Canadian Competition Bureau Challenges Keyera Acquisition of Plains Midstream Assets

The Competition Bureau of Canada has initiated proceedings to block a proposed acquisition by Keyera Corp., citing concerns that the deal would substantially lessen competition. According to Yahoo Finance, the Bureau's actions target Keyera's plan to purchase certain assets belonging to Plains Midstream Canada ULC, a subsidiary of Plains All American Pipeline, L.P. The regulatory body has filed an application with the Competition Tribunal, seeking an order to halt the transaction. This move stems from an investigation by the Bureau, which concluded that the acquisition, if permitted, would likely create a near-monopoly in the Straddle Plant services market within Alberta. Straddle Plants are crucial facilities that extract natural gas liquids (NGLs) from natural gas streams. Specifically, the Bureau’s assessment indicates that Keyera's ownership of the Cochrane and Fort Saskatchewan straddle plants, combined with the acquisition of Plains Midstream Canada’s Empress II and VI facilities near Empress, Alberta, would grant the company undue market power. The agency argues that this consolidation would leave only one other independent provider of these vital services, thereby hindering competition and potentially leading to higher costs or reduced service quality for producers. Keyera Corp., a major player in the midstream energy sector, focuses on the processing, transportation, and marketing of natural gas and natural gas liquids. Plains Midstream Canada operates a network of pipelines, terminals, and storage facilities, including the Empress NGL extraction plants. The Competition Bureau’s mandate is to ensure that Canadian businesses operate in a fair and competitive environment, ultimately benefiting consumers and the economy. Their intervention underscores a commitment to preventing mergers and acquisitions that could result in adverse market outcomes. The case will now proceed before the Competition Tribunal, which will evaluate the Bureau’s evidence and arguments before making a final decision on the proposed transaction.