Pembina Pipeline to Build Oregon Propane Export Terminal

Pembina Pipeline Corp. Tuesday said it will build a propane export terminal in Portland, Oregon, which will allow propane derived from natural gas produced in Western Canada to be shipped to international markets.

The Canadian pipeline company also said it has agreed to buy the recently constructed Vantage ethane pipeline extending from North Dakota's Bakken shale to Alberta, and related assets, for $650 million.

"Vantage provides long-term, fee-for-service cash flow and strategic access to the prolific and growing North Dakota Bakken play for future natural gas liquids opportunities," the company said in a statement.

Calgary, Alberta-based Pembina said it plans to fund the pipeline purchase with $395 million in cash and with an issue of $255 million of shares to the seller, Riverstone Holdings LLC.

Part of the cash consideration will be funded with preferred-share offering to raise 150 million Canadian dollars ($138 million).

For its planned 37,000-barrel-a-day propane export facility on the U.S. west coast, Pembina said it plans to invest about $500 million. It expects the facility to be in service by early 2018.

Pembina said the project is subject to definitive agreements, and the receipt of all environmental and regulatory permits and approvals.

The company said it signed an agreement last week for the terminal site and an existing marine berth within the city of Portland, which allows it to begin consultations for the project.

"Signing the terminal agreement is a tremendous milestone for the project," said Mick Dilger, Pembina's president and chief executive. "It marks the beginning of consulting and engaging with stakeholders, governments and the environmental and regulatory authorities," he said.

Write to Judy McKinnon at [e-mail]

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