Canada’s Pembina Gas Infrastructure (PGI) has signed an agreement to acquire midstream assets from Veren in a deal valued at CAD 400M (USD 294.7M).
PGI is a joint venture between Pembina Pipeline Corporation (Pembina) and investment company KKR.
The acquisition includes four batteries in the Gold Creek and Karr areas, boasting a natural gas handling capacity of 320 million cubic feet per day and a liquids handling capacity of 53,000 barrels per day.
These assets are connected to PGI’s Patterson Creek Gas Plant and Pembina’s Peace Pipeline system.
Veren will maintain operational control of the acquired assets, with operating expenses and maintenance capital directly allocated to Veren.
This arrangement also includes Veren assuming operatorship of the existing PGI-owned assets in the region.
PGI intends to invest up to CAD 300M in Veren’s future battery and gathering infrastructure, with one-third of this amount already committed.
Veren will be responsible for constructing and operating the batteries, while PGI will handle the construction and operation of high-pressure gathering pipelines.
Furthermore, Veren will form a 15-year take-or-pay agreement with PGI for capacity at the acquired assets.
This agreement will also include an area of dedication for PGI to provide gathering and processing services for all volumes produced by Veren in the Gold Creek and Karr regions.
The deal strengthens PGI’s partnership with Veren and consolidates legacy agreements into a simplified structure.
It extends the terms with 15-year take-or-pay agreements, aligns operations for better efficiency, and integrates with Pembina’s value chain for transportation and processing.
