Pembina is acquiring Canadian midstream assets with in a CA$400 million (US$295million) agreement with Veren Inc., a western Canadian gas-focused company, Pembina announced Sept. 9.
In the deal, Pembina Pipeline Corp.’s Pembina Gas Infrastructure Inc. (PGI) will take ownership of four oil batteries in Western Alberta. An oil battery is a system or arrangement of tanks built to receive raw crude from wells in the area and provide handling or processing capabilities. The batteries are built for heavier crude produced by Canadian plays.
The four batteries have a natural gas handling capacity of 320 MMcf/d and can handle 53,000 bbl/d of crude. The gas from the batteries will be sent for processing to Pembina’s Patterson Creek Gas Plant. All of the facilities are connected to PGI’s pipeline system.
Veren will continue to operate the batteries outlined in the acquisition and continue to assume operating and maintenance costs. Veren will also take over the operations of Pembina’s other batteries in the area.
Pembina has also pledged up to CA$300 million (US$221 million) towards future infrastructure projects in the area. Anticipated annual adjusted EBITDA associated with the acquisition of the batteries is expected to be approximately CA$50 million (US$37 million).
"We are thrilled to enhance and further align our strategic partnership with Veren, a top-tier growth focused Montney and Duvernay producer," said Chris Rousch, PGI’s president and CEO. "This transaction demonstrates how our collaborative approach to infrastructure solutions creates a compelling value proposition for our customers."
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