Initial Capacity of New Joint Venture Project Would Be 4.8 Million Barrels of Storage With Future Potential Storage Capacity of Up to 6.6 Million Barrels
HOUSTON–(BUSINESS WIRE)–Kinder Morgan, Inc. (NYSE: KMI) today announced a 50-50 joint venture with Keyera Corp. (TSX: KEY) to build a new crude oil storage terminal in Edmonton, Alberta. The joint venture owners have entered into long-term, firm take-or-pay agreements with strong, creditworthy customers to build 4.8 million barrels of crude oil storage at a new facility called the Base Line Terminal. KMI’s investment in the joint venture terminal is approximately CAD$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 CAD$69 million outside the joint venture for connecting pipelines and related infrastructure for a total project investment of approximately CAD$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.
“Kinder Morgan is excited to build this new facility with Keyera, which was made possible by leveraging the success of our previous joint venture,” said Kinder Morgan Terminals President John Schlosser. “Edmonton is playing an increasingly important role as a North American crude oil hub, demonstrated by the growth of inbound and outbound pipeline capacity. As such, it needs additional crude storage capacity, and our customers’ commitments affirm that growing need. We have the ability to further expand the facility to provide future customers with storage services in this important market. 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-barrel position in roughly a 10-year period.”
“This project is another example of Keyera and Kinder Morgan combining complementary assets and expertise to meet our customers’ needs,” said Keyera President and Chief Executive Officer David Smith. “While Keyera is contributing valuable undeveloped land, Kinder Morgan provides unparalleled connectivity to sources of crude oil in the Edmonton area.”
Kinder Morgan, Inc. (NYSE: KMI) is the largest energy infrastructure company in North America. It owns an interest in or operates approximately 84,000 miles of pipelines and 180 terminals. The company’s pipelines transport natural gas, gasoline, crude oil, CO2 and other products, and its terminals store petroleum products and chemicals, and handle bulk materials like coal and petroleum coke. Kinder Morgan is the largest midstream and third largest energy company in North America with an enterprise value of approximately $130 billion. For more information please visit www.kindermorgan.com.