No timeframe for restart of Keyera’s Wapiti gas plant

Keyera Corp. has indefinitely extended the timeframe of a recently announced unplanned outage at its Wapiti natural sour gas processing and liquid stabilization plant about 60 km south of Grand Prairie, Alta. (OGJ Online, Aug. 25, 2020).

Keyera informed Pipestone Energy Corp. on Aug. 27 that the issue relating to the Wapiti plant’s waste heat recovery system that led to the outage is more widespread than previously indicated, with the total scope of the problem and root cause of the outage still yet to be determined, Pipestone Energy—which has secured long-term natural gas gathering, compression, and processing capacity at the plant—said on Aug. 28.

As a result, the original estimate provided by Keyera to repair the plant and return to operations by the week ending Sept. 4 is no longer valid, with Keyera currently unable to provide a definitive indication for the anticipated duration of the plant’s outage, according to Pipestone Energy.

Based on this new development, Pipestone Energy has formally suspended its 2020 production and cash flow guidance released on Aug. 5 of 16,000-17,000 boe/d and $40 million at the midpoint, respectively, due to the timing uncertainty for the Wapiti plant’s return to normal operations.

Pipestone Energy reiterated its contingent business interruption insurance—which includes coverage on the Wapiti plant—has a 30-day waiting period but should cover any net financial losses incurred by the company, if necessary, should the outage extend beyond Sept. 16.

Pipestone Energy previously said both itself and Keyera are performing maintenance and installation activities that otherwise would have resulted in planned downtime during late third-quarter and early fourth-quarter 2020 during the ongoing plant outage.

Keyera commissioned Phase 1 of the Wapiti gas plant in May 2019 with gas processing capacity of 150 MMcfd and condensate handling capacity of 25,000 b/sd, and also has approved a second phase of the Wapiti plant scheduled for commissioning in fourth-quarter 2020 that will add another 150 MMcfd of gas processing capacity at the site (OGJ Online, May 31, 2018).