Keyera Corp. has agreed to buy ExxonMobils NGL midstream rail and truck terminal located near the storage hub in Mont Belvieu, Texas, the companies said on Monday.
Total cost of the acquisition and phase one modifications are anticipated to be approximately $10-15 million, according to Keyera.
The facility is located in Hull, Texas and is connected via pipeline with ExxonMobils Beaumont complex and Daisetta storage facility, and other NGL facilities near the Mont Belvieu energy hub.
The terminal is expected to be used initially to handle receipt and delivery of propane, butane, iso-butane and NGL mix for delivery into North American markets.
The transaction is subject to satisfaction of due diligence and other normal closing conditions.
The terminal is an ideal fit with our existing infrastructure, said David Smith, chief operating officer of Keyera.
Dedicated rail facilities near Mont Belvieu, combined with our rail infrastructure in Edmonton and South Cheecham in the heart of the Alberta oil sands, will allow us to enhance the logistics associated with the movement of propane, butane and condensate.
Access to high-value markets in the US and Canada is expected to provide additional new growth opportunities for Keyera.
The acquisition includes approximately 39 acres of land, four rail and six truck loading spots, and NGL storage tanks.
Keyera said it currently plans to develop and expand the terminal in phases, as demand for terminal and logistics services evolves.
Completion of the first phase, to reconfigure and place the existing equipment back into service, is expected in the first half of 2013, assuming no change in timing of execution or scope of work.
Options for future phases include expanding the rail loading and offloading capacity, adding additional pipeline connections, and expanding the storage capability in order to expand NGL activities or handle other products such as condensate and diluted bitumen.