Houston-based Plains All American Pipeline is selling the entirety of its Canadian NGL assets to Keyera for US$3.75 billion (CA$5.15 billion).

Keyera will also be purchasing select U.S. assets. Plains will continue to hold its U.S. NGL assets and Canadian crude assets.

The transaction is expected to close in early 2026.

Canadian-based Keyera said the transaction gives the company a fully connected NGL corridor across the full width of Canada.

“This is a highly strategic acquisition that strengthens our core business and accelerates our growth trajectory," said Keyera President and CEO Dean Setoguchi in Keyera’s statement.

Keyera has undertaken several gas-processing expansion projects recently, including a 47,000 bbl/d addition at its KFS facility in Alberta.

From its Alberta hub, the company will have West Coast access to LPG export terminals, as well as hubs in eastern Canada and the U.S., according to the announcement.

Keyera said the deal was “transformational” for the company. The enhanced NGL platform will provide more flexibility, reliability and cost-effective solutions to its customers, the company said. 

Keyera expects the deal to enhance the company’s growth outlook, estimating that pro forma, fee-based adjusted EBITDA to grow by approximately 50% in the first full year. Keyera expects further growth through synergies and the completion of projects currently under construction.

For Plains All American, the sale focuses the company’s Canadian midstream assets on oil delivery with the goal of squeezing out system efficiencies. Plains also expects the deal will make the company’s cash flow less seasonal and capital dependent.

“Successful completion of this transformative transaction advances our efficient growth strategy and establishes Plains as the premier pure play crude oil midstream entity with highly strategic assets linking North American supply to key demand centers,” said Willie Chiang, chairman and CEO, in Plains’ press release.

Plains expects proceeds from the deal to be approximately $3 billion net after taxes, transaction expenses and a potential one-time $0.35 special distribution, the company said in its announcement. The special distribution is intended to offset potential individual tax liabilities associated with the transaction and is subject to board approval, tax implications and closing of the transaction, according to the announcement.

Plains said it will use the proceeds for bolt-on M&A deals to extend and expand the company’s crude-focused portfolio and capital structure optimization.

Keyera will partially fund the deal through an offering of 5.9 million subscription receipts at a price of US$28.62 (CA$39.15) per subscription receipt for gross proceeds of approximately US$1.3 billion (CA$1.8 billion). Each subscription receipt equals one common share upon the deal’s closing.

The subscription offering is expected to close on June 20 and the proceeds will be held in escrow by Odyssey Trust Co.

Joint bookrunners leading the offering include RBC Capital Markets, CIBC Capital Markets, National Bank Financial Inc., Scotiabank and TD Securities Inc.

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