Williams Companies, Inc.
) has entered into a gas processing agreement with a Canadian oil
Per the deal, Williams will engage in assembling off-gas generated
from bitumen feedstock and follow it up with the extraction of
valuable natural gas liquids (NGLs) such as propane and ethane. The
pure natural gas liquids will then be sent back to the oil sands
company for energy generation.
The whole process will be carried out at a site near Fort McMurray,
Williams expects to recover around 12,000 barrels per day of
natural gas liquids by 2015 and 15,000 barrels per day by 2018. The
natural gas liquids and olefins mixture will also be processed by
the company into other products, such as propane, for sale.
The mixture will be fractioned at Williams' Redwater facility into
an ethane/ethylene mix, propane, polymer grade propylene, normal
butane, an alkylation feed and condensate.
For a new liquids extraction plant, the company plans to spend
around C$500 million to C$600 million. It will also build an
extension of its Boreal pipeline to transport NGL and olefins to
its Redwater facility.
Williams expects to reduce carbon dioxide (CO2) emissions by
200,000 tons a year, and sulphur dioxide (SO2) emissions by 2,000
tons per year after reaching full operation capacity.
Combined with its
Suncor Energy Inc.
) operation, yearly CO2 emissions will be reduced by more than
500,000 tons and SO2 emissions will be reduced by more than 4,500
Williams Companies, Inc. is a premier energy infrastructure
provider in North America. The company's core operations include
finding, producing, gathering, processing, and transportation of
natural gas. Boasting a widespread pipeline system, Williams is one
of the largest domestic transporters of natural gas by volume.
Williams reports its results in three segments: Williams Partners
that includes the company's 72% owned master limited partnership
Williams Partners L.P.
); Midstream Canada & Olefins; and Other.
Williams currently holds a Zacks #3 Rank (short-term Hold rating).
We also maintain a long-term Neutral recommendation on the stock.
SUNCOR ENERGY (SU): Free Stock Analysis Report
WILLIAMS COS (WMB): Free Stock Analysis Report
WILLIAMS PTNRS (WPZ): Free Stock Analysis
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