February 10, 2025 [Storage Terminals Magazine]- AltaGas Ltd. and Keyera Corp. have announced long-term commercial agreements aimed at leveraging each company’s infrastructure to enhance customer services and support sustainable growth. These agreements include a long-term tolling arrangement for Keyera on AltaGas’ global exports platform, fractionation services at Keyera Fort Saskatchewan for AltaGas, and expanded access to Keyera’s rail, storage, and logistics infrastructure. By aligning their respective assets, both companies aim to de-risk infrastructure investments and ensure that more of Canada’s energy products reach premium Asian markets.

Keyera has secured a 15-year tolling contract at AltaGas’ Ridley Island Energy Export Facility for 12,500 barrels per day of liquefied petroleum gases export capacity. This agreement builds on the existing volumes Keyera moves through AltaGas’ Ridley Island Propane Export Terminal, allowing for greater diversification of market access, particularly in high-demand Asian markets.

For AltaGas, the contract ensures long-term, stable export volumes and cash flows. With this agreement, the company has now reached its base long-term tolling target for the REEF project. Construction on REEF is progressing on schedule, with an anticipated completion near the end of 2026. Strategically positioned to reach Northeast Asia in just ten shipping days, REEF is expected to enhance the value of Canadian LPGs by accessing higher-priced international markets.

Under an 18-year agreement, AltaGas will secure 8,000 Bbls/d of fractionation capacity at KFS, including natural gas liquids from its Pipestone II plant, currently under construction. This agreement provides AltaGas with long-term fractionation capacity for its Alberta Montney volumes while also supporting Keyera’s infrastructure expansion plans.

The agreement also strengthens Keyera’s visibility on future volume commitments, supporting potential growth projects such as the proposed KFS Fractionation Unit III expansion and enhancements to rail and logistics offerings. AltaGas will have take-in-kind rights for LPG volumes at KFS and has signed a services agreement to access Keyera’s extensive rail, storage, and logistics network in Alberta’s Industrial Heartland. This integration will efficiently connect LPG volumes into AltaGas’ global exports network.

Vern Yu, president and CEO of AltaGas, emphasised the strategic importance of the partnership, stating: “We are pleased to partner with Keyera and execute long-term agreements that will improve the value of both companies’ infrastructure and ensure we’re collectively delivering the best outcomes for the Canadian energy industry. These agreements strengthen the long-term growth and predictability of cash flows for both companies and reinforce Canada’s role in supplying key Asian markets.”

Dean Setoguchi, president and CEO of Keyera, echoed this sentiment: “This collaboration with AltaGas strengthens our integrated value chain and creates more diversified sales opportunities for our customers, enabling them to consistently reach the highest value markets. Together, we are working to make the energy industry in Canada more competitive.”

Through these strategic agreements, AltaGas and Keyera are reinforcing Canada’s position as a key supplier of energy products to global markets while strengthening their respective infrastructures for long-term, sustainable growth.

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