Keyera, Kinder Morgan to build new Canada crude-by-rail terminal
CALGARY, Alberta, July 30
CALGARY, Alberta, July 30 (Reuters) - Keyera Corp and Kinder Morgan Energy Partners LP announced on Tuesday a $98 million joint venture to build a crude oil rail-loading terminal in Edmonton, Alberta, one of the main storage hubs for Canada's oil sands.
The project is the latest development to cater to the growing demand among Canadian producers, frustrated by apportionment on congested pipelines, to use railways to export crude south to U.S. markets.
Midstream operator Keyera said the 50-50 joint venture rail-loading facility will be able to load about 40,000 barrels per day of crude oil and deliver to refineries anywhere in North America.
Keyera's share of the cost of the Alberta crude terminal is expected to be about $65 million, while pipeline company Kinder Morgan is expected to spend $33 million.
"Kinder Morgan's access to multiple crude streams, together with our location and facility capabilities, combines crude oil supply with the necessary infrastructure, land and rail connectivity to help address some of the crude oil delivery constraints currently being experienced by the Alberta energy sector," Keyera President and Chief Operating Officer David Smith said.
The construction of the terminal is underpinned by a five-year agreement with a major refiner, the company added.