. O’Chiese Gas Plant GP Inc., a First Nations partnership, will own the remaining five per cent.
In a separate agreement, Keyera will provide Bellatrix with processing capacity at its Strachan gas plant about 100 kilometres south of the Alder Flats area. Bellatrix has secured 19 million cubic feet per day of capacity, rising to 30 million cubic feet per day on April 1, 2016.