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Williams sells Canadian assets for CAD$1.35 billion to Inter Pipeline

HOUSTON, August 8, 2016 (PCW) –- Williams on Monday said it had sold its NGL and midstream assets to Calgary-based firm Inter Pipeline for CAD$1.35 billion (US$1.03 billion). The deal also includes the proposed propane dehydrogenation unit that Williams had proposed in Alberta.

In a separate statement, Inter Pipeline said it expected the deal to close in the third quarter.

The assets include two liquids extraction plants located near Fort McMurray, Alberta, a fractionator near Redwater, Alberta, and a pipeline system that connects these facilities. The two plants have a capacity of 40,000 b/d and olefins from the upgrader offgas. The ethane-ethylene mix is sold to NOVA Chemicals under a long-term fee based contract which commenced in late 2013. The remaining NGL and olefinic products are distributed by third-party pipeline, truck and rail and sold to various North American counterparties, Inter Pipeline said.

The potential $1.85 billion PDH unit would be located near the Redwater fractionator and is expected to have a capacity of 1.2 billion lbs/yr. Williams has invested about $250 million in the proposed facility.

Inter Pipeline said Monday it expects to make a final investment decision on this the by the end of 2016. Should it move ahead, the project is expected to be operational in 2020.

Prior to this sale, Williams has signed an agreement with privately-held North American Polypropylene, which is an affiliate of private equity firm Goradia Capital, which will purchase 990,000 million lb/yr of PGP on a 25-year term firm fee for service basis for the production of homopolymer polypropylene. NAPP’s PP project will be located on the same site as the PDH unit. -- Samantha Hartke

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