Keyera Corp. to invest US$110 mln on a fractionating tower at Fort Saskatchewan facility

12-Sep-12

Keyera Corp. plans to invest US$110 mln on a fractionating tower at its Fort Saskatchewan facility with an aim to fueling Alberta’s petrochemical industry with a new source of ethane, as per fortsaskatchewanrecord.com. “We have a good understanding from our discussions that, in Alberta, the petrochemical industry is still short of ethane as a feedstock, and they have additional capacity in their facilities, said John Cobb, Keyera vice-president of investor relations. The agreement we have with our initial customer gives the confidence to proceed with this de-ethanizer.” Keyera has struck a deal with a west-central Alberta natural gas producer to extract ethane on a fee basis from the customer’s gas. The unnamed client will offer the ethane for sale to petrochemical plants in the province. The remaining propane-rich natural gas by-product will enter Keyera’s other natural gas fractionating facilities at the Fort Saskatchewan site. “We’re sort of a middle man in the process,” Cobb explained. “We’re simply charging a fee for having their gas go through our plant and having the ethane extracted. They’ll be the ones making their own deals to sell it.” The 30,000 bpd extraction tower will provide Keyera with extra capacity to extract ethane for other natural gas producers in the province. Some preliminary groundwork for the tower may take place this year, but the bulk of the construction activity will take place next year, most likely after spring breakup. The company has issued contracts for the tower and some associated equipment to be fabricated and shipped to the site for erection in 2013, and the facility is expected to become operational in the first half of 2014.