AltaGas’ propane export facility finishes first full quarter

Marking the first full quarter of operations, AltaGas’ Ridley Island Propane Export Terminal (RIPET) in Prince Rupert, British Columbia, Canada – the country’s first marine export facility for propane – contributed $37 million of normalized EBITDA in the third quarter of 2019 and received about 40,000 barrels per day (bpd) for delivery to Asian markets, averaging two ships per month, the company reported.

AltaGas’ Ridley Island Propane Export Terminal. Photo courtesy of AltaGas

The facility began introducing propane feedstock in mid-April 2019, and the first shipment departed the terminal on May 23, 2019, bound for Asia. In 2017, AltaGas entered a multi-year agreement with Astomos Energy Corp., a Japanese propane importer and distributor, to purchase at least 50 percent of the propane shipped from RIPET annually, the company explains.

As the cornerstone asset of AltaGas’ midstream business, RIPET has extended its integrated value chain in northeast British Columbia, attracting additional volumes to its system, providing strong netbacks, as well as advancing future growth across its platform, the company says.

“RIPET has been successful in capturing incremental value for Canadian propane in international markets – a win-win for our producers and AltaGas,” says Randy Crawford, president and CEO of AltaGas. “Our focus now is execution at the terminal to gain scale and efficiencies that will allow us to grow our export capabilities by further increasing capacity.”

Included in its highlights for the year ahead is a 100 percent increase in annual export volumes to Asia in 2020 driven by a full year of operations and increased utilization at RIPET, with volumes expected to be in excess of 50,000 bpd by year-end 2020.

“Our distinct ability to handle the molecule through the entire value chain and provide access to premium-priced global markets is very attractive to western Canadian producers,” Crawford says. “We will leverage our first-mover advantage to drive the continued expansion of our integrated asset base and increase export volumes at RIPET. The facility itself was built to accommodate almost 80,000 [bpd], which will drive significant long-term earnings growth with minimal additional capital required.”

AltaGas is a North American energy infrastructure company with a focus on regulated utilities, midstream and power.