April 1, 2015 [OPIS] - Kinder Morgan Inc. (KMI) said late Tuesday that it has formed a 50-50 joint venture with Keyera Corp. to build a new crude oil storage terminal in Edmonton, Alberta.
The terminal will connect to multiple pipelines and destinations, including Kinder Morgan’s Trans Mountain Pipeline for delivery of Canadian crude to the West Coast for exports.
The joint venture owners have entered into long-term, firm take-or-pay agreements with strong, creditworthy customers to build 4.8 million bbl of crude oil storage at a new facility called the Base Line Terminal.
KMI’s investment in the joint venture terminal is approximately C$342 million (includes capitalized interest) for an initial 12 tank build-out, with commissioning expected to begin in the second half of 2017.
Separately, KMI will invest up to an additional C$69 million outside the joint venture for connecting pipelines and related infrastructure for a total project investment of approximately C$411 million.
The terminal is under development on land owned by Keyera and will be operated by Kinder Morgan.
The Base Line Terminal will be connected via pipeline to Kinder Morgan’s Edmonton terminals and will be capable of sourcing all crude streams handled by Kinder Morgan for delivery to multiple destinations, including, but not limited to, Kinder Morgan’s Trans Mountain Pipeline and two Edmonton rail terminals, and other major export pipelines.
“When this initial project is completed, we will have grown our merchant storage, exclusive of our Trans Mountain regulated storage assets, from basically zero tankage to a 12-million-bbl position in roughly a 10-year period,” said Kinder Morgan Terminals President John Schlosser.
