AltaGas acquires 25 percent stake in Petrogas

Canadian midstream firm AltaGas Ltd. acquired a 25 percent interest in Petrogas Energy Corp., a privately held North American midstream company, for about 2.8 million shares of AltaGas stock, valued at about $100 million.

David Cornhill, chairman and CEO of AltaGas, says the investment gives his company the infrastructure it needs to increase LP gas exports.

According to a press release, Petrogas’ midstream infrastructure consists of a logistics network made up of about 1,500 railcars and 24 rail and truck terminals. Petrogas has terminal and storage facilities with rail access in Fort Saskatchewan, Alberta, Canada; Sarnia, Ontario, Canada; Griffith, Ind.; Conway, Kan.; and Mont Belvieu, Texas.

As part of the agreement, Petrogas will purchase the natural gas liquids (NGL) produced for AltaGas’ account at AltaGas-owned processing facilities. The arrangement is expected to increase AltaGas’ access to various NGL end-use markets and improve optimization of AltaGas’ natural gas processing facilities.