Keyera PowerPoint Presentation · • 1,290 undeveloped acres in Alberta’s industrial heartland....
Transcript of Keyera PowerPoint Presentation · • 1,290 undeveloped acres in Alberta’s industrial heartland....
Keyera
Corp
. D
ecem
ber
2019
Corporate Profile
March 2020 Issued March 15
Forward-Looking Information & Non-GAAP Measures
2
In the interests of providing Keyera Corp. (“Keyera” or the “Company”) shareholders and potential investors with information regarding Keyera, including
Management’s assessment of future plans and operations relating to the Company, this document contains certain statements and information that are forward-
looking statements or information within the meaning of applicable securities legislation, and which are collectively referred to herein as “forward-looking
statements". Forward-looking statements in this document include, but are not limited to statements and tables with respect to: capital projects and
expenditures; strategic initiatives; anticipated producer activity and industry trends; and anticipated performance. Readers are cautioned not to place undue
reliance on forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. By their
nature, forward looking statements involve numerous assumptions, as well as known and unknown risks and uncertainties, both general and specific, that
contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur and which may cause Keyera’s actual
performance and financial results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by
the forward-looking statements. These assumptions, risks and uncertainties include, among other things: Keyera’s ability to successfully implement strategic
initiatives and whether such initiatives yield the expected benefits; future operating results; fluctuations in the supply and demand for natural gas, NGLs, crude
oil and iso-octane; assumptions regarding commodity prices; activities of producers, competitors and others; the weather; assumptions around construction
schedules and costs, including the availability and cost of materials and service providers; fluctuations in currency and interest rates; credit risks; marketing
margins; potential disruption or unexpected technical difficulties in developing new facilities or projects; unexpected cost increases or technical difficulties in
constructing or modifying processing facilities; Keyera’s ability to generate sufficient cash flow from operations to meet its current and future obligations; its
ability to access external sources of debt and equity capital; changes in laws or regulations or the interpretations of such laws or regulations; political and
economic conditions; and other risks and uncertainties described from time to time in the reports and filings made with securities regulatory authorities by
Keyera. Readers are cautioned that the foregoing list of important factors is not exhaustive. The forward-looking statements contained in this document are
made as of the date of this document or the dates specifically referenced herein. All forward-looking statements contained in this document are expressly
qualified by this cautionary statement. This document also includes financial measures that are not determined in accordance with Generally Accepted
Accounting Principles (“GAAP”). For additional information on non-GAAP measures and forward-looking statements, refer to Keyera’s public filings available on
SEDAR at www.sedar.com and available on the Keyera website at www.keyera.com.
A Leading Canadian Based Midstream Company
3
COMPANY OVERVIEW
Responsible & reliable midstream service provider• decades of operating complex facilities safely
• focused on customer service
• strong track record of financial performance & dividend growth
Highly integrated, difficult to replicate business• provide customers full range of essential midstream services
Core infrastructure strategically located in WCSB• key producing areas in liquids-rich Montney & Duvernay
• liquids infrastructure at Edmonton/Ft. Sask major liquids hub
Predominately fee-for-service cash flows• virtually no direct commodity price exposure for Gathering &
Processing and Liquids Infrastructure businesses
Low leverage provides financial flexibility • supports BBB/Stable5 credit rating enabling future growth
Meaningful ongoing growth capital investments• history of strong returns on capital
KAPS a new strategic asset providing a platform for growth
KEYERA NUMBERS AT A GLANCE1
$7.0 billion2
Market capitalization
$9.8 billion2
Enterprise value
$944 million3
2019 Adjusted EBITDA
6.0%4
Dividend yield
$700 – 800 million2020 Growth capital program
67%3
2019 payout ratio
2.7x6
Net debt/EBITDA ratio
1. All information as at December 31, 2019, unless otherwise stated. 2. As at February 28, 2020. 3. Adjusted EBITDA, Payout Ratio, return on capital, and EBITDA are not standard measures under GAAP.
See “non-GAAP Financial Measures” in Keyera’s 2019 Year End MD&A for further details. 4. Calculated using Keyera’s share price as at February 28, 2020 and annual dividend of $1.92 per common share. 5. DBRS and S&P. 6. Net Debt + 50% of hybrid subordinated debt divided by trailing Adjusted EBITDA.
Committed to Responsible Growth
4
Prioritizing our people & safety • Targeting zero safety incidents
• Recognized as a Top Employer in Canada & Alberta
Committed to corporate governance• ESG board and committee oversight
• Independent and diverse Board (>30% female directors)
Improving our environmental performance• Initiatives to reduce green house gas & methane emissions
Engaged with our communities• Volunteered >7,000 hours to community causes in 2019
• Strong relationships & partnerships with local residents &
Indigenous communities
Our Recent ESG Ratings
5
SUSTAINALYTICS
“OUTPERFORMER” RATING
MSCI
“A” RATING
Peer Benchmarking
LARGEST 5 INDUSTRY PEERS
(OIL & GAS REFINING, MARKETING,
TRANSPORTATION & STORAGE) Rating Trends
Keyera Corp. A ▲
Enbridge Inc. A ◄►
PHILLIPS 66 BBB ◄►
TC Energy BBB ◄►
Reliance Industries Limited BB ▲
Kinder Morgan, INC. BB ◄►
RATING TREND KEY: Maintain ◄► Upgrade ▲
Refiners & Pipelines (Industry Group)
6
Business is Highly Integrated & Difficult to Replicate
Raw
Gas
Gathering
Compression
Sweetening
NGL extraction
EX
TR
AC
TIO
N
CO
NS
UM
PT
IO
N
GATHERING & PROCESSING
Marketing
Ethane
Propane
Butane
Condensate
Iso-octane
Margin
En
d M
ark
ets
Oil
Sands
LIQUIDS BUSINESS UNIT
Fractionation
Storage
Transportation
~64%1 Fee for Service
1. Percentage of total realized margin for the last twelve months ended December 31, 2019. Realized margin is defined as operating margin excluding unrealized gains and losses from commodity-
related risk management contracts. Realized margin is not a standard measure under GAAP.
Gathering & Processing
Liquids Infrastructure
Under Construction
FORT
ST.JOHN
DAWSON
CREEK
FORT McMURRAY
CALGARY
EDMONTON
Simonette
South Cheecham
Terminal
Rimbey Pipeline
Fort Saskatchewan
PipelinesEdson
Ricinus
Rimbey
Strachan
Nordegg River
Brazeau River
West Pembina
Zeta Creek
Pembina
North
Alder
Flats
Minnehik
Buck Lake
Bigoray
Cynthia
Brazeau North
Josephburg Terminal
Dow Fort Saskatchewan
Keyera Fort Saskatchewan
Alberta Crude Terminal
Alberta Diluent Terminal
Edmonton Terminal
Alberta EnviroFuels
Base Line Terminal
A L B E R T AB.C.
GRANDE PRAIRIE
Pipestone
Wapiti
Infrastructure is Strategically Located
7
Full suite of services in liquids-rich Montney• Growing production in the area, driven by strong returns
• Keyera’s 3 gas plants will provide a meaningful position
• KAPS will be 1 of 2 pipelines providing liquids egress
Liquids infrastructure assets in high demand • Fractionation capacity fully utilized; storage highly utilized
• Industry-leading condensate handling system
• Keyera’s assets and connectivity are difficult to replicate
Positioned for future growth• Current capital program provides secured growth to 2022
• KAPS provides platform for next phase of growth
• 1,290 undeveloped acres in Alberta’s industrial heartland
Our Strategy & Capital Investment Considerations
8
Deliver steady
DISCIPLINED GROWTHto create long-term value for shareholders
by investing in projects that are
Complementary to our capabilities & competitive advantages
Backed by contracts that provide secure long-term cash flow
Supportive of corporate annual return on capital* of 10% - 15%
9
Capital Structure Provides Capacity & Flexibility
ISSUER CREDIT RATINGS
DBRS Limited: BBB with a Stable trend
S&P Global: BBB/Stable
2.7x NET DEBT1 TO EBITDAMidstream Peer Group3 Average >4.6x4
1. Calculated as of December 31, 2019 - Keyera methodology assumes Net Debt includes 50% of hybrid subordinated debt. For further information regarding covenant calculations, please see
Keyera’s 2019 Annual Report MD&A or copies of the note purchase agreements, all of which are filed on SEDAR. 2. All US dollar denominated debt is translated into Canadian dollars at its swap rate.3. Midstream Peer Group includes ENB, GEI, IPL, PPL, and TRP. 4. Source Peters & Co. as of February 18, 2020. 5.$600MM Hybrid Note issuance is callable after 10 years in June 2029.
LONG-TERM DEBT MATURITIES2
(excludes drawings under revolver)
$700
$600
$500
$400
$300
$200
$100
$0
2020 2021 2022 2023 2024 2025 2026 2027 2028 2029
$109$60 $30
$143 $264 $230 $400 $267
$75
Hybrid Note
Public Debt
Private Notes
C$
MM
$400 $6005
Financial Priorities
Financial Priorities Target 2019 2018 2017
Continue disciplined
capital allocation
Fee-for-Service
contribution of
Realized Margin> 75% 64% 66% 80%
Annual Return
on Capital program1 10% - 15% n/a n/a n/a
Preserve
financial flexibility
Credit ratings BBB BBB BBB BBB
Net Debt / Adjusted
EBITDA1,2 2.5x - 3.0x 2.7x 2.7x 2.4x
Long-term
dividend Payout Ratio 50% - 70% 67% 56% 61%
Grow dividend steadily
10
1. Not standard measures under GAAP. See “Forward-Looking Information & Non-GAAP Financial Measures” slide. 2. Net Senior Debt + 50% of hybrid subordinated debt divided by trailing Adjusted EBITDA.
Growing Fee-for-Service Realized Margin
11
Fee-for-Service Realized Margin*
Non Fee-for-Service Realized Margin*
61%67%
80%
64%
76%
2015 2016 2017 2018
Using mid-point of base marketing
guidance
66%78%
* Non Fee-for-Service & Fee-for-Service Realized Margin are rolling LTM. With the adoption of IFRS 16, Lease Expenses are excluded from Realized Margin as of 01/01/2019. Historical
Realized Margin has not been adjusted. Non-Fee-for Service & Fee-for-Service Realized Margin are not standard measures under GAAP. See “Forward-Looking Information & Non-
GAAP Financial Measures” slide.
2019
$612
$1,054
million
million
$407million
$670million
4%
4% 11%
22%59%
5%
23%
32%
29%
11%
13%
13%
18%34%
22% Secured
AA- to AA+
A- to A+
BBB- to BBB+
Non-IG
Keyera's Credit Worthy Customer Base
12
Gathering & Processing Liquids Infrastructure Marketing
Consolidated*
* Based on 2019 revenues to December 31, 2019. Counterparty credit ratings at March 12, 2020. Secured category includes, counterparties who have prepay terms or a posted letter of credit. Parent's
credit rating used when parental guarantees exist.
15%
14%
18%37%
16%
Creditworthy counterparties
• Majority of revenue from investment grade/secured and
split rated counterparties
Mitigating credit risk
• Letters of credit, netting agreements, pre-payments
Broad domestic & international customer base
• Over 125 different fee-for-service customers
GATHERING &
Processing
Providing a Full Suite of Services in the Montney
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Handle all products produced• condensate stabilization
• sour gas processing
• liquids extraction
• acid gas disposal
• water handling capacity
Integrate NGL egress via KAPS
Interconnect our plants to
enhance reliability & flexibility
Grande Prairie
Pipestone
Wapiti
Simonette
A L B E R T A
Wapiti Pipeline
North Cabin Pipeline
North Wapiti Pipeline
System
MONTNEY
DUVERNAY
Gas plant
Gas pipeline
NGL pipeline
NGL pipeline under construction
Source: Scotiabank 2019 Playbook. IRR reflects mid-cycle returns.
Source: RBC Capital Markets. Alberta Fairway is the Montney liquids-rich area
where Keyera’s Simonette, Wapiti, & Pipestone gas plants and KAPS assets are
located.
MONTNEY
PRODUCTION GROWTH
Alberta
Fairway
2.4 bcfe/d
0.6 bcfe/d
Q3 20192014
Producers Investing in the Montney
15
+1.8 bcfe/d
Karr /
Pipestone
Montney
0%
10%
20%
30%
60%
70%
Kaybob
Duvernay
Elmworth
Montney
Bigstone /
Placid
Montney
50%
40%
US$65/bbl WTI
US$55/bbl WTI
US$45/bbl WTI
MONTNEY REGION
RETURNS
Are
a I
nte
rnal
Rate
of
Retu
rn (
%)
Optimizing our Portfolio in West Central Alberta
16
Objective
Increase competitiveness &
profitability
Reduce costs & increase utilization• reduce redundant costs
• attract volumes to most efficient facilities
• increase liquids recoveries
• preserve capacity for recovery
DEEP BASIN
A L B E R T A
MONTNEY
DUVERNAY
Rimbey
14 gas plants
2.1 bcf/d capacity
49% utilization*
Edmonton
Calgary
Fort Saskatchewan
Gas plant
Gas pipeline
NGL pipeline
NGL pipeline under construction
* Based on licensed capacity and includes the Gilby plant, where operations have been suspended.
LIQUIDS
Infrastructure
18
KFS – Integrated Fractionation & Storage Assets
ASSETS & CONNECTIVITY DIFFICULT TO REPLICATE
KFS FRACTIONATION CAPACITY FULLY UTILIZED
One of four fractionation service providers in Fort Saskatchewan
65,200 bbls/d C3+ capacity & 30,000 bbls/d C2+ capacity
LARGEST UNDERGROUND STORAGE POSITION IN WCSB
~15 million barrels of storage capacity in high demand
expansion program underway to add new caverns over the next few years
COMPETITIVE ADVANTAGES
Connectivity provides customers with flexibility
Storage provides customers with reliability
Integration provides customers competitive services difficult to replicate
FUTURE GROWTH OPPORTUNITIES
Fractionation and Storage
~1,300 acres of undeveloped land nearby for future development
Keyera Fort Saskatchewan (KFS)
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Our Industry-Leading Condensate System
KAPS
PEMBINA
NEXUS
COLD
LAKE
SUNCOR
REFINERY
SOUTH GRAND RAPIDS PIPELINE
CANADIAN
DILUENT HUB
CRW
ACCESS
PIPELINE
COCHIN
ADT
KFS
KET
PEMBINA
PLAINS
CRW, GIBSON,
TRANSMOUNTAIN
FORT
SASKATCHEWAN
PIPELINE
DOW
RIMBEY
JOSEPHBURG
SOUTHERN LIGHTS
IPL POLARIS
PIPELINE
FORT SASKATCHEWAN
CONDENSATE SYSTEM MANIFOLD NORLITE
NORTHWEST
REDWATER
20 Source: Keyera internal estimates & company reports. Wood Mackenzie for oil sands demand and forecast.
Keyera has significant
condensate storage capacity
65-70%Keyera
Peers
Keyera transports > 50%
of oil sands demand
2017
bb
ls/d
Perc
en
tag
e o
f T
ota
l D
em
an
d
0%
Oil sands demand
Oil sands forecast
60%
40%
2018 2019 2020 2021 2022
Volume % transported
on Keyera’s system
Leading Condensate Service Provider
0
200,000
400,000
600,000
800,000
80%
100%
20%
Strong Fundamentals Support Continued Growth
Source: CAPP 2019 Bitumen Forecast21
BITUMEN
PRODUCTION GROWING
CONDENSATE
SUPPLY vs DEMAND
2010
0
mb
bl/d
1,000
2,000
3,000
4,000
2015 2020 2025 2030
Oil Sands Mining
Oil Sands In-Situ
2020
0
mb
bl/d
200
400
600
800
1,200
WCSB Supply Forecast
Demand Forecast1,000
2025 2030 2035 2040
Condensate
Imports
WCSB
Condensate
Production
Source: Condensate forecast Wood Mackenzie
22
KAPS will Provide NGL Connectivity From Montney
A L B E R T A
Edmonton
Fort
Saskatchewan
Grande Prairie
Pipestone
Wapiti
KFS
OIL SANDS
MONTNEY
DEEP BASIN
DUVERNAY
SimonetteKAPS
Keyera
SemCAMS
KAPS – Key Attributes
Secure, long-term cash flow with 75% take-or-pay
Strong return on capital* of 10% - 15%, starting in 2024
Highly desired by industry
Direct connection to oil sands diluent demand
Easily integrated with owners’ gas plants
Upstream & downstream benefits
Creates a new platform for growth
23 * See “Forward-Looking Information & Non-GAAP Measures” slide.
MARKETING
MARKETING CREATES VALUE
25
Knowledge, Relationships and Infrastructure
C3 C2C4C5+iC8
$180M - $220MANNUAL BASE GUIDANCE*
WHAT WE DOBuy and Sell NGLs
Lock in sales margins and supply costs
Protect the value of our inventory
Upgrade low value products, incl C4 to iC8
Use our infrastructure to take advantage of
opportunities
WHAT WE DON’T DOSpeculative trading
Financial trading without physical product
Take frac spread exposure
* Refer to Keyera’s 2019 Year End MD&A for the assumptions. See “Forward-Looking Information & Non-GAAP Measures” slide.
STRATEGIES
GOALS
HOW WE MANAGE RISK
26
Intense Focus on Risk Management
INVENTORY RISKStored inventory is exposed to market
price fluctuations from when it is
purchased to when it is ultimately
sold, consumed, or blended
BASIS RISKCommodity purchases and
sales can be priced on different
price indexes
Protect the value of our inventory from market price fluctuations
Use physical and financial contracts to protect a high proportion of stored inventory
Reduce basis risk by aligning purchases and sales transactions on the same index
Use basis spreads to convert exposure from one index to another; match the purchases and sales indexes
27
Marketing Utilizes our Infrastructure to Create Value
C5+ CONDENSATE• Keyera’s C5+ hub creates industry liquidity
• Consumed in Alberta as diluent for bitumen
• Significant imports required to meet demand
C2 ETHANE• Sold under long-term agreements to
petrochemical producers in Alberta
• Limited spot market in western Canada
• Produced at three Keyera facilities
C3 PROPANE• Demand and pricing vary seasonally
• Keyera uses its storage and logistics to
access markets
• Majority sold into U.S. markets
• Supply exceeds demand in North America
C4 BUTANE• Sourced and consumed in Alberta
• Feedstock for iso-octane production at
Alberta EnviroFuels
iC8 Iso-octane• High quality gasoline additive
• Produced from butane at Keyera’s Alberta
EnviroFuels facility
• Majority of sales in the U.S.
28
Upgrading Butane into High Value Iso-octane
WTI
RBOB premium
Iso-octane premium
upgraded
value
STRONG CONTRIBUTORTO MARKETING*
ISO-OCTANE DEMANDIS STRONG
Superior gasoline blend stock pricing
• Lower RVP & higher octane than alternatives
• Clean burning additive with virtually no sulfur,
aromatics or benzene
Strong demand for iso-octane
• Iso-octane <1% of gasoline blend stock demand
• AEF only merchant facility in North America
• Refineries producing lower octane gasolines
• Qualities to meet changing gasoline specs
* Bar chart for illustrative purposes only; components of upgraded value do not represent actual size; cost of Butane assumed to range between 25% - 50% of WTI.
Butane
Feedstock Cost
(% of WTI)
WTI
RBOB premium
Iso-octane premium
Feedstock
29
Leveraging Our Infrastructure to Create Value
KEYERA’S
NORTH AMERICAN
VALUE CHAIN
GULF COAST MARKET
BAKKEN
CONWAY MARKET
C3C4iC8
C4C3
C3
C5
FINAL
Word
8%dividend/share
CAGR1,3
10%distributable cash
flow/share CAGR2,3
19%total annual
shareholder return2,4
31
Delivering Impressive Returns
1. Compound annual growth rate from 7/15/2003 to 12/31/2019. 2. Compound annual growth rate from 5/30/2003 to 12/31/2019. 3. Not standard measures under GAAP. See “Forward-Looking
Information & Non-GAAP Measures” slide. 4. Includes reinvestment of dividends.
What to Expect From Keyera
32
AN INCREASE IN BASE GUIDANCE2
Wildhorse completed and generating strong returns
New Galena Park investment generating strong returns
Opportunities associated with KAPS
Selectively pursue new high value niche opportunities
STEADY, DISCIPLINED GROWTH
Success with KAPS
Additional fractionation & storage capacity
Increased utilization of our condensate system
Integrated, complementary growth
Marketing
2020 2022
Pipestone
Gas Plant
Wildhorse
Terminal
Wapiti
Phase 2
Wapiti
Phase 1
Simonette
Expansion
20212019 2022 - 2024
retu
rn o
n c
ap
ital1
10% - 15%
INCREASED PROFITABILITY
Success with Montney build-out
Increase utilization of West Central Alberta portfolio to > 60%
Selectively pursue growth opportunities
Gathering & Processing
Liquids Infrastructure
1. Not a standard measure under GAAP. See “Forward-Looking Information” & “None-GAAP Financial Measures” slide. 2. Base guidance is $180 million to $220 million annually. Refer to Keyera’s 2019 Year End Report MD&A for the assumptions.
Contact Information
33
www.keyera.com
Lavonne Zdunich, CPA, CA
Director, Investor Relations
Calvin Locke, P.Eng, MBA
Manager, Investor Relations
Beata Graham, CPA, CMA
Senior Analyst, Investor Relations
888-699-4853
Keyera Corp.
Sun Life Plaza West Tower
200, 144 4 Avenue SW
Calgary, Alberta
T2P 3N4
APPENDIXOur Assets
35
Growth Projects Currently Under Development
Approved Projects Capital Cost (Net, in $ Millions)1
2020 2021 2022
Wapiti Gas Plant Complex 1,000
Wapiti Phase I (including Water Disposal System) and NWPS Phase I COMPLETE
Wapiti Phase II and Compressor & Gathering System Expansion
Simonette Acid Gas Injection & Inlet Enhancements 80 COMPLETE
Simonette Plant Expansion 71 COMPLETE
Pipestone Plant (Phase I) 600
Wildhorse Terminal US197
Storage Cavern Development Program at Keyera Fort Saskatchewan2 125
KAPS2 650
Sulphur Handling Project2 58
TOTAL ~$2.9 Billion $1.7 Billion Invested as of December 31, 2019
1. Keyera’s share of estimated capital cost. See Keyera’s 2019 Year End Report MD&A for capital investment risks and assumptions. 2. Projects expected to be completed in 2022 subject to timely receipt of regulatory approvals and construction schedule variables.
36
Simonette Gas Plant – Supporting Montney & Duvernay
INFRASTRUCTURE INCLUDES450 mmcf/d of gas processing capacity
27,000 bbls/d of condensate handling facilities
Backed by gas handling agreements, including take-or-pay
commitments and facility dedications
GAS PLANT EXPANSIONIncreased processing capacity by 150 mmcf/d
Project completed 3Q19
ACID GAS INJECTION & OTHER ENHANCEMENTSAcid gas injection is the most reliable and environmentally
responsible method to dispose of acid gas, virtually eliminating
emissions
Project became operational in July 2019
GROWTH OPPORTUNITIESAbility to connect to Keyera’s Wapiti gas plant
GRANDE
PRAIRIE
Pipestone
Simonette
Wapiti Pipeline
North Cabin
Pipeline
North
Wapiti
Pipeline
System
Wapiti
Capture Area
Producers active in
Wapiti Area:
• CNRL
• NuVista
• Paramount
• Pipestone Energy
• Seven Generations
• Shell
• Sinopec
37
Wapiti Gas Plant Complex – Phase I Operating
INFRASTRUCTURE INCLUDES300 mmcf/d of sour gas processing capacity
25,000 bbls/d of condensate handling capacity
30,000 bbls/d water disposal system
A raw gas gathering and field compression system
Acid gas injection, the most reliable and environmentally
responsible method to dispose of acid gas, virtually eliminating
emissions
PHASE I 150 mmcf/d - FULLY CONTRACTEDLong-term gas handling agreement with Paramount
Includes area of dedication and take-or-pay commitments
PHASE II TO BE COMPLETED MID-20201
Incremental 150 mmcf/d of sour gas processing capacity
Compressor and gas gathering system expansion
Long-term gas handling agreements with Pipestone Energy
Includes take-or-pay commitments
GROWTH OPPORTUNITIESAbility to connect to Keyera’s Simonette & Pipestone gas plants
1. Project timing subject to timely receipt of remaining regulatory approvals and construction schedule variables.
38
Pipestone Gas Plant – On Schedule & Fully Contracted
STRATEGIC PARTNERSHIP WITH OVINTIV
Major gas producer focused on developing the liquids-rich Montney;
contracted 85% of the available capacity
Keyera will own the facilities with the option to operate after five years of
plant start up
Expected to be completed in early 2021 at a cost of $600 million1
NEW INFRASTRUCTURE INCLUDES
200 mmcf/d of sour gas processing capacity
24,000 bbls/d of condensate processing facilities
Liquids hub with an additional 14,000 bbls/d of condensate processing
capacity (completed in 2018)
Acid gas injection, the most reliable and environmentally responsible
method to dispose of acid gas, virtually eliminating emissions
PHASE I 100% CONTRACTED & BACKED BY LONG-TERM AGREEMENTS
Includes an area dedication and revenue guarantee from Ovintiv
In May, 2019 new customer contracted available capacity with long-term
take-or-pay commitment
GROWTH OPPORTUNITIES
Ability to expand gas plant by 200 mmcf/d
Ability to connect to Keyera’s Wapiti gas plant
1. Project timing and cost subject to timely receipt of regulatory approvals, completing engineering & cost estimates, and construction schedule variables. Estimate excludes the cost of the Liquids Hub.
Source: Peters & Co.
Pipestone Liquids Hub & Plant
39
Wildhorse – Strategic Crude Oil & Blending Terminal
STRATEGIC CRUDE OIL STORAGE AND BLENDING TERMINAL1
Located at the major crude oil hub in the US
Backed by fee-for-service take-or-pay storage contracts ranging
from 2 - 6 years in length
Provides significant commercial opportunities by blending lower
value products into higher value product streams
Leverages Keyera’s liquids handling expertise
NEW INFRASTRUCTURE INCLUDES12 crude oil storage tanks with 4.5 million barrels of working
storage capacity under construction
Terminal will initially be pipeline connected to two existing storage
terminals in Cushing, OK
EXPECTED TO BE IN SERVICE IN 2H20, NET CAPITAL COST OF US$197 MILLION2
GROWTH OPPORTUNITIESComplemented by acquisition of Oklahoma Liquids Terminal, a
nearby logistics and diluent blending facility
Subject to customer demand, site allows for additional tanks
Cushing, OKUnparalleled connectivity
with 90 mmbls of storage
Wildhorse
Terminal1. 90/10 joint venture with an affiliate of Lama Energy Group.2. Cost and timing subject to construction and schedule variables.
40
Positioned for Future Development
1,290undeveloped acres
in Alberta’s Industrial
Heartland
KFSJosephburg
Rail Terminal