Tidewater Midstream enters Brazeau gas handling deals

Executive Summary

• Tidewater Midstream and Infrastructure Ltd. has entered into long-term agreements for gas handling and natural gas liquids (NGL) supply and fractionation at its Brazeau River Complex (BRC).
• The company will process up to 75 million cubic feet per day (MMcf/d) of natural gas from dedicated facilities, with marketing rights to the resulting ethane, propane, and butane.
• The agreements have an initial term of approximately five years with evergreen continuation options, featuring fixed processing and NGL handling fees subject to annual inflationary increases.

Key Details

• Agreement Scope: Long-term gas handling, NGL supply, and fractionation agreements at the Brazeau River Complex (BRC).
• Processing Volume: Up to 75 MMcf/d of natural gas sourced from dedicated facilities.
  • Approximately 65 MMcf/d from renewed volumes.
  • Approximately 10 MMcf/d from newly contracted volumes.
• Revenue Rights: Tidewater receives marketing rights to the ethane, propane, and butane derived from the processing.
• Fee Structure: Processing fees and NGL handling fees are fixed for the term of the agreements, in line with current market rates, subject to annual inflationary increases.
• Contract Term: Initial term of approximately five years, continuing thereafter on an evergreen basis.
• Facility Capacity (BRC):
  • 180 MMcf/d of deep cut natural gas processing capacity.
  • Approximately 10,000 barrels per day of NGL fractionation capacity.
  • Includes NGL/condensate pipeline connections, truck loading/offloading, physical natural gas storage, and two natural gas transportation connections.
• Strategic Context: The BRC processing and fractionation capacity is described as "highly contracted," with ongoing discussions to contract remaining capacity.

Notable Quotes

• "These are important agreements for Tidewater as they provide significant natural gas volume to the BRC from dedicated facilities on a long-term basis. The BRC processing and fractionation capacity is highly contracted, and discussions are ongoing with multiple interested parties to contract the remaining capacity at the BRC," said Jeremy Baines, chief executive officer of Tidewater.