September 21, 2011 [OPIS] - Provident Energy has inked deals with NOVA Chemicals Corporation to lease two underground storage caverns currently under development at the Provident Redwater Facility near Edmonton, Alberta, Canada.
Approximately one million barrels of storage is to be leased under the long-term agreements, with estimated capital cost for the caverns and associated facilities at $100 million (Canadian). On-stream dates are staged for Q3 2012 and Q1 2013.
The caverns and associated facilities were leased on a cost-of-service basis for NOVA’s exclusive use.
“Our Redwater Facility is a key growth platform for Provident and we are excited to be providing NOVA Chemicals with these new storage services,” said Doug Haughey, Provident’s chief executive officer. “Our capital spending is focused on fee-for-service business like this.”
These caverns are two of several Provident plans to develop to meet market demand for underground hydrocarbon storage in the Fort Saskatchewan area.
Provident owns and manages an NGL infrastructure and logistics business, and is based in Calgary.
