Encana, Veresen Ramp Up Natural Gas Plant in British Columbia

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Researched by Industrial Info Resources (Sugar Land, Texas)--The Tower rich-gas cryogenic processing plant near Dawson Creek in British Columbia has started up ahead of schedule and under budget, and two more Montney shale facilities are expected to ramp up later this year, Encana Corporation (NYSE:ECA) (Calgary, Alberta) and Veresen Midstream (Calgary) announced Wednesday. Industrial Info is tracking all three projects.

An agreement between Encana and Veresen Midstream enables Encana, via the Cutbank Ridge Partnership, to construct and operate the three plants on behalf of Veresen Midstream on a contracted basis. Cutbank Ridge is a partnership between Encana and Mitsubishi Corporation (Tokyo, Japan). Veresen Midstream is a joint venture by Veresen Incorporated (TSX:VSN) (Calgary) and affiliates of Kohlberg Kravis Roberts & Company. L.P. For related information, see February 22, 2017, article - Canada's Veresen Sells Power Business to Help Fund Natgas Projects.

Veresen Midstream funds and owns the three facilities, and Encana will pay to use them through a fee-for-service agreement. The agreement "provides Veresen Midstream with an attractive expected return on all invested capital through a 30-year, fee-for-service arrangement," Veresen said in a press release. Veresen Midstream said it has committed to fund as much as $4 billion of new infrastructure in the region, including gas fathering pipelines, compression and processing facilities.

Encana said the new plants will more than double its Montney liquids production from the fourth quarter of 2016 to the fourth quarter of 2017. The company's liquids and gas volumes in the play are expected to grow throughout 2018. The three plants have a combined investment value of nearly $2.3 billion. For related information, see July 24, 2017, article - Encana Grows as it Narrows Focus to Key Fields in Canada, Texas.

Now ramping up production, the Tower processing plant has the capacity to process 200 million cubic feet per day of natural gas. WorleyParsonsCord Group (Calgary) was the works contractor for the project. For more information, see Industrial Info's project report.

The two other plants are also ahead of schedule and under budget, Encana and Veresen Midstream said.

The 400 million-cubic-foot-per-day Sunrise processing plant is expected to start up by mid-October, with throughput anticipated to ramp up throughout 2018. For more information, see Industrial Info's project report.

The Saturn processing plant is expected to have one of its two 200 million-cubic-foot-per-day trains in service by yearend, followed by the second train in the first half of 2018. Fluor Corporation (NYSE: FLR) (Irving, Texas) is the engineering, procurement and construction management firm. For more information, see Industrial Info's project report.

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