Plains Midstream Canada

Canada’s energy industry has seen more than its share of merger-and-acquisition activity this year. The latest big deal involves the midstream sector, with Keyera agreeing on June 17 to buy Plains Midstream Canada’s NGL business in Canada for C$5.15 billion ($3.75 billion). The purchase will transform Alberta-focused Keyera into a nationwide NGL machine and caps its very busy first half of 2025. In today’s RBN blog, we take a closer look at the agreement and how it ties into other recent initiatives by the Canadian midstreamer. 

With Western Canadian oil sands bitumen output increasing rapidly, producers need more diluent to blend with their production so that it can flow to market in pipelines. That means delivering diluent to remote locations as far as 250 miles northwest of Edmonton. Smaller oil sands projects typically get their diluent delivered by rail or truck but pipeline infrastructure is being built out for larger projects as their production comes online. Inter Pipeline (IPL) diluent delivery volumes on their Polaris pipeline at the end of 2013 were just 20 Mb/d. By 2017 that volume could be to 1.2 MMb/d. Today we detail IPL and Plains build out plans.

Rapid growth of heavy oil sands crude production in Alberta is prompting considerable expansion of storage and pipeline infrastructure at Edmonton and Hardisty. Less well publicized is the growth in conventional Canadian crude oil production – in many cases using horizontal drilling technology. In Saskatchewan, crude volume passing though the Kerrobert hub is increasing and a large rail-loading terminal is planned to open there in 2015 to supplement existing takeaway capacity on the Enbridge Mainline. Today we conclude our analysis of Canadian storage hubs, focusing on Kerrobert.