CALGARY, A.B.: Pieridae Energy Ltd., the company behind the proposed Goldboro LNG facility, has announced they plan to acquire Shell Canada Energy’s midstream and upstream assets in the southern Alberta Foothills.
The purchase agreement secures the supply needed for its planned liquefied natural gas export facility as the Alberta Foothills area produces 28,623 barrels of natural gas, natural gas liquids and condensate and light oil per day.
“This acquisition will be immediately accretive to the company and also allows us to enhance the sustainability of our existing asset base,” said Pieridae’s Chief Executive Officer Alfred Sorensen. “It also demonstrates solid progress for our flagship Goldboro LNG project. We said we would acquire additional gas supplies for the LNG facility and we have done that.”
Pieridae will also acquire three deep cut, sour gas processing plants; Caroline, Jumping Pond, and Waterton, a 14 per cent working interest in the Shantz sulphur forming plant, and approximately 1,700 kilometres of pipelines.
Not only does this deal help Pieridae secure the remaining conventional natural gas supply needed for the first train of the Goldboro LNG project, Sorensen said it makes Pieridae a major player in the Alberta midstream and upstream industry.
“But more than that, it creates a solid, ongoing foundation for the company as we continue to build toward becoming the first Canadian company to market LNG off the east coast to global consumers.”
The purchase price of $190 million will consist of $175 million in cash and $15 million in common shares. Existing production and new drilling inventory will provide significant new gas supply along with an extensive, well maintained, underutilized and sophisticated gas midstream system.
“Pieridae would also like to acknowledge the Treaty 7 Nations as long-term, vital partners with respect to the assets,” said Sorensen. “In the spirit of reconciliation and cooperation, Pieridae remains committed to respectful engagement and collaboration with Indigenous Peoples.”
Poised to be the first LNG company to market in Canada, Pieridae’s Goldboro LNG facility will produce 10 million tonnes per year of LNG and will supply much needed natural gas to Europe and has signed a 20-year sales agreement with German utility Uniper worth approximately $35 billion.
Pieridae continues to work with global engineering firm Kellogg Brown & Root Limited (KBR) to review an amended version of the previously prepared front-end engineering and design (FEED) study for the project, and to conduct an open-book estimate necessary to finalize a lump-sum, turnkey engineering, procurement and construction contract with KBR.