Petrogas acquires LP gas terminal on West Coast

Petrogas Energy Corp. reached an agreement with Chevron USA Inc. to acquire the company’s Ferndale, Wash., storage and distribution facility for bulk shipments of propane, butane and isobutane. Financial details of the deal were not disclosed, though it’s expected to close March 31.

According to a Petrogas press release, the terminal acquisition provides a strong fit for AltaGas Ltd. and Idemitsu Kosan Co. Ltd., which recently acquired interests in Petrogas. The facility gives AltaGas direct offtake for its production and for Idemitsu to acquire North American LP gas for its sales and distribution infrastructure in Japan as well as its other interests in southeast Asia, the press release also notes.

The LP gas terminal has the capability to handle exports and imports of up to 30,000 barrels a day and has facilities to handle and supply propane to the regional market for U.S. domestic consumption. The terminal has rail, truck and pipeline capability and is connected to the two local refineries offering LP gas balancing services.

Recent market and logistical developments, including the planned reversal of the Cochin Pipeline, have led many western Canadian producers to seek alternative outlets for their production. The acquisition will help producers manage their production, Petrogas CEO Stanley Owerko states in the press release.

“Petrogas is well positioned to provide additional takeaway capacity with its recently expanded Fort Saskatchewan terminal, providing an outlet for increasing LPG production in the western Canadian sedimentary basin,” Owerko adds.